Foreigners Purchase 1/3 New York City Condos

In recent years there has been wide agreement that foreigners have been big buyers of New York City residential real estate. What’s been missing is much in the way of hard data.

As it turns out, overseas buyers currently account for one-third of condo buyers and 15% of the total buyers in the city, according to figures released Friday by residential brokerage Stribling & Associates. During the peak of the market in 2007, foreign buyers made up as much as 30% of total purchases in the city, according to Stribling.

“The countries may change, but international buyers will always look to New York as a prime (location) for a home,” said Elizabeth Stribling, president of the brokerage, in a statement. Ms. Stribling first shared the statistics last month at Savills’ global World Cities Review conference. Global luxury real estate property firm Savills is Stribling’s international affiliate based in UK. Part of that resilience owes to the fact that foreign buyers have a greater tendency to use all-cash in purchasing property, and as a result have not been hampered as much by the tight credit market.

New York City property has long attracted foreign buyers, a trend that took off in 1976 when the Olympic Tower opened on Fifth Avenue and East 51st Street, according to Stribling. It noted that foreign buyers are attracted to new modern, glassy towers as well as pre-war properties that have been converted into luxury condos. The brokerage also noted that biggest overseas buyers today are those in Russia, China, Brazil and Argentina. Back in the early years of the new millennium it was Europeans, led by the Irish who led the charge in New York.

“Over the last year the dollar has been especially weak against a number of foreign currencies and that has increased foreign investor participation in Manhattan, which has been helpful to the new development and condo market,” said Jonathan Miller, CEO of Miller Samuel Inc., an appraisal firm which puts out a quarterly residential market report along with Prudential Douglas Elliman. “Foreign buyers are one of the key reasons condos outsold co-ops in the third quarter.”

During the third quarter, co-op sales activity was unchanged, but condo activity rose 33.4% contributing to the overall rise in the number of sales for the quarter, according to the Prudential Douglas Elliman/Miller Samuel report. An increase in demand from foreign buyers was a key factor in that boost of condo activity. Mr. Miller does not track foreign buyer activity in his report.