A weakened U.S. dollar and falling home prices are turning America's second home market into a fire sale for some foreign buyers.
Not only can buyers from abroad cash in with stronger currency, falling domestic home prices and short term vacation rental income helps seal the deal.
The US Dollar Index, which tracks the greenback against six major international currencies, has recently been at its lowest point since the index was created in 1973.
That's because the sluggish U.S. economy is bogged down in higher energy cost-inflation; subprime mortgage securities losses; and falling interest rates, among other market conditions.
The national median price for all housing types fell more than 5 percent in October. compared to a year ago. That was the greatest national home price decline since the National Association of Realtors (NAR) began record keeping 39 years ago.
Christine Karpinski, director of Owner Community for HomeAway.com, a leading online vacation rental portal, says slow home sales is a good thing for investors looking for vacation home bargains. And vacation rental income can help pay the mortgage.
Elliott Pollack, a Scottsdale, AZ economist said when combining the lower cost of homes in his neck of the woods with the lower value of the dollar, to foreigners, American homes are a full one third cheaper than in recent years.
Conditions are similar in Las Vegas where Asians are major buyers of condos and other real estate.
In Florida, a growing number of buyers are also foreign and Stewart Title says, when compared to western Europe and Asia, Florida home prices are a bargain.
According to NAR's "They Come To America - To Buy Homes," in 2006, 65 percent of Florida real estate agents had at least one international customer and the trade group's "Profile of International Home Buying Activity" indicated that at least 7 percent of 2006 home sales in Florida were to foreign purchasers.
