Imagine a housing market so strained that foreign cash buyers are stepping in to scoop up properties while everyday Americans struggle to afford a home. That’s the reality unfolding in the U.S. right now, as international investors, led by Chinese buyers, make waves in a market battered by high prices and punishing mortgage rates.
According to Fox Business, from April 2024 to March 2025, foreign buyers—predominantly from China—drove a notable uptick in purchases of existing U.S. homes, marking the first increase since 2017, according to the National Association of Realtors (NAR).
This surge saw a total of 78,100 properties snapped up by international buyers, representing a 44% increase from the previous year. Yet, it’s still the second-lowest level since NAR started tracking in 2009. The numbers paint a picture of a market with opportunities for those with deep pockets.
Chinese investors emerged as the dominant force among foreign buyers, leading in both total spending and transaction volume. Their expenditure soared to $13.7 billion, an 83% leap from the prior year’s $7.5 billion, per NAR data. The average purchase price? A staggering $1.2 million, topping all other international groups.
Location matters, and for Chinese buyers, California was the hotspot, with 36% of purchases made there. Another 9% targeted properties in New York. These preferences highlight a focus on high-value, high-demand markets.
Meanwhile, over half of these international transactions were cash deals. As Joel Berner, senior economist at Realtor.com, noted, “They’re wealthy international folks.” Their ability to pay upfront gives them a clear edge in a market where financing is a hurdle for many.
The U.S. housing market is in a bind, with affordability at a breaking point for domestic buyers. Home prices nationwide climbed nearly 4% year over year and a whopping 60% since 2019, according to the Joint Center for Housing Studies. The typical existing single-family home hit a record $412,000 in 2024.
Mortgage rates aren’t helping, averaging 6.67% for a 30-year fixed loan—more than double the roughly 3% seen in late 2021, per Freddie Mac. For many Americans, this rate spike turns homeownership into a distant dream. Weak domestic demand has created a vacuum that foreign buyers are filling.
Berner added, “They’re seeing there’s not a lot of demand for homes in the U.S.” This insight underscores how the affordability crisis is reshaping the market landscape. It’s a stark reminder of how policy-driven distortions, like relentless rate hikes, can sideline everyday buyers.
Even with foreign buyers stepping in, inventory challenges persist. Delistings surged 35% year to date and 47% year over year in May, outpacing inventory gains of 28.4% and 31.5%, respectively, according to Realtor.com’s June report. Sellers are throwing in the towel as homes sit unsold. Berner highlighted this trend, saying, “It’s helping to kind of eat up some inventory.” He also pointed out a rise in delisting activity. Many sellers, frustrated by a lack of bites, are simply giving up.
Foreign purchases provide some relief, absorbing properties that might otherwise linger on the market. But they’re not a full solution to the deeper structural issues plaguing housing supply and demand.
For those focused on building wealth, this trend signals both caution and opportunity. High mortgage rates and soaring prices mean traditional homeownership is less viable as an investment for many Americans. Consider alternative strategies—rental properties in less competitive markets or real estate investment trusts (REITs) could offer better returns without the debt burden.
At the same time, stay skeptical of market distortions driven by monetary policy. The Federal Reserve’s rate policies have priced out millions while opening doors for cash-rich foreigners—a classic case of unintended consequences. Keep an eye on local markets where inventory is piling up; there may be bargains if you can navigate the financing maze.
Ultimately, the housing market’s current state is a wake-up call. Liberty and economic freedom thrive when markets are accessible to all, not just the ultra-wealthy or international elite. Push for policies that prioritize affordability—your financial future depends on it.