- Trade between Russia and the Untied States totals around $35B
- The American market is expecting negligible effects
- Russians account for less than 1% of foreign buyers in the US market
The ongoing pandemic has taken a step back as the main ongoing news item as the world watches in horror the Russian invasion of Ukraine. While sanctions have increased the cost of various commodities, such as oil, what will the impact make on the housing markets.
Australia trades very little with Russia – the world’s largest country is only our 46th largest trading partner. Historically, our exports to Russia have totalled less than $1 billion on an annual basis.
However, this is a different picture with between the Untied States and Russia, where there is about $35 billion worth of trade.
How is this impacting American housing?
The American housing market is reportedly expecting minimal impacts. Several factors were raised in the latest analysis completed by America’s National Association of Realtors (NAR).
NAR analysis noted that Russian foreign buyers accounted for 0.8% of foreign buyer purchases made in the United States, and even with any reduction in foreign buying, it could lead to domestic delight as supply constraints for domestic buyers would ease.
The data set was derived from American residential property purchases made between April 2015 and March 2021, according to an NAR survey of foreign buyer transactions of the organisation’s members with some 5,000 respondents.
Analysis also noted foreign buyer purchases made up only 1.8% of total existing-home sales.
While Florida proved most popular with Russian buyers, the story of negligible impacts continues: NAR said Russian transactions in Florida only accounted for 0.2% of Florida’s total market between July 2020 and June 2021.
America’s sunshine state was more popular with Canadians, Latin Americans, and Western Europeans.
Data also suggested that Russians were purchasing higher end properties. The median figure for Russian purchases in the US was $325,000, as compared to the median of all foreign buyers at $303,200. The figure that suggested premium desires: an average purchase price of $652,915 as compared to the overall foreign buyer figure of $480,695.
Two metrics saw Russian buyer percentages similar to overall foreign buyers: those who lived abroad or in the US.
To provide more context to foreign buying in the United States, for the same April 2015 and March 2021 period previously mentioned, Chinese, British, German, and French buyers made up almost 20%, Canada 11%, and Mexico 8%, and India 6%.
