When a High Dollar Hurts.
The contribution of international purchasers to our real estate market is highly dependent on currency fluctuations, and the strong dollar is keeping foreign buyers away. Particularly hurt are Canadians, whose currency is worth around 60-65 cents U.S. Taking their profits, last year more than twice as many homes were sold than bought by Canadians in the Phoenix metro area, and in the last quarter of 2015 that ratio rose to 3:1.
More evidence comes from the Conference Board of Canada, which reports that there were 1 million fewer overnight trips to the U.S. in the first 7 months of 2015. What sunshine states were the most effected by this staggering decrease? Primarily Texas and Florida. In contrast, in the first 7 months of last year Arizona’s traffic numbers actually went up. One reason is that Arizona is considered an upscale “snowbird” market, and wealthier Canadians are less affected by currency fluctuations. But the sales by so many Canadians of their homes here may mean that visits will decline this year.