Overseas demand for U.S. property is weakening dramatically.
The median price paid by international buyers was $465,000, well above the national median of $413,600.
This drop in foreign purchases is part of a broader trend where high home prices and limited inventory are cooling overall demand.
Canada remains the biggest source of foreign buyers, accounting for 16% of all international transactions. Mexico came in second at 14%, and China was third at 11% - down from the top spot last year.
"Chinese buyers remain some of the biggest spenders by volume," said Maria Garate-Lavalle, a Douglas Elliman agent in California.
Get the market news that matters in a five-minute read with Market Briefs, our free daily newsletter
Canadian buying activity took a hit earlier this year because of U.S. tariffs and political tension. But it has since recovered, especially in Florida, where Canadians have been a steady force for decades. Miami-based luxury real estate adviser Kevin Rutois noted, "Canadian buyers and tourists have been longtime fans of Florida, and more specifically South Florida."
Mexican buyers, meanwhile, are looking elsewhere. "Inflation has played a big role in their decision making when choosing to buy a second home, and alternatives like Madrid [and] Spain have become increasingly popular," Garate-Lavalle said.
Nearly half of all foreign transactions came from buyers living abroad (44%), while the rest came from recent immigrants or visa holders already in the U.S. (56%).
Florida remains the top destination, capturing 20% of all foreign buyer transactions. Nearly half of those Florida buyers are Canadian. Miami-Dade County alone saw foreign buyer volume jump to $3.2 billion, up from $2.3 billion the year before.
"That growth came despite real friction, when U.S. tariffs on Canadian goods and cross-border political tension pulled Canadian buying activity back before it recovered," said Ana Bozovic, a Miami-based agent and founder of Analytics Miami.
California pulled in 19% of foreign transactions, followed by Texas at 12%. New Jersey and Georgia each accounted for 4%.
Why does it matter? Most foreign buyers are not just buying a place to park their money. About 65% purchased single-family homes, and 49% intend to make the property a vacation residence, rental, or combination of both.
"It's a hybrid model foreign buyers gravitate toward: a real vacation home when they want to use it, professionally managed the rest of the time, with none of the burden of being a landlord," Bozovic said.
Canadians and U.K. buyers in particular are buying condos at higher rates because they plan to use them as vacation homes. But even they are shifting what they want.
"I have noticed my Canadian clients still care about being near the water, but have slowly transitioned their priorities to nicer amenities and walkable areas," Rutois said. "The beach is always nice, but being able to go downstairs and walk to shopping, good food, and attractions for the kids has become a big priority."
Recent Census Bureau figures reveal that the U.S. population grew by 1.26 million due to international immigration between July 2024 and July 2025, a trend that parallels the drop in foreign home buying. High prices and tight inventory continue to cool demand.
Join Market Briefs, our free daily newsletter, for a quick daily rundown of the markets
