Stephane Torriglia flew in from Spain about a month ago to check out a row house for sale on Capitol Hill in Washington, D.C., and declared it the “perfect” buy for someone like him, a foreign businessman with euros to invest.
“The idea is we’ll convert our euros into dollars,” Torriglia said. “We can rent the place out. Maybe in five years or six, the dollar will be strong again and the real estate will gain value. It’s an opportunity.”
With the U.S. dollar at its weakest level in decades, international buyers are chasing housing bargains in America, eager to take advantage of their purchasing power and the declining prices in some of the best-known U.S. cities.
Against that backdrop, the Washington area is luring more than the usual crowd of diplomats. Now that the dollar is cheap, the region’s appeal has broadened, enticing international business types and sophisticated investors who find comfort in the area’s global reputation as a recession-proof market.
Several area real estate agents said inquiries from abroad have at least doubled since a year ago, mostly from wealthy Europeans and people in such growing economies as India and Russia, where the currencies are gaining against the dollar. Some are making all-cash offers. Even Web sites are seeing a surge in page views from overseas. The international traffic for D.C. area listings was recently up 60 percent year over year on Zillow.com, a popular real estate Web site.
“The impact of the weak dollar on foreign demand is one of these market forces that has snuck up on us,” said Jonathan Miller, chief executive of Miller Samuel, an appraisal company in New York. “It’s been gradually gaining momentum, and the demand has accelerated as the fall in the dollar has accelerated.”
The math works out nicely for Torriglia, 50, and his wife, Isabel. The euro is now worth about $1.55 – a record high. On top of that, Torriglia has bargaining power in a down market.
Torriglia has been working with Dana Scanlon, of Keller Williams Metro Realty, an agent he found on the Internet. Scanlon said Torriglia was one of three foreign potential buyers who contacted her in a single week in January. A year ago, the only foreign clients she had were relocating for their jobs, not investors like Torriglia, she said.
“The increase in that kind of buyer has been exponential. I’ve gone from zero to 10 nibbles since the beginning of the year,” said Scanlon.
Hasan Nazzal, who lives in the United Arab Emirates, has been shopping since December for land in Virginia where he could build a house and possibly keep horses. Leesburg appeals to him, he said, because it’s close to one of his brothers, who has lived in the area for nine years.
“I see this as being for my son’s future” or maybe a place for the family to gather, he said.
Nazzal, an engineer who owns an interior-design firm, said he can spend $1 million on the land.
In a 2007 study by the National Association of Realtors, about 25 percent of the real estate agents surveyed said they had more business from international clients than they did five years earlier. The weak dollar was cited as one of the reasons for the uptick.
More than a quarter of the foreign buyers bought their homes with cash, and those who did take out loans put down more money than domestic buyers, the study found.
