As Eurozone crisis mounts, searches for U.S. real estate safe havens grow

Source: Wall Street Journal

Web traffic to a U.S. real-estate website jumped in the fourth quarter from countries at the center of the euro-zone crisis, suggesting that low prices could be luring foreign and domestic buyers alike.

But looking at home listings online is a long way from actually buying a new house, so the bump could be fleeting, fueled by Greeks and Italians admiring photos of Florida condos instead of reading more depressing financial news. Foreign buyers can play a significant role in a few U.S. markets such as Miami, but frequently searched cities such as New York and Los Angeles are unlikely to be altered by this traffic uptick.

The online traffic was measured by Trulia, a San Francisco-based company that aggregates U.S. real-estate listings and provides other real-estate analysis. Trulia only started tracking data on international visitors to its site in 2011, meaning it’s not possible to see how past crises might have affected Web traffic.

While Trulia saw an increase in traffic from Greece and Italy (and, to a lesser degree, Spain), clicks on its website were down from other European countries, led by a steep decline from the Netherlands. And some of those other countries, including Ireland, have seen their fair share of trouble from the debt crisis.

Guessing what’s behind the Web traffic is, to a certain extent, just that: Trulia doesn’t know the demographic makeup of the users other than where they are located. In other words, it might be someone who considers the U.S. market a safe bet, or just as easily someone waiting for prices to drop further.

European countries also have housing problems of their own. The Economist recently pointed out that several markets still appear to be overvalued by about 25% or more, including Belgium, France, the Netherlands and Spain — among others. As the Economist said, U.S. home prices look cheap in comparison.

Of course, as The Journal has written, falling prices in some European housing markets could make it a good time for American buyers fortunate enough to be looking for a vacation villa on the Continent.

URL to original article: http://www.builderonline.com/builder-pulse/as-eurozone-crisis-mounts--searches-for-u-s--real-estate-safe-havens-grow.aspx?cid=BP:011112:JUMP

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