Does your new next-door neighbor have an Irish accent? Maybe an Italian one? Or how about Canadian?
Don't be so surprised.
As the value of the dollar plummets, American real estate looks more and more attractive to overseas investors.
Foreigners buying property -- both residential and commercial -- in the United States is nothing new. But in recent months, as the exchange rate has swung further in their favor, Irish, British, Italian and even Canadian investors have started to gobble up more land here.
"This has been a record year for acquisitions by offshore investors," said Dan Fasulo, managing director of Real Capital Analytics, which tracks such transactions.
Through the first three-fourths of the year, there has been $31 billion in commercial real estate purchases by foreigners here, according to Fasulo. Compare that to $23 billion in all of 2006. And Fasulo added: the fourth quarter is usually the most active.
Americans have seen foreigners snag key properties in the past.
Probably the best example of this came in 1989 when 80 percent of the Rockefeller Center, one of New York's top landmarks, was sold by the Rockefeller family to Japan's Mitsubishi Estate Company.
But it wasn't just landmarks being bought by Japanese investors. Thanks to a strong yen many Japanese bought up residential real estate developments in places like California.
Today the money is coming mostly from Europe and probably not the countries you would expect.
Fasulo said that in the past, we have seen investment from Germany, Australia, Japan and the United Kingdom. But lately investors from other countries have joined them, including Ireland, Spain, Italy, Hong Kong and very recently Canada.
There are also plenty of buyers from the Middle East -- think Dubai -- but that buying spree is driven not so much by a decline in the dollar but by rising oil prices.
"Investors all over the world are just flush with cash that needs to be placed somewhere," Fasulo said. "U.S. real estate, to offshore investors, is considered a very safe and attractive investment."
Americans often take our legal system including property rights "for granted," he said. But overseas investors find those safeguards appealing.
Even Canada has recently jumped on the bandwagon with currencies in both countries reaching parity for the first time since 1976. Just last week, Toronto-Dominion Bank announced it was buying New Jersey-based Commerce Bankcorp for $8.5 billion.
Fasulo said foreigners often buy "what they know."
"They want the postcard assets. They buy Manhattan, Boston, D.C. San Francisco, Florida," he said. "They like to make acquisitions that they can communicate the story back to their folks at home."
Garrett Kenny, has been selling American real estate to Europeans for more than a decade.
Kenny, who hails from Ireland, got into the business after he came to Florida looking for some real estate for himself.
He now has two real estate brokerages -- Coldwell Banker Feltrim -- in the Orlando area and a development company catering to Irish investors.
Florida has been hammered by the fallout from the nation's subprime mortgage problems. Kenny said the only thing saving sales is overseas money.
"It really did hurt us at the start of the year. People were uncertain. They didn't know what was going on. There were no sales," he said. "However, in the last 60 days with the dollar going to its all-time low, there has been an increase in interest."
Some European buyers are looking to buy property purely as an investment because of the currency differences, Kenny said. Others want another home as a vacation destination -- a place they can use while on holiday and then rent out the rest of the time.
Britain Martin Harwood first started to invest in property in Florida in 2000 after a family vacation in the Sunshine State. His first property was a six-bedroom villa with a pool in a new development. Harwood, used it for vacations and as a rental property.
Since then, he has bought a few other properties as investments and to meet the changing demands of his family.
"It was not our intention to buy further property in Florida as I like to spread my investments," Harwood said in an e-mail, "but with the weak dollar" he said other real estate purchases "could not be missed."
"Personally, I anticipate holding on to the property for a few years and as such, I firmly believe that property prices will again start to rise as they always do and there is likelihood that the dollar will strengthen again from which I would benefit when bringing the money back," he added. "Either way, I don't really see myself losing out on this investment as, if the dollar continues to weaken, the properties become more attractive to UK buyers which will ultimately push up the prices."
Kenny said the Irish and British, like the Orlando area while French and German investors focus on beachfront property.
Propping Up the Market?
While Americans will put 10 percent down for a property and finance the rest of the cost, Kenny said, a lot of the European buyers put down 25 percent.
"The Europeans tend to look at property with a longer-term view," he said.
Buying real estate in New York has never been a bargain, even with currency differences.
But wealthy Europeans these days are buying larger and more expensive apartments than they normally would in New York.
"When the Europeans are coming here, they know they are getting a big discount that is very attractive to them," said Jill Sloane, a senior vice president at Halstead Property.
She just sold a 2,248-square-foot apartment for $11 million to an Italian man. Because of the difference between the Euro and dollar, he essentially bought the unit at a 30-percent discount.
Ray Dimmock's family is buying a one-bedroom apartment in New York.
His daughter has worked in the city for some time and is going to stay there a while.
So with the exchange rate where it is, the London-based family decided to buy.
"If you want property in New York, and the whole of America, it looks to be a good value," Dimmock said. "On the basis that we have a use for what we're buying -- not just an investment -- we're going ahead and buying."
The British pound is worth a little more than two dollars these days. Dimmock said if it was only worth $1.90, "I'd probably still go" ahead with the purchase. But if it was at $1.80 -- probably not.
While most real estate markets in the country are struggling, New York has managed to hold on to its value. Sloane attributes that, in part, because of the foreign investment.
"It is," she said, "really keeping the market strong."