International Residential Real Estate Sales in Fla. = $24.2B

Florida remained the top destination of foreign buyers purchasing U.S. residential real estate in 2017, with 22 percent of all foreign buyers who bought residential property in the United States. Florida Realtors®  latest report, the 2017 Profile of International Residential Real Estate Activity in Florida, finds that international sales hit $24.2 billion this year, up from $19.4 billion in 2016.

The economic environment created a mix of opportunities and challenges for Florida’s foreign buyers in 2016 and 2017, according to the report’s analysts. Latin American countries faced political and economic difficulties and weaker currencies in the wake of the collapse in oil prices. Meanwhile, economic growth strengthened in Canada and the Canadian dollar stabilized against the U.S. dollar.

House prices rose in the United States, including in Florida, but the appreciation was modest compared to home price appreciation in Canada. Amid these challenges and opportunities, overall foreign buyer purchases of Florida residential property increased: the share of buyers from Canada rose, the share of buyers from Latin America and Europe declined and the share of buyers from Asia and Africa remained unchanged.

The report is based on an annual study done by the National Association of Realtors® (NAR) in cooperation with Florida Realtors. It presents information relating to residential transactions with international clients of Florida’s Realtors as well as information on U.S. clients seeking to purchase property abroad during the 12-month period of August 2016-July 2017. In this report, the year 2017 refers to the 12-month period August 2016–July 2017, and the year 2016 refers to the period August 2015–July 2016. A total of 6,551 Realtors responded to this year’s survey, conducted Aug. 7-Sept. 9, 2017.

The survey considers only residential purchases in the state.

Report highlights

• Foreign purchases in the state increased to $24.2 billion, a $4.8 billion increase from 2016’s $19.4 billion.
• Foreign transactions accounted for 21 percent of Florida’s residential dollar volume of sales, a 2 percent increase year-to-year. Nationally, foreign buyers comprised 10 percent of the dollar volume of existing sales.
• Foreign buyers purchased 61,300 Florida properties (47,000 in 2016), which made up 15 percent of Florida’s residential market (12 percent in 2016). Nationally, foreign buyer residential purchases accounted for five percent of existing-home sales.
• The median purchase price paid by foreign buyers increased to $259,400 ($252,500 in 2016), which was in line with the overall increase in Florida prices.
• The median price paid by foreign buyers was 18 percent higher than the median price paid by all Florida buyers.

Nationalities of Florida’s foreign residential buyers

• Latin American and Caribbean buyers accounted for the largest portion of Florida foreign buyers (34 percent), though this group made up 39 percent the previous year.
• Canadian buyers increased to 22 percent (19 percent in 2016).
• Other countries remained consistent year-to-year: The share of European buyers was unchanged at 23 percent; Asian buyers at 10 percent; and African buyers at one percent.
• Most foreign buyers were concentrated in five metropolitan areas: Miami-Fort Lauderdale-West Palm Beach (53 percent); Orlando-Kissimmee-Sanford (11 percent); Tampa-St. Petersburg-Clearwater (nine percent); Cape Coral-Fort Myers (six percent); and North Point-Sarasota-Bradenton (five percent).

Transaction details

• 72 percent of foreign buyers made an all-cash purchase.
• 68 percent of foreign buyers purchased residential property for vacation, residential rental or for both uses (72 percent in 2016); 49 percent bought a townhouse or condominium (52 percent in 2016).
• 35 percent (40 percent in 2016) purchased in a central city/urban area; 15 percent purchased in a resort area (14 percent in 2016).
• 93 percent of foreign buyers visited Florida at least once before purchasing a property (92 percent in 2016).

Florida clients searching properties abroad

• 17 percent of Florida’s Realtors said they had a client seeking to purchase property abroad, up from 14 percent in 2016.
• Top countries of interest from Florida residents looking elsewhere: Colombia, Costa Rica, Spain, Canada and the Dominican Republic.
• 75 percent were interested in residential property (79 percent in 2016).
• 75 percent intended to use the property for vacation, residential rental or both uses (84 percent in 2016).

Florida’s Realtors interaction with international clients

• While international business rose, fewer Realtors in Florida (44 percent) said they worked with an international client in 2017 (48 percent in 2016).
• 61 percent of Realtors said they did not have cultural and language problems.
• Personal contacts, previous clients and business contacts accounted for 72 percent of referrals or leads.
• An agent’s firm, franchise website or social media was the primary source of online leads, followed by other aggregator websites and realtor.com®.
• Respondents were evenly split about the outlook in the next 12 months: 43 percent expected the same or an increase in international clients, 42 percent expected a decrease, and 15 percent had no opinion.
• 56 percent expect foreign retirees to be potential clients.