International homebuyers may make hot real estate market even hotter
Florida real estate agents are bracing for a wave of international buyers to flood the housing market because of the federal government easing pandemic-related travel restrictions. If the influx is as large as anticipated, a tight housing market will grow even more competitive.
Foreign buyers make up about 5% of the dollar volume of sales in the Sunshine State. Experts believe that with travel restrictions lifted, they’ll be making their way to to Florida to buy a home or condo.
“An enlarged buyer pool looking to purchase when the inventory is at all-time lows will likely ignite the competitive bidding processes,” said Bonnie Heatzig, executive director of luxury sales with Douglas Elliman in Boca Raton.
And prices could get even higher in the luxury real estate market.
On Nov. 8, the Biden administration eased international travel restrictions, allowing vaccinated travelers with a negative COVID19 test from 33 countries, including much of Europe, Latin America, and China, to reenter the U.S. after a 20-month ban.
Most foreign buyers looking to purchase properties in Florida come from five countries: Canada, Argentina, Brazil, Colombia, and Venezuela, according to a report from the Florida Realtors.
South Florida is the most popular among foreign buyers, with the tri-county area getting about 52% of buyers, the report noted.
Canadians have already been making home purchases in South Florida, trying to avoid the colder weather up north, agents say.
Bobby Stroller, 49, and his family plan on visiting a condo that they bought site-unseen when they come down from Quebec in December.
Real estate agents and brokers have already begun to get calls from these buyers. Heatzig recently received inquiries from buyers in India, England and Finland.
Ignacio Diaz, co-owner of Group P6, a firm of luxury residential developers, said they’ve gotten quite a few calls from buyers in Canada and are starting to see some interest from Latin America.
“I just got off the phone with a buyer from Dubai,” said Tony Rodriguez-Tellaheche, owner and managing broker at Prestige
Realty Group. “The restrictions lifted at the best time of year to visit Miami.”
What international buyers want in a property varies. Some gravitate to luxury homes and condos, explained Diaz. Others look for properties that can give them a resort-like feel, while some are going for new construction.
“It’s hard to generalize, but mainly the foreign buyer tends to go towards condos because of the convenience,” said Edgardo Defortuna, President & CEO of Fortune International Group.
A big issue facing international buyers and further compounding the tight real estate market will be the lack of inventory.
“I’ve been trying to gear up as many off-market deals in the pipeline for when the flood comes in,” said Rodriguez-Tellaheche.
How the influx affects the pool for local buyers remains to be seen. It could certainly make the market more competitive, Heatzig said.
But Rodriguez-Tellaheche thinks it depends on how much free-spending foreign buyers are willing to pay.
“The average home price [for local buyers] is much lower than what I have experienced with international buyers,” he said.