International tide lifts South Florida real estate market
“You have a unique opportunity for the next few years,” Moe Veissi, the president-elect of the National Association of Realtors®, told more than 200 people gathered for the 17th Miami International Real Estate Conference at The Biltmore Hotel in Coral Gables. “You are at the juxtaposition of the best global real estate market we’ve ever seen in this country.”
In 2007 and 2008, California led the nation in international sales, but Florida pulled ahead in 2009 and has been at the front of the pack ever since, accounting for nearly one-third of international transactions in 2011. Global buyers now account for $82 billion of residential purchases in the United States.
Of the international deals in Florida, 30 percent took place in the Miami-Miami Beach-Fort Lauderdale market, according to an international study by the National Association of Realtors. Distant runner-up was the Orlando-Kissimmee market with 14 percent of international sales in the state.
The Greater Miami area has transformed from a market with one of the largest inventory gluts in the nation to one where buyers, especially international buyers, are steadily chipping away at the backlog of unsold homes. The residential inventory for Miami-Dade fell from 25,769 last August to 15,405 this year, according to the Miami Association of Realtors.
“The absorption rate, especially in condos, has gone bananas,” said Veissi, who heads a South Miami real estate company. He served as president of Florida Realtors, the state Realtor organization, in 2002.
International buyers, especially from South America, see “real value” in South Florida real estate, he said. Veissi expects international transactions will be even stronger in 2012. “This is an excellent time to be an investor or buyer in Southeast Florida,” he said.
But the good news on the international front is tempered with home values that are still declining in some South Florida communities and a steady stream of foreclosed properties that continue to come on the market.
Still, “this will be a record-breaking year for the number of sales in the Miami market,” said Teresa King Kinney, chief executive of the Miami Association of Realtors.
To attract global business, Deborah Boza-Valledor, chief operating officer and chief marketing officer of the Miami Association of Realtors, suggested targeting international buyers through blogs or websites that provide buyers with real information about the market. “They can get listings from anywhere,” she said.
A new survey of the association’s members released Monday shows that Venezuela is still the leading international market with 15 percent of sales (compared to 28 percent last year), but Brazil is closing the gap, accounting for 12 percent of sales compared to 9 percent last year. Argentina, Canada and Colombia round out the top five markets.
One of the reasons local real estate agents are so enamored of international buyers is they are largely cash buyers. Eighty-five percent of Brazilians who bought property in Florida paid cash, 91 percent of Canadians, 90 percent of Western Europeans, and 88 percent of Venezuelans, according to the latest international report by the National Association of Realtors.
Foreign buyers also purchase higher-priced real estate. In August, the median sales price for a single-family home in the Miami-Dade market was $180,900, down 1 percent, while the median condo sales price was $118,800, up 13 percent, according to the Miami Association of Realtors. But the median sales price for a home purchased by an international buyer was $222,500.
Condos continue to be foreign buyers’ residence of choice with condominium sales accounting for more than 70 percent of purchases.
Eighty-three percent of the association’s members worked with at least one international client in the past 12 months, and 26 percent said international clients accounted for more than half of their business, according to the survey.
“That’s huge. There’s no other market in the United States that can boast these kinds of numbers,” said King Kinney. But she added, “No matter how much we have, we can always do more.”
The new survey also indicates that buyers from markets that weren’t a blip on the screen a few years ago are prospecting for South Florida properties. The survey reveals, for example, that buyers from India and China now each account for about 1 percent of international sales in the local market.
Copyright © 2011 The Miami Herald