Foreign buyers bullish on Florida housing even if Floridians are not

Published June 13 2012
Updated June 14 2012

To the snowbirds of Canada, the sunseekers of Europe and flight capitalists of Latin America, Florida sends you all a great big Thanks! for buying homes here in such abundance.

When it comes to international buyers snapping up housing in the United States, Florida property remains the runaway favorite. The state tallied 26 percent of international sales in the country, says a new National Association of Realtors report for the year ending March 2012.

"Florida has been the fastest-growing destination of choice," states the Profile of International Home Buying Activity 2012. California was second with 11 percent, while Texas and Arizona each had 7 percent, followed by Georgia and New York.

That Florida property has long been popular with foreign buyers is no secret. But with domestic home buyers still wary or financially unable to purchase property right now, the big international appeal of Florida homes is especially important news.

Of course, Florida has an edge.

Canadian snowbirds have deep ties with Florida and remain eager to leverage Canada's strong currency in buying deeply discounted property. (Lately, however, Canada's dollar, known by its nickname the loonie, has been slipping.)

The typical Florida home that sold in 2006 for about $260,000 now sells for less than $140,000.

Europeans like Florida for the sun and proximity. The state is easy to get to by air and many Euro-tourists are familiar with the state via previous visits, especially to the Orlando theme parks. And Latin Americans have long viewed Miami as their home away from home. Not only are South Florida real estate values considered cheap by Latin standards, but Miami has long represented a culturally simpatico destination for "flight capital" — funds invested overseas to avoid home-country restrictions on international money movement.

Most of these kinds of transactions are done in cash.

At a real estate conference held last week at St. Petersburg's Renaissance Vinoy Resort, Miami-Dade Mayor Carlos Gimenez spoke about the recent hyper-glut of empty condo towers across his city's downtown. Now those towers are mostly full, thanks largely to Latin money. Gimenez expects a fresh round of construction and downtown cranes in Miami very shortly, despite news reports citing a slowdown in Brazil's economy.

On the nation's West Coast property market, in contrast, Asians are far and away the dominant international buyers.

To be clear, the NAR report defines international home buyers two ways. The first is the foreign buyer who lives outside the United States and purchases here as an investment or for vacations and visits of less than six months.

The second type of buyer is the recent immigrant or temporary visa holder residing for more than six months in the United States for professional, educational or other reasons.

Combined, the international home buyers generated $82.5 billion in property sales last year (up from $66.4 billion a year earlier), the NAR report says. Canadian buyers were tops with 24 percent of international sales in the United States.

Florida's new motto? Hang in there, loonie.

Robert Trigaux can be reached at [email protected]