The opening of the US borders to Canada, Russia, Brazil and 30 other countries is already showing signs that there will be a strong flow of international investors looking for real estate in Florida. The already heated housing market is projected to suffer even more from the lack of inventory in the single family home segment and soon may pressure prices in the condo segment as well, which still offers great opportunities in the region.
Over the past two years, the biggest impact has been felt in the single family homes segment. The condos segment was left out and still has a reasonable inventory and plenty of opportunities with attractive prices. It is expected that, with the recent opening of borders, the condominium segment will also be in demand, with the consequent pressure on property prices.
Opportunity for Foreigners
“It’s a great opportunity for international buyers who want to invest in Florida. Prices remain low and, with the opening of borders, demand will increase considerably, with a consequent appreciation”, projects Heloisa Arazi, broker at AMG International Realty, a full-service luxury brokerage firm in Florida.
According to the National Association of Realtors, in the years before the crisis (2018 and 2019), foreign buyers invested US$ 226 billion per year, on average. During the period of border closures and restrictive measures, that number plummeted. In 2021, only US$ 107 billion were invested, which indicates a considerable pent-up demand that was waiting for the opening.
E-commerce has evolved, but investors still prefer to be there
For over 20 months international investors were unable to enter the US. Although it is possible to purchase at a distance (without the need for the physical presence of the buyer), most buyers prefer to see properties in person. As a result, the market suffered in the months immediately following the closing of the borders. The crisis period did not last long, as demand from US domestic buyers, especially Americans from other states, increased considerably.
International Investors want safe investments
International investors are looking for safe buying and diversification of assets. Buying a property in Florida is one of the safest and most profitable ways to attach part of the property to a strong currency. “Latin American investors, in general, want to detach themselves from the political and economic turmoil of their countries of origin”, explains Heloisa. “Miami and Orlando remain the favorite destinations for high-end investors”, she adds. 20% of international real estate investments are made in Florida. Among foreigners, Brazilian buyers account for the largest share.
Inventory may not be enough
“It is necessary to act fast, since our forecast is that the condos will have the same behavior as the single family homes segment”, warns Heloisa Arazi.
The single-family homes segment was the most affected during the restriction period. Americans from other states invaded Florida in search of large homes and in less densely populated regions. Florida received more than 1000 new residents per day. There was no inventory for such demand. Today, the market for single-family homes is overheated, with very few homes available. 5 to 6 buyers even dispute the same property.
The condominium segment (apartments in luxury buildings) in cities like Miami and Tampa has not been in such demand in recent years. There was a judgment that a house would be safer than an apartment. In addition, everyone was (and still is) looking for spacious private outdoor areas, with a backyard and swimming pool. It is natural that these amenities are more noticeable in residential houses than apartments. It turns out that luxury condos in Miami are true “cities within a city”. These are clubs that offer everything a home can offer and more. The Porsche tower in Sunny Isles even has a swimming pool on the balcony in the apartment and a garage for the owner to park inside the residence by means of a high-tech car lift. Miami also offers a variety of luxury low density condos, another segment that is attracting international investors.
“It won’t be long before people realize that luxury condos in Miami are very cheap and they may even be better than single-family homes,” hopes Heloisa. If this behavior materializes, the extremely high demand for properties in Florida could migrate from houses to apartments, impacting this segment in the same way as the segment of single-family homes.
About AMG International Realty
AMG International Realty is a full-service luxury brokerage firm in Florida. If you want to learn more about Florida real estate market, please contact us now and chat with me on WhatsApp: +1 (305) 318 6968 (Heloisa Arazi).