Brazilian buyers are leading demand for property in Miami, according to new figures. Florida has always attracted investors from South America and around the world. Indeed, the market’s combination of a strong tourist industry, buy-to-let potential and lifestyle appeal makes Florida the most popular US destination on TheMoveChannel.com, with Miami at the top of the shopping list.
“Miami’s location and proximity to the Caribbean and Latin America have always attracted foreign buyers,” says Carlos Gutierrez, the 2015 Residential President-elect of the association.
South America, though, is leading the way.
The group registered 192,987 visits to its website, Miamire.com, in January, a 46.8 per cent increase compared to the same month last year. Brazil topped the list of foreign countries conducting searches on the site, overtaking Venezuela, which was ranked number one in January 2015. (The top five is completed by Colombia, Russia, Venezuela, and Canada.)
Nationally, Miami is consistently one of the top markets for most of the highest ranking countries searching for property in the US – including Brazil, Germany, Netherlands and Spain. In January, it was a top market for 13 of the top 20, including Canada, Mexico, France, Italy, Sweden, Russian Federation, South Africa, Switzerland and Turkey.
Indeed, in January, Miami ranked second among the top-10 overall most searched US cities by non-US consumers on Realtor.com, behind Los Angeles and New York.
That steady overseas interest helped to fuel double-digit growth in property sales in February.
Single-family home transactions increased 14.2 per cent year-on-year, while existing condominium sales — which posted the second best year in Miami history last year, despite an increase in construction — rose 1.4 per cent.
“Seller confidence and buyer demand in the Miami real estate market is leading to more active listings and higher sale prices,” says Christopher Zoller, the current Residential President.
Indeed, prices of condos have risen 44 months out of the past 45, while home prices have risen year-on-year consistently for more than three years.
The median sale price for single-family homes increased 7.9 per cent, up to $245,000 in February 2015, while the median sale price for condominiums increased 6.8 per cent to $189,000.
But will booming Brazilian demand continue to boost the market?
Peter Zalewski, a former corporate board member of the association, notes that the country is facing multiple financial obstacles, from a slowing economy to a weakening currency against the strong dollar.
“The exchange rate to the dollar of Brazil’s currency, the real, has plummeted by 30 percent on a year-over-year basis to 31 cents on April 8 compared with 44 cents on the same date in 2014, according to the currency conversion website OandA.com,” he wrote in the Miami Herald .
According to Realtors, in 2014, Brazilians spent the most on South Florida property among foreign consumers, paying an average of $495,000 per property, above the $245,000 statewide average. With prices continuing to climb, will the market become too expensive for Brazil?
Cash sales in Miami – a sign of international demand – increased relative to January 2015, according to the Miami Realtors. However, cash transactions fell compared to the same time period last year, their share of deals dropping from 62.5 per cent to 58.8 per cent.
Despite this, Realtors are optimistic.
“Miami’s home prices are still very affordable when they are compared with other major cities such as Los Angeles and New York and even in comparison to cities with less attractive lifestyles and amenities,” notes Zoller.
Indeed, Miami’s percentage of all-cash sales remains more than double the national average.
“It may be more likely that Brazilian investors opt to own less extravagant properties in the tricounty region,” suggests Zalewski.