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South Florida real estate agents are bracing for a wave of international buyers to flood the South Florida housing market as a result of the federal government easing pandemic-related travel restrictions on Monday. If the influx is as large as anticipated, a tight housing market will grow even more competitive.
In Florida, foreign buyers make up about 5% of the dollar volume of sales. Experts believe that with travel restrictions lifted, they’ll be making their way to South 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.
The Biden administration eased international travel restrictions last week, allowing vaccinated travelers with a negative covid-19 test from 33 countries, including much of Europe, Latin America, and China, to reenter the U.S. after a 20-month ban.
Miami International Airport has already begun seeing a spike.
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 told the Sun Sentinel. 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, as South Florida is facing record lows in available homes, condos and townhomes.
“I’ve been trying to gear up as many off-market deals in the pipeline for when the flood comes in,” said Rodriguez-Tellaheche.
In Palm Beach County, there is only enough inventory for a little over a month, a 51% decrease from the year before. Broward County is facing a 1.5 months supply of inventory, a 40% decrease from the year before. Similarly, Miami-Dade County has a 2.2 months supply of single family homes, a 42% decrease.
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 price point. “The average home price [for local buyers] is much lower than what I have experienced with international buyers,” he said.