ORLANDO — Florida remained the top destination of foreign buyers purchasing U.S. residential real estate in 2018, with 19 percent of all foreign buyers who bought residential property in the United States. Florida Realtors latest report, the 2018 Profile of International Residential Real Estate in Florida, finds that international sales accounted for $22.9 billion last year, down slightly (5 percent) from $24.2 billion in 2017.
The state’s rising property values coupled with a lack of for-sale inventory impacted the slower pace of international residential real estate activity, according to the report, which looked at Florida’s foreign buyer and seller transactions from August 2017 through July 2018.
In many areas, foreign buyers compete with U.S. buyers for the same properties, and solid U.S. employment growth boosted the domestic competition, the report found. In addition, mortgage rates remained relatively low compared to historic values, and the large supply of buyers, both foreign and domestic, had to compete for a relatively small number of homes for sale.
A stronger U.S. dollar also made Florida homes more expensive for foreign buyers from selected countries, notably Venezuela and Brazil. When asked about challenges faced by their international clients, Realtors surveyed said top objections included cost of property, could not find a property, and exchange rate.
South Florida remains the preferred location for international business. While foreign buyers purchased property across the state, most foreign buyers were concentrated in five metropolitan areas:
Miami-Fort Lauderdale-West Palm Beach (54 percent)
Orlando-Kissimmee-Sanford (9 percent)
Tampa-St. Petersburg-Clearwater (9 percent)
North Point-Sarasota-Bradenton (5 percent)
Cape Coral-Fort Myers (5 percent)
Size of Florida’s international market, 2017-2018
Foreign buyers purchased $22.9 billion of Florida’s existing detached single-family, townhomes and condominiums — a 5 percent year-to-year decline from $24.2 billion.
In dollar value, foreign buyers made up 19 percent of the market (21 percent in 2017). Florida’s foreign buyers accounted for a larger fraction of the dollar volume of existing home sales compared to the national share of 8 percent.
In number of sales, foreign buyers purchased 52,000 of Florida’s existing homes — a 15 percent year-to-year decrease (61,300 one year earlier).
As a percentage of all sales, foreign buyers made up 13 percent in the latest report — 15 percent in the year before.
Average cost of foreign-purchased home: $286,500 compared to $259,400 in 2017, or about a 10 percent increase.
Overall, foreign buyers paid about 20 percent more than the median price of a Florida home.
This article contributed by Florida Realtors.