Miami condo prices attract foreign
June 23, 2014
The Canadian retiree Sheldon Kovensky tempted these days attracts many foreign buyers to sunny Florida: Falling prices of luxury oceanfront condos to buy at a good price, taking advantage of a weak U.S. dollar.
Kovensky has been touring southern Florida, from Miami Beach to Palm Beach, looking for an apartment of three rooms on the beach.
Armed with a Canadian dollar in the past two years has risen 25 percent against the U.S. dollar, expect to find a good bargain.
“We hope to find an apartment worth nearly one million dollars (U.S.) which can be purchased for 20 percent less,” he said in a telephone conversation from his home in Unionville, Ontario, as he prepared to clear snow that left a storm .
“The Canadian dollar is stable and the Florida market has fallen from 20 to 30 percent, so that you can make a good bargain with our money,” he added.
Realtors, buyers and analysts say the strong Canadian dollar, the euro and other currencies, with the fall of the housing market, make America a tempting place for foreigners looking to buy property.
In fact, they argue that the combination of the weak dollar and the attraction of Miami as a cosmopolitan and multilingual city may be helping sustain faltering and excessive condo market, where prices are expected to plummet, but so far have shown only a slight decline compared to other cities in Florida.
In a study by the National Association of Realtors last year, Florida was the top destination for foreign buyers, accounting for 26 percent of all transactions, up from California with 16, Texas with 10 and Arizona with 6%.
More than 7% of all Florida homes were sold to foreigners, the study found, and 65% of estate agents said they had finalized one agreement with a foreign buyer.
The online real estate auction site in December FastHomeAuction.com recorded a record number of foreign visitors, citing the weak dollar as a key factor.
OVERSEAS BUYERS PARTY
Jan de Vetten, Dutch wholesaler of toys has assembled a side business helping friends and business partners to buy homes in Florida, said that in some cases have been able to negotiate the purchase of houses for half the price.
“I traded Typically 25 to 30 percent less than asking price and the euro is now nearly a dollar and a half, so that will probably make another 10-15 percent in value,” he said.
Purchases by foreigners also noted strong activity in Arizona, New York and elsewhere.
In New York, the median sales price in Manhattan climbed to a record $ 1,439,909 in the fourth quarter of last year, thanks to foreign buyers boosted demand.
In Phoenix, Canadians are buying what for them would be a second home, most exclusive homes on golf courses as a refuge from the harsh winter, according to the officials said. Many come from Calgary, the Canadian city of rapid growth thanks to oil.
“There’s definitely Canadian money in the city,” said Julie Goodman a Remax agent who said he sold six houses and was waiting four other families to visit several properties. “They pay cash and know that cash talks.”
After the U.S. housing market reached its peak in 2005 and reached the crisis of subprime mortgages, sales and prices began tumbling across Florida. The worst was felt in west coast cities like Punta Gorda, where condo sales fell 50%, and in Fort Myers, where the average price of an apartment fell 21% in 2007.
While sales fall Miami -39% for single-family resale homes and 41% for condominiums-, median prices remained resilient before finally weaken in December 2007.
For the year, the median condo price in Miami rose 6%. But analysts expect a fall in the coming months, once thousands of new condo units entering the market.
SOUTH BEACH WITH POOL
The weakness of the U.S. dollar, according to agents, attracts buyers from Europe, Scandinavia and Canada to Miami, in addition to the traditional flow of money volatile economies of South American countries, particularly Venezuela.
A strong pound has made the UK seek properties outside its traditional territory of Orlando, said Vani Ungapen, Research Director of the Foundation for Florida Realtors.
“Most of them buy homes at the highest level,” said the agent. “Looking for a big house with a pool and that can not be bought in London.”
Agents say that the famous South Beach district of Miami Beach attracts Italian, French and German; Russians go to Sunny Isles Beach to the north; Venezuelans who may fear the policies of socialist President Hugo Chavez bought in Doral, west.
The real estate agent Benichay Brigitte said French middle-class entrepreneurs are eager to join the 30,000 members of the French community in Miami and open businesses in the city.
“They’re paying cash because of the strength of the euro,” he said. “80% of those who know they want to pay in cash. Business is very strong.”
The Beacon Council, the business development agency of Miami, said that more and more foreign businesses established in the city.
The number of multinational projects in which the council has virtually doubled in five years work, and these companies bring employees who are interested in buying property.
“The economic market here is very broad. Already we stop relying on one industry, such as tourism, or a region such as Latin America,” said President Frank Nero
Despite the explosive price increases in recent years, Nero said prices may seem low for someone from Paris or Madrid.