International Buyers Contribute to Decline in Real Estate SalesAug 26th, 2009 | By Bea Weiss, Real Estate Consultant, Attorney | Category: International, Sarasota, Seller Advice
Following several years of robust growth earlier in the decade, home sales declined markedly in the past three years. While there are a number of factors that have contributed to the decline in sales nationally and in Florida specifically, one significant countervailing force has been the growing importance of foreign home buyers. Foreign buyers recognize U.S. real estate as a desirable, profitable and secure investment. In addition, the weak dollar has made U.S. real estate an even more attractive investment for foreign buyers. Many foreign buyers are drawn to Florida largely because the state is viewed as a desirable location, making it a top destination for buyers seeking a second home or investment property.
Slightly more than half of foreign buyers (52 percent) purchased a detached single-family home, compared to 78 percent among all buyers nationally. Approximately one third (34 percent) of foreign buyers purchased a condo, 7 percent purchased a townhouse or row house, and the remaining 7 percent purchased some other type of home.
According to the 2008 Profile of Home Buyers and Sellers, 93 percent of all home buyers used mortgage financing to purchase their home. Among recent foreign buyers in Florida, use of mortgage financing was less frequent. Overall, 32 percent of foreign buyers financed their home with a mortgage while 67 percent paid cash with no mortgage financing.
Many foreign buyers (16 percent) purchased a property to use exclusively as a vacation home. Fourteen percent purchased a home to be used as a rental property. Given the
limitations on the length of time that foreign buyers may be able to personally use their property, 24 percent of sales were for a dual use – as a vacation home for the buyer’s
family and friends and as a rental property at other times.
The Miami-Fort Lauderdale area was the most frequently reported location of a home purchased by a foreign buyer in Florida. More than one in four (27 percent) foreign buyers purchased a home in the area, followed by 11 percent who purchased a home in each the Sarasota and Orlando areas.
If you are interested in selling your home, contact a Real Estate Company which specializes in working with International Buyers – contact Weiss & Weiss International Realty.
Source: Florida Association of Realtors