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Front Page » Top Stories » Torrid housing pace catches up to ’04

Torrid housing pace catches up to ’04

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Written by on April 1, 2015

Torrid housing pace catches up to ’04

Despite four record-breaking years, residential prices are only now regaining their 2004 highs, according to Teresa King Kinney, CEO of the Miami Association of Realtors.

During an address at the Greater Miami Chamber of Commerce South Florida Real Estate Summit last week on Jungle Island, Ms. Kinney shared a report from the National Association of Realtors showing sales prices have amplified consistently since December 2011, with condominium prices increasing for 44 months and single-family homes for 39 months.

At the peak of 2007, the median sale price was $380,000 for single-family homes and $272,000 for condominiums compared with $245,000 and $189,000, respectively, in February 2015 – the same as 11 years ago.

Driving the record-breaking sales is what Ms. Kinney referred to as “the ultra-high net worth individual” led by Latin Americans who she said makes the difference between Miami today and a year or so ago.

In Miami-Dade and Broward counties, 68% of international buyers came from Latin America in 2014. In Miami, Venezuelans made 17% of international purchases here, followed by Argentina and Brazil at 13% each and Colombia with 8%. France comprised 6% of international buyers followed by Canada and Mexico with 5%, Italy with 4%, and 3% each for Peru, Spain, Ecuador, the Dominican Republic and Chile.

For the first time, China was on the list for second-tier countries of origin buying in Miami-Dade, joining Russia, the United Kingdom, Germany Nicaragua, Costa Rica, Honduras, Panama, India, Japan, Australia, South Korea, Portugal and Malaysia.

Florida tops the list of total international housing transactions in the US at 23% compared with California at 14%, Texas at 12%, Arizona at 6% and Washington, DC, at 4%, according to the 2014 survey of international home purchases conducted by NAR and released in March.

For international buyers in Broward and Miami-Dade, 28% are buying homes over $500,000; the average purchase price of Miami’s top international buyers is $444,052 compared with $245,500 nationally. Brazil tops Miami’s list, with an average purchase price of $494,531; Canada is the lowest at $310,484.

For all international buyers in Miami-Dade and Broward, 81% paid all-cash compared with 31% of international buyers paying cash nationally. France tops the list at 96% paying all-cash, followed by Argentina at 88%, Canada and Venezuela at 84%, Brazil at 77% and Colombia at 65%. For those using financing, 3% received mortgages from sources in their home countries and 15% from US sources.

Among the most important reasons influencing an international customer to buy real estate in Miami-Dade or Broward counties, 36% said it was a profitable income in 2014 compared with 20% in 2010; 31% said it was a secure investment compared with 45% in 2010. Other responses (31% last year compared with 29% in 2010) included conditions in their country of origin and pursuit of education in US universities.

In 2014, 80% of international buyers purchased previously owned homes with 18% purchasing new ones; 22% bought single-family homes, 65% bought condominiums, 7% townhouse or row houses; 9% condominiums, and 64% timeshares.

Miami was third on the list of the top US cities searched for housing purchases by international consumers, according to statistics from Realtor.com for February 2015. New York tops the list, with Orlando fourth, Fort Lauderdale sixth and Naples tenth.

Looking to the future, buyers in 12 of 20 countries around the globe have Miami on their target list. Canadians are looking in Fort Lauderdale and Miami; Germany is looking in Miami; Brazil is looking in Miami and Orlando; Mexico is looking in Miami; France and Italy are looking in Miami and Miami Beach; the Netherlands is looking in Miami; the Russian Federation is looking in Miami; Spain is looking in Miami; Sweden is looking in Miami and Fort Lauderdale; Switzerland is looking in Miami and Miami Beach; and South Africa is looking in Miami.

Ms. Kinney pointed to another indication of international interest in Miami – newspapers. The top countries covering the Miami market are the United Kingdom (first), China (second), Venezuela (third), Canada and Honduras (fourth) and Argentina, Chile, the Dominican Republic, France, Italy and New Zealand (tied at fifth).

Here in the US, a number of states are following the Miami market through their publications including (in order of volume of articles) Texas, California, New York, Nebraska, Connecticut and Louisiana, Georgia, Virginia and Illinois.

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