Real Estate Banking Industry Applauds Decision To Leave Foreign Visa Rules Unchanged
By Susan Stabley
Miami’s luxury real estate market may get a boost from foreign investors now that a proposal to further limit the length of stay for international visitors has been withdrawn.
Gov. Jeb Bush applauded last week’s decision by the Bureau of Citizenship and Immigration Services, formerly known as INS, to withdraw a rule that could have limited foreigners to 30-day visits instead of up to six months.
According to the Governor’s Office, in 2001 more than 8 million international visitors came to Florida. Tourism is the state’s top industry, comprising 20% of Florida’s budgeted general revenue and generating more than $50 billion in economic impact annually.
Just this month, the Immigration and Naturalization Service, was disbanded and absorbed by the new US Department of Homeland Security. The Department of Justice dropped the rule change before making its official transition, though it is still unclear whether the new department will try to revive the limitations.
Alex Sanchez, CEO for the Florida Bankers Association, said the proposed rule could have cause a major divestiture of Florida holdings by foreigners.
International visitors generated more than $500 million in sales tax revenue, Mr. Sanchez said. Substantial portions of the 8 million international visitors are part-time residents, he said, and own property, buy cars and invest in local businesses.
"That’s a big part of the economic diversity in the state of Florida," Mr. Sanchez said. "This is important news for us."
The immigration proposal has also been a serious issue for real estate insiders like Jean-Charles Dibbs, a real estate partner at the law firm of Shutts & Bowen, who represents domestic and foreign clients who buy and sell luxury waterfront single-family homes and condos.
In the wake of 9/11, Mr. Dibbs said, he has had to move a significant amount of foreign-owned real estate – both vacation homes and income-producing properties. But balancing the demand to sell is a surge of buyers predominantly from Argentina, Colombia and Venezuela, many who move here with large investments.
International clients make up 75% of Mr. Dibbs’ business.
In the past six months, Mr. Dibbs said, he has handled transactions of properties valued from $2.7 million to more than $5 million. Most are in Key Biscayne, South Beach or the islands along the Venetian Causeway and the demand for waterfront property has cause a "feeding frenzy," he said.
Toni Schrager, a long-time high-end real estate agent and one of the founders of Avatar Real Estate Services, agrees that many luxury buyers are from Argentina, Colombia and Venezuela, as well as Brazil and Mexico. Attitudes are split, though, with as many buyers and sellers taking a conservative stance, as are those who are operating like it’s "business as usual," she said.
For real estate agents, the visa issue created "nervousness," Ms. Schrager said.
"We didn’t see mass selling, but there was an undercurrent," she said. "Realtors talked about a concern."
Still, among property owners a greater concern revolved around the ramifications of selling.
"Many are afraid that they won’t be able to get back in the market if they sell, that prices would become much higher than they are comfortable with."
"There’s a lot of uncertainty," she said. "But Miami seems to have its own economy. You can’t compare us to other places."
"It’s a microcosm here. Miami is already the capital of Latin America," Mr. Dibbs said. "The economy is largely dependant on South American investment. We can be in a recession countrywide and my business will not feel it because of the investment coming from South America."
Mr. Dibbs said he keeps asking himself when the bubble might break.
"So far, it hasn’t slowed down. Interest rates are low and Miami is positioning itself as a world-class city and a cultural Mecca… It’s causing a lot if people to take notice."