Florida has long been the top destination for international buyers of US residential properties, most recently accounting for more than one in five cross-border purchases during the pandemic.1
For this reason, we asked Brian Woods to share his recent observations and expectations in Florida and across the US. Based in West Palm Beach, Brian is currently licensed in five other states, with several more on the horizon.
1. Cash investors from around the world are seeking US properties
According to NAR, over 60% of non-resident foreign buyers used cash to purchase a US residence in the past year. Woods agrees that financing seldom presents a hurdle in cross-border US residential transactions—and many commercial transactions too.
2. Offices versus multifamily buildings
Declining office occupancy rates are continuing to fuel interest in multifamily properties, especially now that the US has ended its eviction moratorium.
In particular, Woods has observed strong interest in multi- and single-family properties coming from Dubai, UAE, and other Middle East nations, including Section 8 properties backed by the US government.
However, not everyone is shunning office buildings. For example, Woods has seen Hong Kong investors focused on US office properties occupied by local, state, or federal governments because they tend to hold long-term leases and don't default.
3. Infrastructure spending could alter the international landscape
As of this writing, it's too soon to say if one or both trilliondollar US infrastructure bills will be passed into law or how the bills will be financing.
However, some analysts speculate that ramped up US government spending could drive inflation and erode the dollar's value against foreign currencies. Such a shift would undoubtedly encourage growth in international property investments in the US.
4. The Sun Belt boom includes international buyers
According to US Census data, the five states with the largest population gains in 2020 were all in the south— Texas, Florida, Arizona, North Carolina, and Georgia. According to NAR, three of these states (Texas, Florida, and Arizona) were also among the top five destinations for foreign buyers.
As travel restrictions ease, Woods expects to see pent-up demand for second homes and investment properties surge all across the Sun Belt, and especially from Canada.
5. Environmental challenges in Florida
With more coastline than any other state in the contiguous US,2 the potential threat posed by hurricanes and rising oceans is a concern. However, a more immediate environmental threat is Florida's water quality.
Red tides (in marine waters) and blue-green algae (in freshwater) have become more persistent, creating a significant deterrent for people who favor Florida for its waterfront living.
Global Perspectives thanks Brian Woods, ABR®, AHWD, C2EX, CIPS, CRB, C-RETS, e-PRO®, GRI, MRP, PSA, RENE, RSPS, SFR®, SRES®, SRS, based in West Palm Beach, Florida for his assistance in developing this content.
1 Source: NAR’s 2021 Profile of International Transactions in U.S. Residential Real Estate, which reports on US existing home sales from 4-2020 to 3-2021.
2 Florida has 1,350 miles of coastline compared to 840 miles in California. But Alaska’s 6,640 miles of coastline clearly places it in the top spot among all US states.