Traditionally, Florida has been the No. 1 state in the country for foreign homebuyers, accounting for 23 percent of all sales to foreigners in the nation, according to the 2009 survey by the National Association of Realtors (NAR).
What’s really impressive is that Sarasota-Bradenton-Venice has captured 11 percent of all Florida sales, according to the survey, making us one of the top destinations for foreign homebuyers in the state. This is a significant increase over 2006, when our region captured only 5 percent of all foreign homebuyers in Florida, but not quite as strong as the 13 percent in 2005.
Biz941 research shows that sales to foreign homebuyers were up in Sarasota County in the 2007-2009 period we evaluated, but Manatee County sales to international clients continued to drop.
Marie Avery, a real estate agent with Re/Max Alliance Group and the chair of the Manatee Association of Realtors International Committee, says while the number of sales has gone down, lower prices have been drawing in foreign buyers lately, mostly for those who want second homes (as opposed to investors), and these buyers are helping “to prop up the local market.” Europeans are hearing about the great deals in short sales and foreclosures, says Avery, who does plenty of these sales to American buyers. But the bulk of her business to foreign buyers is not in that category, since short sales and foreclosures require a lot of patience and education.
Bill Geller, a certified international property specialist with Re/Max Platinum and the president of the board of the Sarasota Association of Realtors, says Sarasota is seeing a lot of activity, primarily from Canada and the U.K. “The exchange rate is favorable, and properties are downright cheap here,” he says. “Europeans traditionally buying in southern Spain and France have experienced declining values there compared to what they can get here.”
Patricia Tan, the international sales director for Prudential Palms, who sells under Your Global Agents, says she’s seeing about the same number of foreign buyers as a year ago but more are in the decision mode. “They believe the market has bottomed and their own economies are improving,” she says.
Other contributing factors are the increasing confidence foreigners have in U.S. real estate, the higher returns for investors (“This is the first time in several years that these properties could provide a cash return,” says Tan, who helps foreign buyers find tenants for their properties once they buy) and the fact that 67 percent of all foreign buyers pay cash, according to the NAR.
Still, the credit crunch is affecting foreign buyers who need a mortgage. The only large lender locally to offer international mortgage products is Wells Fargo, according to Tan, and occasionally community banks do as well. Many Europeans who want to buy in cash are taking out loans in their own countries, where the credit crunch is still a factor.
All in all, the market is looking up. “We’ll see continued interest as long as the U.S. dollar does not strengthen,” says Tan.
[ The Data ]
Top Countries of Origin of Homebuyers
SOURCE: NAR and FAR, 2009 survey
Miami-Fort Lauderdale-Miami Beach
Cape Coral-Fort Myers
SOURCE: NAR and FAR, 2009 survey