January 25, 2022 5:06 pm

Miami: Why Argentines Buy the Most Properties in South Florida

MIAMI.- The Florida Association of Realtors published the latest report with the profile of international buyers in the state’s real estate market, which covers the period from August 2020 to July 2021. The Argentines gave the note: they are the first buyers in volume of dollars in Latin America, and the second after Canada.

The volume invested by international buyers from August 2020 to July 2021 in Florida was 12,300 million, 5% of total market sales, and well below the 11% it captured the previous year. The pandemic and border closures contributed to the downfall of foreign investors.

Argentines bought for US $ 900 million, one place behind Canada -which disbursed US $ 1.8 billion-, but ahead of Colombia (US $ 800 million), Brazil (US $ 700 million) and Venezuela (US $ 400 million), according to Florida Realtors, the association that gathers more than 20,000 members in the state.

While the flow of Canadian investment fell by 44% in the last year, in the top 5 the only ones that increased their disbursement despite the pandemic were Argentines and Colombians. Other countries that spent more than the previous year were Mexico, Peru and Chile.

The study distinguishes two types of international buyers: type A, those who have their permanent residence in another country; and type B, recent immigrants who have been in the United States for more than 6 months. Type A buyer represents 71% of international buyers. This is the case of the majority of Argentine investors: 80% live permanently in their country, and only 20% declared themselves a recent immigrant (one who has lived on American soil for more than 6 months and less than 2 years) . It is the highest rate of non-resident investors, followed by Colombia (72%) and Venezuela (59%).

The pandemic added a seasoning to the national level, which in Florida was accentuated. The demand grew exponentially and the cost of properties went up. Until July of this year, sales of houses and condos in the state grew 30% compared to the previous year, while the average sale price was US $ 355,000, 20.3% more. Inventory also stayed tight. The market barely had a 1.2-month supply of single-family homes, while apartments and townhouses had a 1.8-month supply. The situation remains the same, with a slight increase in inventory since September.

Buyers from Latin America and the Caribbean make up the largest fraction of Florida’s foreign buyers, accounting for 46% of international sales, followed by Canadians (18%).

In Florida, between top 5 investors, Brazilians are the ones who typically buy the most expensive properties, with an average expense of US $ 460,700. Argentines are at the other end of the top 5, with an average of US $ 239,300.

The buyer profile varies by region. 65% of investors in the Miami to West Palm Beach area are Latin American, as is 55% from Orlando. Canadians focus on west coast beaches like Cape Coral, Naples and Sarasota, added to Port Saint Lucy; while Europeans also choose the west coast like Tampa and Clearwater, and also Jacksonville. 52% of all foreign buyers chose the Miami area to West Palm Beach, which continues to be the star of foreign investment. Argentines also stand out there: they are the most important buyers in the area.

De Miami a Palm Beach

Purchases in the last year were reduced by foreign investors due to the pandemic. In the case of Miami, 14% of the operations were linked to an outside investor, while in recent years it was around 35% to 32%.

According to the Miami Association of Realtors, Argentina leads the ranking of international buyers in South Florida, with 13% of the international market. It is followed by Colombia (12%), Venezuela (10%), Mexico (7%), Brazil (6%) and Chile (6%). Foreign buyers in Miami come from 43 countries.

Edgardo Defortuna, CEO and founder of Fortune International Group, says that Colombia and Argentina have always been very interested in this market over the years. “The circumstance of the pandemic, the health and rigid system that Argentina had of confinement, and the combination with its political and social problems makes South Florida attractive for people to invest here, live or spend more time“, bill. Unfortunate agrees that The Argentine usually turns to smaller apartments with attractive income, or that can be put on Airbnb. “Investments in departments that were previously more marginal began to generate more profit, and in comparative terms with the bank that gives you 1%, people turned to the real estate market. Even as a hedge against inflation. As investment units the smallest are the most profitable. The largest ones are usually for use, and the investor does not measure it in the return. In general, it is better for the Argentine to obtain an income because the exchange rate does not favor them. When the million dollars pass, the level of investment drops significantly and there begins to be more Brazilian or Mexican ”, he says.

The vast majority of Argentines bought condos to rent. Specifically in the Miami area, it stands out that 58% of Argentines bought to obtain an income, the highest number of foreign investors followed by Venezuela and Mexico. On the other hand, Brazil stands out as one who buys properties to have on vacation.

66% of purchases made by foreigners in Florida were in cash (without a mortgage), a figure higher than the national average (39%).

Sergio Pintos, vice president of sales for Waldorf Astoria, observes that the Latin American buyer began to demonstrate in recent months and gives a glimpse of the region. “For the type of properties that we commercialize, above a million dollars, the strongest market is by far Mexico, followed by Colombia. However, there are countries that are beginning to manifest themselves in this price range. For political reasons, Peru began to show itself, which in the last three or four months had an important boost. Chile is a group that was never a protagonist, the Chilean invested in his country. Today they are beginning to buy, and we are seeing Chilean companies and real estate companies that come to find out to offer Miami projects to clients in their country. Argentina was always the protagonist in Miami. Little by little it is beginning to have a little more participation in properties above one million. Brazil, on the other hand, which was crucial, today for pandemic and economic reasons is not appearing. I estimate that it will be reactivated in a few months when the borders are opened, if the dollar stabilizes. And the Venezuelan market that was very relevant today is practically disappeared ”, he synthesizes.

Most of their clients buy as a second, third or first residence. “The Argentine, on the other hand, seeks as an investment properties with a more attractive rate of return,” he explains.

While the domestic market pushes values ​​higher, Latin American clients are not resigned. Purchases continue, despite prices being 20% ​​higher than a year ago.

When analyzing, the five nationalities that most compared in the whole United States are: Canada (8% of international buyers, US $ 4.2 billion), Mexico (7% of international buyers, US $ 2.9 billion); China (6% of international buyers, US $ 4,500 M) India (4%, US $ 3,100 M) and the United Kingdom (4%, US $ 2,300 M)

Florida remained the top destination, with 21% of foreign buyers purchasing property in the state. Florida’s top buyers were from Latin America (34%), Europe (23%), and Canada (17%). It was the top state destination for UK and Canadian buyers.

California was the second largest state where foreign buyers bought properties. 47% of California’s foreign buyers are from Asia / Oceania. It was the top destination among Chinese and Asian Indian buyers.

Reference-www.lanacion.com.ar

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