2020 florida international real estate profile

2020 Profile of International Residential Transactions in Florida

Photo: Nicky Torres

https://unsplash.com/photos/PGvg-gcHBgs

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FLORIDA REALTORS® | NATIONAL ASSOCIATION OF REALTORS®

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About the Report

Highlights

Economic Environment

Foreign BuyersSize of Foreign Buyer MarketOrigin of Foreign BuyersDestination of Foreign BuyersPrice, Intended Use, Location

Business TrendsClient TransactionsSeller TransactionsClients Searching for Property AbroadCultural and Language Issues

Appendix

Objective of the Report Since 2005, the National Association of REALTORS®

Research Group has conducted an annual survey for Florida REALTORS® to assess international investment trends in U.S. residential real estate, including sales volume, characteristics of foreign buyers, as well as challenges and opportunities inherent in cross-border transactions.

The 2020 Profile of International Residential Real Estate Activity in Florida presents information from Florida REALTORS® members regarding residential transactions with international clients closed during the 12-month period of August 2019–July 2020. In this report, the year 2020 refers to the above 12-month period, and the year 2019 refers to the period of August 2018–July 2019.

Who is an International Client?The term international or foreign client refers to two types of clients:

- Non-resident foreigners (Type A): Non-U.S. citizens with permanent residences outside the United States. These clients typically purchase property as an investment and/or for vacation, or visits of less than six months to the United States.

- Resident foreigners (Type B): Non-U.S. citizens who are recent immigrants (in the country less than two years at the time of the transaction) or visa holders residing for more than six months in the United States for professional, educational, or other reasons.

National Association of REALTORS®

Lawrence Yun, PhDChief Economist & Senior VP for Research

Gay CororatonSenior Economist &

Director, Housing and Commercial Research

Florida REALTORS®

Brad O’Connor, PhDChief Economist

Erica PlemmonsEconomist & Director of Housing Statistics

3FLORIDA REALTORS® | NATIONAL ASSOCIATION OF REALTORS®

ABOUT THE REPORT

Survey MethodologyFlorida REALTORS®, in coordination with the Miami Association of REALTORS®, issued the survey invitation to about 180,000 members. A total of 6,919 members responded to the survey over the survey period of August 15 – September 15, of which 1,078 reported a foreign buyer closed transaction during the reference period. Respondents are asked about the characteristics of the most recent transaction.

To correct for over- or under-response from members from a metropolitan area, the sample distribution of respondents was reweighted by a factor that aligns the sample distribution to the membership distribution across 22 metropolitan areas and one overall non-metropolitan area. See Appendix 2 on the sample and reweighted distribution of responses.


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HIGHLIGHTS1

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$15.6 BillionDollar volume of Florida’s existing homes purchased by foreign buyers during August 2019–July 2020, which is 11% of the dollar volume of Florida’s existing home sales (2% decrease from the prior 12-month level of $16 billion)

33,900Number of existing homes purchased in Florida by foreign buyers, which is 8% of existing-home sales (7% decrease from the prior 12-month period level of 36,400)

69%Share of foreign buyers whose primary residence is abroad (Type A)

Florida’s Top 5 Foreign BuyersCanada ($3.2 B)Brazil ($1.4 B)Venezuela ($0.9 B)Argentina ($0.6 B)Colombia ($0.5 B)

Top 5 Foreign Buyer DestinationsMiami-Ft. Lauderdale-West Palm Beach (47.3% of foreign buyers)Tampa-St. Petersburg-Clearwater (11.0%)Orlando-Kissimmee-Sanford (9.7%)North Port-Sarasota-Bradenton (6.9%)Cape Coral-Ft. Myers (4.7%)

$300,600Foreign buyer median purchase price ($263,400 for all Florida existing-homes sold)



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64%Foreign buyers who paid all-cash

66%Foreign buyers who intended to use the property for vacation, residential rental, or both uses

35%Foreign buyers who purchased condo or co-op units

89%Foreign buyers who visited Florida at least once before making a purchase

70%Foreign buyers who were referrals of personal and business contacts and former clients, or who were former clients

19%Respondents who reported clients (either non-U.S. citizen or U.S. citizen) seeking to purchase property abroad

38%Respondents who speak a language other than English

65%Respondents who “have not had problems” working with foreign buyers



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2ECONOMIC ENVIRONMENT

Coronavirus Pandemic Plunges Global Economy Into a RecessionThe coronavirus pandemic has plunged the global economy into a global recession. The International Monetary Fund projects the world economy to contract by 4.9% in 2020. Larger contractions are expected for Canada (-8.4%), the Latin American region (-8.4%), the Euro Area (-10.2%), the United Kingdom (-10.2%), and the United States (-8%).

Travel and Tourism Has CollapsedThe travel ban imposed by countries to control the spread of coronavirus has decimated the travel and tourism industry. Since April, tourist arrivals to the United States has fallen from about 5 million per month to less than half a million. During the period August 2019-July 2020, tourist arrivals fell by a third, from 78.8 million to 49.9 million. Tourist arrivals from Canada, Latin America, and Europe― the areas where most of Florida’s foreign buyers come from ― contracted by about 40%.

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ECONOMIC ENVIRONMENT


-4.9

-8.4 -9.4 -10.2 -10.2-8.0

-12.0-10.0

-8.0-6.0-4.0-2.00.02.04.06.0

GDP GROWTH RATES

2017 2018 2019 2020 ProjectionSource: IMF, July 2020 World Economic

Tourist Arrivals t o t he Unit ed St at esAugust - Ju ly 2019 August - Ju ly 2020 % Chg.

From all count ries 78,775,652 49,844,782 - 37%From Canada 20,861,729 13,239,702 - 37%From Lat in Am erica 7,238,818 4,257,966 - 41% From Argent ina 861,135 480,743 - 44% From Brazil 2,164,099 1,274,496 - 41% From Colom bia 974,732 541,941 - 44% From Venezuela 461,830 227,834 - 51%From Europe 15,659,222 9,196,637 - 41%Source: NTTO

534,214

- 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 8,000,000 9,000,000

JAN

/201

9

MA

R/2

019

MA

Y/20

19

JUL/

2019

SEP

/201

9

NO

V/2

019

JAN

/202

0

MA

R/2

020

MA

Y/20

20

JUL/

2020

MONTHLY TOURIST ARRIVALS TO THE UNITED STATES

Source: National Travel and Tourism Office


Decline in Non-immigrants VisasEven before the pandemic hit, the number of business and investor-issued visas had already been on the decline. Business (B) and Investor (E) visas fell from 8.6 million in 2015 to 6.5 million in 2019. Student (F) and exchange visitor visas (J) had also declined from one million in 2015 to 780,400 by 2019.

Fall in Oil PricesAs the global economy fell into a recession in the wake of the pandemic-induced travel bans and business closures, the demand for oil and oil prices has fallen, impacting economies that are dependent on the oil industry, such as Canada and Mexico. The spot price of oil (West Texas Intermediate) fell from about $60/barrel in 2019 to a low of $16/barrel in April, although oil prices have firmed up to $40/barrel as of September 2020.

Stronger U.S. DollarThe U.S. dollar has generally strengthened against other major currencies during the July 2019 to July 2020. The U.S. dollar had an average monthly year-over-year gain against the Canadian dollar (1.5%), the Chinese yuan (3%), euro (2.8%), and the pound (2.4%). However, the dollar has weakened since May 2020 as the U.S. continues to deal with rising coronavirus cases that poses a risk to the economic recovery.

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$39.59

$0$10$20$30$40$50$60$70

JAN

/201

9

MA

R/2

019

MA

Y/20

19

JUL/

2019

SEP

/201

9

NO

V/2

019

JAN

/202

0

MA

R/2

020

MA

Y/20

20

JUL/

2020

SEP

/202

0

SPOT OIL PRICE(WEST TEXAS INTERMEDIATE IN

$/BARREL)

Source: EIA

8,569,712

8,136,518

7,495,489

6,872,316

6,534,139

5,500,000

6,000,000

6,500,000

7,000,000

7,500,000

8,000,000

8,500,000

9,000,000

2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 8 2 0 1 9

BUSINESS (B) AND INVESTOR (E) ISSUED VISAS

Source: U.S. State Department

1,052,757

882,334

804,173771,798 780,400

700,000750,000800,000850,000900,000950,000

1,000,0001,050,0001,100,000

2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 8 2 0 1 9

STUDENT (F) AND EXCHANGE VISITOR (J ) ISSUED VISAS

Source: U.S. State Department

90

110

130

150

170

20

18

/JA

N

20

18

/AP

R

20

18

/JU

L

20

18

/OC

T

20

19

/JA

N

20

19

/AP

R

20

19

/JU

L

20

19

/OC

T

20

20

/JA

N

20

20

/AP

R

20

20

/JU

L

EXCHANGE RATE INDICES (JAN 2015=100)

Canadian$/US$

Yuan/US$

Euro/US$

Pound/US$

New Peso/US$


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Florida Residential Market TrendsLow mortgage rates and sustained job growth have boosted home sales and home prices. Demand has outpaced supply, leading to stronger price appreciation and buyer competition among all buyers, domestic or international.

In July, Florida’s existing home sales rose 11.5% and pending sales were up 20.3% year-over-year.

The state-wide median sales price for single-family homes was $295,000, up 10.1% from one year ago.

Like the overall U.S. market, Florida’s housing market is grappling with low inventory. Inventory for single-family homes was equivalent to 2.5 months of the monthly sales’ pace overall, with higher inventory in the condo market of 5 to 6 months of supply.


Relaxed Monetary and Fiscal PolicyTo prevent the economy from falling into a deep and long recession, the Federal Open Market Committee went into a swift and massive monetary policy accommodation, bringing down the federal funds rate to 0 to 0.25%, which has pushed down the 30-year fixed mortgage rate to a historic low of about 3% since July 2020. Congress also passed a $1.5 trillion CARES Act bill that provided funding to encourage small businesses to retain employees (Paycheck Protection Plan) and unemployment insurance to the unemployed who are not covered by the regular state programs. The unemployment rate has fallen from a peak of 14% in April to 7.9% as of September 2020, although it remains elevated relative to the pre-pandemic level of 3.5% in February 2020.

MEDIAN EXISTING HOME SALE PRICE (SINGLE-FAMILY AND CONDOS)

Metro area August-July 2019 August-July 2020 % Chg.Cape Coral-Fort Myers $235,000 $245,000 4.3%Crestview-Fort Walton Beach-Destin $290,700 $315,000 8.4%Deltona-Daytona Beach-Ormond Beach $215,000 $230,000 7.0%Gainesville $208,000 $224,900 8.1%Homosassa Springs $162,000 $170,000 4.9%Jacksonville $236,000 $252,000 6.8%Lakeland-Winter Haven $199,000 $214,447 7.8%Miami-Fort Lauderdale-West Palm Beach $280,000 $300,000 7.1%Naples-Immokalee-Marco Island $349,250 $358,000 2.5%North Port-Sarasota-Bradenton $271,900 $285,000 4.8%Ocala $163,000 $172,000 5.5%Orlando-Kissimmee-Sanford $250,000 $267,000 6.8%Palm Bay-Melbourne-Titusville $225,000 $240,000 6.7%Panama City $230,000 $249,075 8.3%Pensacola-Ferry Pass-Brent $215,000 $231,000 7.4%Port St. Lucie $235,000 $247,500 5.3%Punta Gorda $219,000 $232,000 5.9%Sebastian-Vero Beach $235,000 $245,000 4.3%Sebring $143,900 $155,000 7.7%Tallahassee $195,000 $210,000 7.7%Tampa-St. Petersburg-Clearwater $225,000 $240,000 6.7%The Villages $235,000 $255,000 8.5%Source: Florida REALTORS®


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3 FOREIGN BUYERS

Size of Florida’s Foreign Buyer MarketDuring August 2019‒July 2020, foreign buyer purchases of existing single-family and condominiums/co-ops in Florida decreased to $15.6 billion, a 2% decline from the previous 12-month level ($16 billion). 10% of respondents reported that they had an international transaction that did not close due to the coronavirus travel bans. The dollar volume of foreign buyer purchases accounted for 11% of Florida’s existing home sales, a decline from the prior period’s level (12%) and from past years when the share peaked at an estimated 57% in 2010. Nationally, foreign buyer purchases accounted for 4% of the dollar volume of existing home sales.

Foreign buyers purchased 33,900 existing homes, a 7% decrease from the previous 12-month level (36,400). Foreign buyer purchases were 8% of Florida’s existing home sales, a decline from the prior 12-month share (9%). Nationally, foreign home buyer purchases comprised 3% of all existing home sales.

12

FOREIGN BUYERS


17.1 17.3 17.414.5 15.7

23.7

19.4

24.2 22.9

16.0 15.6

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

DOLLAR VOLUME OF INTERNATIONAL SALES IN

BILLIONS OF U.S. DOLLARS

66.1 65.3

53.6

44.352.3

44.047.0

61.3

52.0

36.4 33.9

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

NUMBER OF INTERNATIONAL SALES IN THOUSANDS OF UNITS

27%23%

17%14% 15%

12% 12% 15% 13%9% 8%

57%51%

43%

28%19%

24%19% 21% 19%

12% 11%

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

FOREIGN BUYER SHARE TO EXISTING HOME SALES

As Percent of Florida's Home SalesAs Percent of Dollar Volume

Yes, 10%

No, 90%

PERCENT OF RESPONDENTS WHO REPORTED ANY

INTERNATIONAL TRANSACTION THAT DID NOT CLOSE DUE TO THE CORONAVIRUS-RELATED

TRAVEL BAN


Size of Florida’s Foreign Buyer MarketForeign buyers whose primary residence is in another country (Type A) made up 69% of Florida’s foreign buyers, a decline compared to the prior 12-month period (71%).

Among the major foreign buyers, more than eight in ten foreign buyers from Canada, the United Kingdom, and Argentina resided abroad (Type A).

40% of Florida’s foreign buyers who held a visa had a Type B2 visa and 22% had a B1 visa. EB5 visa holders accounted for 9% of foreign clients with visas. The large share of B2 visa holders indicates that a travel ban to the United States will have a big impact on the foreign buyer purchases in Florida and the United States. Nearly nine in ten foreign buyers had visited the United States at least once before purchasing a property.

13

FOREIGN BUYERS


91% 84% 82% 73% 69% 65%

NON-RESIDENTS (TYPE A) AS SHARE OF ALL FOREIGN BUYERS

69%

70%

68%

71%

69%

67%67%68%68%69%69%70%70%71%71%72%

2016 2017 2018 2019 2020

SHARE OF NON-RESIDENT FOREIGN BUYERS TO TOTAL

FOREIGN BUYERS

Visitor visas are nonimmigrant visas for persons who want to enter the United States temporarily for business (visa category B-1), for tourism (visa category B-2), or for a combination of both purposes (B-1/B-2). EB-5 Visa allows eligible investors and their family members to obtain permanent residency in the United States through an investment of $900,000 or more. EB-5 Visa leads to a permanent green card. The F visa is the most common visa used by international students. The J visa is for educational and cultural exchange programs.

42%

22%

9% 8% 8% 11%

VISAS HELD BY INTERNATIONAL CUSTOMERS


8%

21%

26%

19%

8% 10%

5%

4%

6%

20%

25%

21%

6%

12%

5% 4%

11%

23%

21%

16%

6%

11%

7%

4%

0 1 2 3 4 5 - 7 8 - 1 0 > 1 0

NUMBER OF T IMES INTERNATIONAL CLIENT VISITED FLORIDA BEFORE PURCHASING

2016 2019 2020

https://travel.state.gov/content/travel/en/us-visas/tourism-visit/visitor.html/visa

https://www.uscis.gov/working-in-the-united-states/permanent-workers/eb-5-immigrant-investor-program

https://www.uscis.gov/working-in-the-united-states/students-and-exchange-visitors

https://www.uscis.gov/working-in-the-united-states/students-and-exchange-visitors

Origin of Foreign BuyersLatin American/Caribbean buyers made up the largest fraction of Florida’s buyers, at 37%, but they made up a much smaller share compared to the previous 12-month period (43%). The second largest group of buyers were Canadians (21%), followed by Europeans (20%), buyers from Asia and Oceania (8%), and lastly Africans (2%). The origin of 13% of buyers was not identified by the respondents.

In terms of the number of foreign buyer purchases, the top countries of origin of foreign buyers were Canada (21%), Brazil (7%), Argentina (6%), Venezuela (5%), Colombia (5%), and the United Kingdom (5%). The fraction of buyers from these countries declined compared to the prior 12-month period, except that of the United Kingdom.

In terms of dollar volume, Canadians purchased $3.2 billion of property, followed by the Brazilians, $1.4 billion; the Venezuelans, $900 million; the U.K. buyers, $600 million; Argentines, $600 million; and Colombians, $500 million. The dollar volume of purchases of the top buyers all fell from the levels during the prior 12-month period, except in the United Kingdom and Venezuela where sales remained flat.

14

FOREIGN BUYERS


1%

10%

23%

39%

19%

8%

2%

8%

19%

43%

23%

5%

2%

8%

20%

37%

21%

13%

ORIGIN OF FOREIGN BUYERS

2016 2019 2020

$4.2

$3.0

$0.8

$1.5

$0.6 $1

.1

$3.3

$1.6

$0.9

$0.6

$1.3

$0.8

$3.2

$1.4

$0.9

$0.6

$0.6

$0.5

DOLLAR VOLUME OF FOREIGN BUYER PURCHASES OF EXISTING

HOMES IN FLORIDA AMONG MA JOR BUYERS ( IN BILLION

DOLLARS)

2018 2019 2020



Canada Brazil Argentina Venezuela Colombia UnitedKingdom Mexico Germany France

2008 26.6% 2.4% 1.7% 4.7% 1.7% 21.2% 2.4% 6.7% 4.2%2009 25.9% 1.9% 4.6% 5.4% 1.6% 15.1% 2.4% 6.8% 4.6%2010 35.1% 3.0% 1.5% 4.1% 1.7% 15.1% 1.1% 5.0% 2.8%2011 39.1% 7.8% 3.3% 6.8% 2.6% 7.0% 1.7% 4.6% 4.1%2012 30.7% 9.3% 5.2% 7.5% 3.9% 4.6% 1.3% 3.7% 4.5%2013 29.6% 6.5% 5.5% 7.6% 3.2% 5.8% 0.5% 5.3% 3.2%2014 31.6% 5.7% 2.9% 3.4% 3.5% 7.0% 2.0% 5.4% 3.2%2015 11.1% 9.4% 6.7% 18.4% 7.0% 5.1% 2.3% 2.3% 2.6%2016 18.9% 8.7% 6.0% 7.8% 5.2% 6.2% 2.0% 3.3% 2.3%2017 22.0% 6.6% 4.6% 6.1% 4.5% 6.2% 2.1% 3.7% 3.4%2018 21.9% 9.4% 2.8% 5.3% 5.1% 5.3% 1.4% 3.4% 1.8%2019 23.0% 9.3% 6.0% 6.5% 5.5% 4.3% 3.1% 2.9% 3.0%2020 21.1% 6.7% 5.7% 4.8% 4.6% 4.6% 3.2% 3.2% 3.0%

21.1

%

6.7%

5.7%

4.8%

4.6%

4.6%

3.2%

3.2%

3.0%

0%5%

10%15%20%25%30%35%40%45%

FLORIDA'S MA JOR FOREIGN BUYERS


Destination of Foreign Buyers

While foreign buyers purchased property across the state, most foreign buyers were concentrated in Miami-Fort Lauderdale-West Palm Beach (47%), Tampa-St. Petersburg-Clearwater (11%), Orlando-Kissimmee-Sanford (10%), North Port-Sarasota-Bradenton (7%), Cape Coral-Fort Myers (5%), and Naples-Immokalee-Marco Island (5%).

16

FOREIGN BUYERS


Other Florida MSAs had less than a 1% share.

Miami-FortLauderdale-West Palm

Beach

Tampa-St.Petersburg-

Clearwater

Orlando-Kissimmee-

Sanford

North Port-Sarasota-

Bradenton

Cape Coral-Fort Myers

Naples-Immokalee-Marco Island

Jacksonville Port St. Lucie Lakeland-Winter Haven Punta Gorda

Palm Bay-Melbourne-

Titusville

Deltona-DaytonaBeach-

OrmondBeach

2016 52.1% 7.7% 11.5% 3.2% 3.5% 3.0% 2.5% 2.5% 0.6% 0.6% 1.2% 1.4%

2017 52.6% 8.5% 10.8% 4.7% 5.7% 2.5% 2.6% 1.8% 2.0% 1.0% 1.5% 1.6%

2018 53.7% 9.0% 9.4% 4.9% 4.7% 3.4% 2.5% 2.0% 1.6% 0.8% 1.7% 1.3%

2019 53.2% 7.1% 11.1% 4.9% 5.6% 3.4% 2.5% 2.0% 1.5% 1.8% 1.2% 1.7%

2020 47.3% 11.0% 9.7% 6.9% 4.7% 4.6% 3.5% 2.1% 1.7% 1.3% 1.3% 1.1%

47.3

%

11.0

%

9.7%

6.9%

4.7%

4.6%

3.5%

2.1%

1.7%

1.3%

1.3% 1.1%

TOP DESTINATIONS OF FLORIDA'S FOREIGN BUYERS

The share of Miami-Fort Lauderdale-West Palm Beach dropped to 47% from the prior 12-month period share (53%) given the decline in the share of Latin American/Caribbean foreign buyers who tend to purchase property in South Florida.


8%

14%

6%

11%

13%

9%

7%

26%

7%

7%

8%

15%

19%

19%

38%

33%

26%

11%

31%

7%

43%

43%

31%

54%

21%

47%

8%

12%

17%

18%

13%

43%

7%

14%

16%

28%

10%

26%

37%

45%

11%

44%

21%

36%

7%

31%

7%

20%

10%

18%

12%

10%

26%

13%

21%

14%

14%

31%

M I A M I - F O R T L A U D E R D A L E - W E S T P A L M B E A C H M S A

T A M P A - S T . P E T E R S B U R G - C L E A R W A T E R M S A

O R L A N D O - K I S S I M M E E - S A N F O R D M S A

N O R T H P O R T - S A R A S O T A - B R A D E N T O N M S A

N A P L E S - I M M O K A L E E - M A R C O I S L A N D M S A

C A P E C O R A L - F O R T M Y E R S M S A

J A C K S O N V I L L E M S A

P O R T S T . L U C I E M S A

P A L M B A Y - M E L B O U R N E - T I T U S V I L L E M S A

P U N T A G O R D A M S A

L A K E L A N D - W I N T E R H A V E N M S A

D E L T O N A - D A Y T O N A B E A C H - O R M O N D B E A C H M S A

ORIGIN OF FOREIGN BUYERS IN FLORIDA'S METRO AREAS

Africa Asia/Oceania Europe Latin America/Caribbean Canada Unknown

Destination of Foreign Buyers

Miami-Fort Lauderdale-West Palm Beach, Orlando-Kissimmee-Sanford, and Palm Bay-Melbourne-Titusville foreign buyers were largely from Latin American and the Caribbean.

Lakeland-Winter Haven, Punta Gorda, and North Port-Sarasota-Bradenton foreign buyers were mainly from Europe.

Port St. Lucie, Cape Coral-Fort Myers, and Naples-Immokalee-Marco Island foreign buyers were primarily Canadians.

Tampa-St. Petersburg-Clearwater, Jacksonville, and Deltona-Daytona Beach-Ormond Beach attracted a more diverse mix of buyers from Latin America, Canada, Europe, and Asia.

17

FOREIGN BUYERS



Major Buyers of Top Florida Destinations


16%11%

8%7%

6%6%

4%2%2%2%

2%2%2%2%2%

CanadaArgentinaVenezuela

BrazilColombia

MexicoFrance

ChilePeru

Russian FederationBolivia

Dominican RepublicEcuador

IsraelSpain

MA JOR FOREIGN BUYERS IN THE MIAMI-FORT LAUDERDALE-

WEST PALM BEACH MSA

28%6%6%

5%4%4%

3%2%2%2%2%2%2%2%

CanadaCubaIndia

United KingdomBrazil

GermanyItaly

ArgentinaChina- Mainland

ColombiaFranceGreeceMexico

Venezuela

MA JOR FOREIGN BUYERS IN THE TAMPA-ST. PETERSBURG-

CLEARWATER MSA

24%10%

9%8%

6%2%2%2%2%2%2%

BrazilCanada

United KingdomColombia

VenezuelaChina-HKSAR

China- MainlandChina-Taiwan

Dominican RepublicFrance

Netherlands

MA JOR FOREIGN BUYERS IN THE ORLANDO-KISSIMMEE-SANFORD MSA

26%14%

4%4%4%4%

3%3%

CanadaUnited Kingdom

ChileCzech Republic

FranceItaly

China- MainlandGermany

MA JOR FOREIGN BUYERS IN THE NORTH PORT-SARASOTA-

BRADENTON MSA

37%14%

7%5%

2%2%2%2%2%2%2%2%2%2%2%

CanadaGermany

United KingdomColombiaAustralia

China-HKSARCuba

Czech RepublicEcuador

FranceIndiaItaly

MexicoMontenegroNetherlands

MA JOR FOREIGN BUYERS IN THE NAPLES- IMMOKALEE-MARCO

ISLAND MSA45%

19%5%

2%2%2%2%2%2%2%2%2%

CanadaGermany

VenezuelaArgentina

BoliviaChina-Taiwan

Costa RicaEcuador

GuatemalaItaly

SwitzerlandUnited Kingdom

MA JOR FOREIGN BUYERS IN THE CAPE CORAL-FORT MYERS MSA


Destinations of Florida’s Top Foreign Buyers


89%

4%

2%

2%

2%

2%

Miami-Fort Lauderdale-West PalmBeach MSA

Tampa-St.Petersburg-ClearwaterMSA

Cape Coral-Fort Myers MSA

Orlando-Kissimmee-Sanford MSA

Sebastian-Vero Beach MSA

Jacksonville MSA

DESTINATIONS OF ARGENTINE BUYERS

49%

35%

6%

2%

1%




Lakeland-Winter Haven MSA

Jacksonville MSA

DESTINATIONS OF BRAZILIAN BUYERS

37%15%

10%8%8%

5%4%

2%2%2%2%2%2%

Miami-Fort Lauderdale-West Palm Beach MSA

Tampa-St.Petersburg-Clearwater MSA


North Port-Sarasota-Bradenton MSA

Naples-Immokalee-Marco Island MSA


Port St. Lucie MSA

Punta Gorda MSA

Ocala MSA

Sebastian-Vero Beach MSA

Jacksonville MSA

Other FL County

Deltona-Daytona Beach-Ormond Beach MSA

DESTINATIONS OF CANADIAN BUYERS

21%

19%

12%

11%

8%

7%



Tampa-St.Petersburg-Clearwater MSA


Lakeland-Winter Haven MSA

Naples-Immokalee-Marco Island MSA

DESTINATIONS OF BUYERS FROM THE UNITED KINGDOM

64%

17%

6%

5%

4%

2%



Naples-Immokalee-Marco IslandMSA


Port St. Lucie MSA


DESTINATIONS OF COLOMBIAN BUYERS

74%

11%

5%

4%

2%

2%

2%

Miami-Fort Lauderdale-WestPalm Beach MSA




Port St. Lucie MSA

Jacksonville MSA

Palm Bay-Melbourne-TitusvilleMSA

DESTINATIONS OF VENEZUELAN BUYERS


PricesThe median purchase price among foreign buyers increased to $300,600. The median purchase price among foreign buyers was higher than the median purchase price of all properties sold in Florida.

6% of foreign buyers purchased properties worth over $1 million.

Brazilians tended to purchase properties in the higher price range, with a median sales price of $438,900, followed by Venezuelans, with a median purchase price of $352,300. Canadians and buyers from the United Kingdom purchased properties in the $250,000 to $300,000 price range.

20

FOREIGN BUYERS


$439K$352K $315K $273K $256K

$198K

MEDIAN PURCHASE PRICE AMONG FLORIDA'S MA JOR

FOREIGN BUYERS

$175K$211K $220K $237K $246K $263K

$297K$253K $259K

$287K $289K $301K

$0K$50K

$100K$150K$200K$250K$300K$350K

2015

2016

2017

2018

2019

2020

MEDIAN PURCHASE PRICE

FL Existing Home SalesForeign Buyers

20%

20%

39%

10%

5% 5%

1%

17% 22

%

38%

10%

6% 5%

1%

PRICE DISTRIBUTION OF FOREIGN BUYER PURCHASES

2019 2020


Financing64% of foreign buyers made an all-cash purchase. This is a slightly lower share compared to the prior 12-month level (67%) and five years ago (72%), given the decrease in the share of non-resident foreign buyers who tend to make an all-cash purchase.

Among the major foreign buyers, Argentines and Canadians were the most likely to make an all-cash purchase, because a greater fraction of them were non-resident buyers (91% of Canadian buyers and 84% of Argentine buyers).

Intended Use of Property66% of Florida’s foreign buyers purchased residential property for vacation, residential rental, or for both uses, a decline from the prior 12-month period (70%), which is in line with the decline in the share of non-resident foreign buyers (69% from 71%). Nationally, only 39% of all foreign buyers purchased properties for vacation or rental use.

21

FOREIGN BUYERS


90%

46%

83%70% 71%

62%

7%

45%

9%27% 29%

36%

7%

FINANCING AMONG FLORIDA'S MA JOR FOREIGN BUYERS

All Cash U.S. Mortgage

Home Country Mortgage Investors/Other

Don't Know

72%

23%

2% 2% 1%

67%

28%

2% 3% 1%

64%

29%

3% 3% 1%

FINANCING

2016 2019 2020


32%

28%

15% 21

%

1%

3% 3%

30%

25%

15%

21%

3% 3% 3%

30%

22%

14%

26%

2% 4% 3%

INTENDED USE OF RESIDENTIAL PROPERTY

2016 2019 2020

Canadians were the most likely to purchase a property for vacation use, while Argentines tended to purchase a property for residential rental.

Type of PropertyA higher fraction of Florida’s foreign buyers, at 47%, purchased detached single-family homes, an increase from 39% in the prior period.

Buyers from Brazil and the United Kingdom tended to purchase detached single-family homes, while buyers from Argentina and Venezuela preferred to purchase condominiums or cooperatives. A high fraction of Argentine buyers intended to rent out the condominiums.

22

FOREIGN BUYERS


21%

66%

25%41%

30%

70% 32%

9%

36% 11%17%

12%

15%

11%

13% 21% 22%

10%25%

11%21% 21% 26%

INTENDED USE AMONG FLORIDA'S MA JOR FOREIGN

BUYERS

Don’t KnowOtherStudent UsePrimary ResidenceBoth Vacation and RentalResidential RentalVacation Home

58%

21%48% 39% 33%

54%

14%63%

42%34% 52%

34%23% 12% 6%

24% 11% 9%

RESIDENTIAL PROPERTY PURCHASES OF FLORIDA'S MA JOR FOREIGN BUYERS

OtherResidential LandTownhouseDetached single-familyCondominium or Cooperative


44%

13%

39%

2% 3%

39%

12%

43%

3% 4%

47%

11%

35%

3% 4%

TYPE OF RESIDENTIAL PROPERTY

2016 2019 2020

Location PreferenceOnly 34% of Florida’s foreign buyers purchased in a central city/urban area, a decline from 43% in the prior 12-month period.

More than half of buyers from Venezuela, Colombia, and Argentina purchased a property in a central city/urban area. Canadians and buyers from the United Kingdom were the most likely to purchase a property in a resort area.

23

FOREIGN BUYERS


29% 26%35% 39%

30% 26%

47% 40% 36% 37% 43%34%

32% 37%27%

30%35% 39%

30%36% 38% 38% 34%

39%

8% 7% 5%6% 8% 10%

4% 10% 11% 10% 8% 11%31% 30% 32%

25% 27% 25% 19% 14% 15% 15% 15% 15%

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

LOCATION PREFERENCE

Central city/urban Suburban Small town/rural Resort

54%35%

16%

60%

17%

61%

29%

38%

44%

24%

43%

24%

5%12%

11%

6%

5%

6%11% 13%

27%9%

29%6%

LOCATION PREFERENCE AMONG MA JOR FOREIGN BUYERS

Central City/Urban Suburban

Small Town Rural

Resort


24

4 BUSINESS TRENDS

International Client TransactionsA lower fraction of Florida REALTORS®’ respondents—37%—worked with an international client (39% in 2019). Nationally, the fraction of REALTORS® who worked with a foreign client also decreased to 19%. On average, respondents who worked with an international client had five transactions, whether it concluded successfully or not. In the national survey, respondents reported less than one client on average.

Among those who worked with an international client, a higher fraction —42%—reported a decrease in their business that is international in the past year.

A higher fraction of respondents—26%—also expect a decrease in their international buyer client transactions in the next 12 months.

25

BUSINESS TRENDS


20% 19%

39% 37%

0%

20%

40%

60%

80%

100%

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

RESPONDENTS WHO HAD AN INTERNATIONAL CLIENT IN THE

PAST YEAR

U.S. Survey Florida Survey

27%

45%

28%

23%

52%

25%

42%

44%

14%

D E C R E A S E D S T A Y E D A B O U T T H E

S A M E

I N C R E A S E D

CHANGE IN THE PERCENTAGE OF BUYER CLIENTS WHO ARE

INTERNATIONAL IN PAST YEAR

2016 2019 2020

41%

36%

23%33

% 42%

25%28% 41

%

30%


S A M E

I N C R E A S E D

CHANGE IN THE PERCENTAGE OF BUYER CLIENTS WHO ARE

INTERNATIONAL IN THE PAST FIVE YEARS

2016 2019 2020

17%

27%

42%

14%

15%

31% 38

%

16%

26%

20%

35%

19%


S A M E

I N C R E A S E D D O N ' T K N O W

OUTLOOK ABOUT INTERNATIONAL BUYER CLIENT TRANSACTIONS IN

THE NEXT 12 MONTHS

2016 2019 2020


28%23%

14%9%

5%5%

3%2%2%

8%

Personal ContactsReferred by Previous Client

Was a Former ClientWebsite/Internet Organic Search

Website/Internet (Paid Ad)Walk-in/Open House/Phone Call

U.S. Business ContactBusiness Contact Outside the U.S.

Signs/Ads on Boards or YardOther

SOURCE OF REFERRALS OR LEADS ON FLORIDA'S FOREIGN BUYERS

Reasons Client Purchased PropertyAmong respondents who had an international client, the desirability of the location was the most important factor influencing a foreign buyer decision to purchase Florida real estate, cited by 47% of respondents.

How Clients View Florida Home PricesA third of respondents reported that their clients viewed Florida home prices to be less expensive compared to prices in their home country. A smaller fraction of respondents, 25%, reported that clients viewed Florida prices as more expensive.

Source of Referrals 70% of respondents reported that their buyers were personal or business contacts, former clients, or referrals from former clients.

26

BUSINESS TRENDS


26%

24%

44%

6%

21% 24

%

48%

8%

21% 25

%

47%

7%

S E C U R E I N V E S T M E N T

P R O F I T A B L E I N V E S T M E N T

D E S I R A B L E L O C A T I O N

O T H E R / D O N ' T K N O W

MOST IMPORTANT FACTOR INFLUENCING FOREIGN BUYER

DECISION TO PURCHASE FLORIDA REAL ESTATE

2016 2019 2020

43%

12% 23

%

22%32

%

14%

27%

27%33

%

14% 25

% 28%

L E S S E X P E N S I V E

T H A N P R I C E S I N T H E H O M E

C O U N T R Y

A B O U T T H E S A M E A S

P R I C E S I N H O M E

C O U N T R Y

M O R E E X P E N S I V E

T H A N P R I C E S I N T H E H O M E

C O U N T R Y

D O N ’ T K N O W

FLORIDA REAL ESTATE PRICES COMPARED TO HOME COUNTRY

2016 2019 2020


Reasons Client Did Not Purchase Property Not all transactions end up successfully: among respondents who had an international client, 35% reported the client decided not to purchase property, a decrease from the prior period (38%).

Among those who had a client who decided not to purchase property, the top reasons cited were “could not find property”, “cost of property”, “exchange rate”, and “condo fees.” Type A foreign buyers are more impacted by rising prices due to the exchange rate (when the dollar strengthens) and because they can’t benefit from the low U.S. mortgage rate as they typically tend to pay cash.

27

BUSINESS TRENDS


12%

15%

11%

10%

7%

7%

8%

7%

5%

4%

1%

5%

9%

13%

12%

10%

9%

8%

8%

7%

5%

3%

3%

2%

4%

16%

Could not find a property to purchase

Cost of property

Exchange rate

Condo fees

Cannot move money

Immigration laws

Could not obtain financing

Property taxes

U.S. tax laws

Insurance costs

Loss of home country benefits

Don't know

Other

REASONS CLIENT DID NOT PURCHASE PROPERTY

2019 2020

64%

65%

66%

55%

54%

52%

53%

47%

31% 33%

33% 38

%

35%

20

08

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

PERCENT OF RESPONDENTS WHO HAD ANY CLIENT WHO DECIDED NOT TO PURCHASE


Residential Sellers Respondents also worked with foreign clients who sold U.S. property.

Canadians were the major sellers of U.S. owned property, accounting for 29%, followed by the United Kingdom, 8%; Brazil, 7%; Colombia, 7%, and Germany, 5%.

44% of the sold properties were in the Miami-Fort-Lauderdale-West Palm Beach area.

The median price of properties sold was $278,900.

28

BUSINESS TRENDS


29%

8% 7% 7% 5% 4% 4% 2% 2% 2% 2% 2%

INTERNATIONAL CLIENTS WHO SOLD U.S. PROPERTY

2%2%2%2%2%3%

4%7%8%

10%12%

44%

Punta Gorda MSADeltona-Daytona Beach-Ormond Beach MSA

Palm Bay-Melbourne-Titusville MSALakeland-Winter Haven MSA

Port St. Lucie MSAJacksonville MSA

Naples-Immokalee-Marco Island MSACape Coral-Fort Myers MSA

North Port-Sarasota-Bradenton MSATampa-St.Petersburg-Clearwater MSA

Orlando-Kissimmee-Sanford MSAMiami-Fort Lauderdale-West Palm Beach MSA

TO P LO C AT I O N S O F S O L D P R O P E R T Y


Clients Seeking Property Abroad 19% of respondents reported they had clients―either U.S. citizens or non-U.S citizens ― who were interested in purchasing property abroad.

Clients were interested in purchasing properties in several Latin American countries such as Colombia, Costa Rica, Brazil, Mexico, Argentina, the Dominican Republic, Ecuador, and Venezuela.

Canada, Portugal, Spain, France, the United Kingdom, and the United Arab Emirates were also top countries of interest among clients seeking to purchase property abroad.

75% of respondents reported that their clients were interested in purchasing property for use as a vacation home and/or residential rental.

29

BUSINESS TRENDS


8%

6% 6% 5% 5%

4% 4% 4% 3% 3% 3% 3%

2% 2% 2%

TOP COUNTRIES OF INTEREST TO CLIENTS SEEKING TO PURCHASE

PROPERTY ABROAD

30%

13%

32%

15%

2% 3%

5%

INTENDED USE


30

BUSINESS TRENDS

Cultural and Language Issues

Most respondents—67%—reported no significant issues when working with international clients, with the rest reporting “few” to “significant” problems.

About a third of respondents reported they are fluent in a language other than English and 28% reported they were born outside the United States.


72% 66% 71%59%

51% 52%42%

67% 65% 61% 60% 65% 67%

25% 29% 27%35%

42% 43%50%

29% 32% 35% 36% 32% 30%

3% 5% 2% 5% 8% 5% 7% 4% 3% 4% 4% 4% 3%

CULTURAL OR LANGUAGE BARRIERS

Have Not Had Problems A Few Problems

Significant Problems

38%

0%

10%

20%

30%

40%

50%20

08

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

PERCENT OF FLORIDA REALTOR® RESPONDENTS WHO ARE

FLUENT IN A LANGUAGE OTHER THAN ENGLISH

63% 69% 73%83% 76% 70% 72% 75% 73% 71%

10%10% 8%

6%8%

9% 9% 8% 9% 10%27% 21% 19% 11% 16% 21% 19% 16% 18% 18%

BORN IN THE U.S.

No, but came to the U.S. at least 18 years old

No, but came to the U.S. before 18 years old

Yes, born in the U.S.


31

5 APPENDIX


Appendix 1Computation of Residential Purchases of Foreign Buyers in Florida for the 12-Month Period August 2019‒July 2020

Line Florida's Foreign Buyer Residential Purchases 1 Total U.S. Foreign Buyer Residential Purchases 154,000 2 Florida's Share to U.S. Foreign Buyer Residential Purchases (units) 22%3 Number of Florida Foreign Buyer Residential Purchases 33,900 4 Average Price of Florida Foreign Buyer Residential Purchases $460,9995 Dollar Volume of Foreign Buyer Residential Purchases in Florida $15,627,858,981

Florida's Residential Market for Existing Homes6 Florida's Residential Dollar Volume (Single-Family, Condo/Townhomes) $136,870,672,6457 Florida's Closed Sales (Single-Family, Condo/Townhomes) 403,577

8 Share of Dollar Volume of Foreign Buyer Purchases to Florida's Dollar Volume of Closed Sales 8%9 Share of Foreign Buyer Purchases to Florida's Closed Sales 11%

Notes:Line 1 Source: NAR's 2020 Profile of International Activity in U.S. Residential Real EstateLine 2 Source: NAR's 2020 Profile of International Activity in U.S. Residential Real EstateLine 3 Mutiply Lines 1 and 2Line 4 2020 Profile of International Residential Activity in Florida Line 5 Mutiply Lines 3 and 4 (Sales = # of units x mean price)Line 6 Dollar volume of closed sales for single-family homes, condominiums, and townhomes. Source of data: Florida Realtors®Line 7 Closed sales for single-family homes, condominiums, and townhomes. Source of data: Florida Realtors®Line 8 Divide Line 5 by Line 6.Line 9 Divide Line 3 by Line 7.



13%

6% 6%

7% 7%

5%

8% 9%

5% 5%

6%

22%

MONTH THE MOST RECENT INTERNATIONAL CLIENT PURCHASED PROPERTY

Appendix 3. The survey asks about the characteristic of the most recent international client who purchased property during the period August 2019-July 2020. The distribution of responses shows a high fraction of clients purchased in August 2019 and July 2020.

0 1000 2000 3000

Other (please specify)Sebring MSA (Highlands County)

The Villages MSA (Sumter County)Tallahassee MSA (Gadsden, Jefferson, Leon, and Wakulla counties)

Homosassa Springs MSA (Citrus County)Gainesville MSA (Alachua and Gilchrist counties)Sebastian-Vero Beach MSA (Indian River County)

Panama City MSA (Bay and Gulf counties)Ocala MSA (Marion County)

Lakeland-Winter Haven MSA (Polk County)Punta Gorda MSA (Charlotte County)

Pensacola-Ferry Pass-Brent MSA (Escambia and Santa Rosa counties)Crestview-Fort Walton Beach-Destin MSA (Okaloosa and Walton counties)

Port St. Lucie MSA (Martin and St. Lucie counties)Palm Bay-Melbourne-Titusville MSA (Brevard County)Naples-Immokalee-Marco Island MSA (Collier County)

Deltona-Daytona Beach-Ormond Beach MSA (Flagler and Volusia counties)Cape Coral-Fort Myers MSA (Lee County)

North Port-Sarasota-Bradenton MSA (Manatee and Sarasota counties)Jacksonville MSA (Baker, Clay, Duval, Nassau, and St. Johns counties)

Orlando-Kissimmee-Sanford MSA (Lake, Orange, Osceola, and Seminole counties)Tampa-St.Petersburg-Clearwater MSA (Hernando, Hillsborough, Pasco, and Pinellas counties)

Miami-Fort Lauderdale-West Palm Beach MSA (Broward, Miami-Dade, and Palm Beach counties)

METRO AREA OF RESPONDENTS

Reweighted Responses Responses

Appendix 2. To correct for over-or under-response from a metro area, the sample distribution of responses is reweighted to match the membership distribution.



Florida Realtors® Mission Statement

The mission of Florida Realtors® is to advance Florida’s real estate industry by shaping public policy on real property issues; encouraging, promoting and teaching consistent standards for ethical practice and professionalism; and building on the efforts of local Boards/Associations to provide the information and tools members need to succeed.

Florida Realtors® is the largest trade association in the state with more than 195,000 members.

Members enjoy business contacts, networking opportunities, educational offerings, research and legislative representation, programs, services, and tremendous camaraderie. The association headquarters is located in Orlando, and the legislative Office of Public Policy is located in the heart of Tallahassee.

Florida Realtors®’ elected leadership and business management teams share a common goal. Individually, each brings to the table years of expertise in the real estate industry and proven business management skills. As partners, they seek solutions to advance specific public policy issues and meet the needs of the state's Realtor® community.



The National Association of REALTORS® is America’s largest trade association, representing more than 1.4 million members, including NAR’s institutes, societies and councils, involved in all aspects of the real estate industry. NAR membership includes brokers, salespeople, property managers, appraisers, counselors and others engaged in both residential and commercial real estate. The term REALTOR® is a registered collective membership mark that identifies a real estate professional who is a member of the National Association of REALTORS® and subscribes to its strict Code of Ethics. Working for America's property owners, the National Association provides a facility for professional development, research and exchange of information among its members and to the public and government for the purpose of preserving the free enterprise system and the right to own real property.

NATIONAL ASSOCIATION OF REALTORS® RESEARCH GROUP

The Mission of the NATIONAL ASSOCIATION OF REALTORS® Research Group is to produce timely, data driven market analysis and authoritative business intelligence to serve members, and inform consumers, policymakers and the media in a professional and accessible manner.

To find out about other products from NAR’s Research Group, visit www.nar.realtor/research-and-statistics.

NATIONAL ASSOCIATION OF REALTORS® RESEARCH GROUP500 New Jersey Avenue, NWWashington, DC 20001202.383.1000


http://www.nar.realtor/research-and-statistics

36

2020 Profile of International Residential Transactions in Florida© NATIONAL ASSOCIATION OF REALTORS® and FLORIDA REALTORS®All rights reserved. Please email [email protected] or [email protected] for questions about this report. This report can be cited with the proper citation. Read the NAR citation guidelines.

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