Commercially, Interest in the US market is high across regions, with the highest levels of investment coming from Canada, China, and Australia. This hierarchy is shifting though, as Chinese investment has surged over the past year with strong continued momentum making the Asia-Pacific investors lead the way. In the residential market, Florida remains among the top States for International buyers with 25% of all foreign purchases in the US, according to NAR 2015 Profile of Home buying activity of international clients. Miami and Ft. Lauderdale account for 50% of foreign sales. Orlando is right behind them and gaining momentum very rapidly placing it among the future world class cities attracting a large number of foreign investments. The top countries pouring money into Florida residential market are Venezuela, Colombia, Argentina, Brazil, China, Russia, France, India, and Canada. There has been a recent surge of demand from the other side of the planet including countries such as Saudi Arabia, United Arab Emirates, Iraq, and Qatar.
This article highlights the main reasons behind this attraction and love affair, both in residential and commercial real estate.
- Security: In comparison to other world economies, the US market is strong and reliable. It is considered as a safe place to park capital, even if returns are not stellar. Investors are usually looking for low risk opportunities.
- Stability: Foreign investors are all about minimizing risk and US properties offer steady yields that make sense for them in the current climate.
- Diversity: US transactions can involve multiple properties and large mixed use redevelopment schemes.
- Decreased friction: Thanks to the Real estate investment and jobs act of 2015, the tax burden imposed on foreign investors by Firpta (Foreign Investment in Real Estate Properties ACT 1980) may be considerably lighter.
- Guaranteed rights: The US has always been known for its welcoming policies to immigrants and foreign investors where everyone is entitled to own properties (no restrictions or limits). The foreign investor’s rights are as equal as those of local residents. Foreign Investors never have to worry regardless of the political or economic climate.
At world Properties Group, my team and I understand what it takes to help these buyers navigate through the entire process from tax laws and regulations to local market expertise. It is critical we understand objectives of these buyers to help them achieve their goals.
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Written by Mona L. Cherkaoui
International Real Estate Advisor, Speaker, and Trainer