The Miami Association of Realtors just reported that the current inventory of pending home sales has increased nearly 15% from one year ago. While several attributing factors have been noted for the rise in activity, one prominent change has been the increase in foreign buyer interest in the area.
Total Contract Activity- May 2011
The total volume of pending sale listings increased in the month of May nearly 29% over the previous year. Increased pending sales are a strong indicator of future sales, as pending sales generally close within 1-2 months of initial contract signing. While Miami single-family homes are currently driving this increase, Miami condo sales have been holding their own.
Miami real estate experts
point to the dramatic increase in international buyers over the previous year for such promising gains. South Floridaâ€™s real estate market remains one of the strongest in the country. In addition to the Florida marketplace, foreign buyers are driving activity in California, Texas and Arizona.
International Buyer Activity
According to the National Association of Realtors, the surge of foreign money into the U.S. real estate market surged by $16 billion in 2011, representing a 24% increase over 2010. The U.S. continues to retain the strongest international real estate interest among buyers. While the U.S. has always seen strong foreign interest, the increased inventory and lowered prices have caused an increase in purchasing activity. Foreign buyers are also taking advantage of favorable exchange rates, allowing them to take advantage of even greater property savings. With reduced pricing and favorable monetary conversions, foreign buyers are getting nearly double the discount on their purchases.
In addition to permanent international residents purchasing properties, many executives working within the U.S. on a temporary basis have been opting to purchase properties over renting, traditionally done in the past, due to the current pricing making the option more affordable.
Another contributing factor to foreign investment in U.S. real estate is the influx of international students seeking a college education. Many foreign families are purchasing properties for their children during their attendance.