Developer Joe Milton just put up millions of his company's cash to set up a mortgage company to fund loans and help his clients to close on units at the St. Tropez condominium in Sunny Isles Beach.
One of the reasons as well as a key factor in the recent rise in Miami and Miami Beach real estate is because foreign buyers are frequently locked out of the market if they aren’t cash buyers.
Milton is the president and chief executive of J. Milton & Associates in Coral Gables and says 60% of their buyers are foreign and up till now there are no loans being made to foreign nationals.
Even though foreigners have recently increased sales, Milton wants to make sure financing does not hold back even more Miami real estate sales.
The international sales director for Condo Vultures, Jenny Huertas says International buyers are stimulating this market and reactivating sales,
Those foreign buyers who may have once considered Miami and Miami Beach real estate out of reach see the meltdown of the regions once booming housing scene as an opportunity to invest.
The weak dollar is also working in their favor. Miami real estate and other area residential properties are selling for 50% less compared to peak prices., The euro, on Friday closed at $1.473, which was a penny away from a 14-month high against the dollar.
In September the median home price in Miami-Dade fell to $190,900, down 30 percent compared to a year ago, the Florida Association of Realtors reported. The median price for condos fell 37% to $132,900.
All things together, this is a great opportunity for thousands of global buyers.
Chairman of Fortune International Realty, Walter Defortuna, said for the first time in his 30 year career it's cheaper to buy Miami and Miami Beach real estate than in major Latin American cities, such as Buenos Aires, Mexico City and large cities in Brazil.
$236 is the average price per square foot of a new condo in the trendy Recoleta neighborhood of Buenos Aires, according to Ariel Szeinbaum, general manager of 4RentArgentina.com.
New construction, in Miami's Brickell area, is selling for between $200 and $250 per square foot. In other parts of South Florida the prices drop significantly, especially on foreclosures and short-sales where lenders allow units to be sold for less than the mortgages owed against them.
Throughout the boom, foreign investors were enticed by developers and brokers seeking deposits and high sales commissions. They responded, and their presence helped drive development and prices to historic highs.
Even though foreign sales still outpace the activity of U.S. buyers, because the recession is global, brokers say the ranks of foreign buyers have been thinned.
Contributed by MLR Realty
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