2019 was a big year for Florida real estate. An analysis of the South Florida real estate market, current trends in the real estate sector and business opportunities for foreigners was recently presented at a conference entitled “Florida Real Estate Investments for Foreign Nationals “, organized by the Inter-American Chamber of Commerce USA – Mexico in Miami.
The event, held at the offices of the renowned international law firm Greenberg Traurig in Miami and sponsored by HSBC Bank and Inmobiliare, addressed crucial topics such as the particularities and inflections of the real estate industry in Miami, as well as the different financing options, legal and tax requirements for foreign entrepreneurs and buyers who wish to invest in real estate in the United States, particularly in Florida.
The panel was composed of four prestigious specialists from the real estate, banking and legal sectors; Mr. Andres Aguilar, senior mortgage consultant at HSBC; Mr. Gonzalo Cortabarria, partner at Exan Capital; Mr. Carles Farre, international tax specialist at KPMG LLP; and Mr. Michael Maxwell, partner and director of real estate developers and consultancy Maxwell + Partners.
During the conference the panelists discussed the remarkable investment potential in Miami in times when vacant real estate availability is low and demand is increasing, commercial and industrial property investments are growing and the city’s demographics are also steadily ascending. “While the general assessment is that the pace of new construction development in Miami has slowed and the market is trying to absorb what has been built in the last three years, there is great opportunity in condominiums and multifamily properties, the city’s population is growing and market studies are optimistic about the health of the market,” said Michael Maxwell.
Miami is evolving into a more urban city with a lifestyle similar to that of large U.S. metropolises where multi-use buildings and complexes are trending, something that is familiar to Latin Americans, especially Mexico. An example of this gradual transformation is the recently inaugurated Brickell City Centre shopping mall, a large-scale complex where commercial space, offices, residences and a hotel converge, all in the heart of the city’s financial district, giving new meaning to the experience of coexistence in a densely populated city area. “Most of the foreign investors to whom we offer consulting services show interest in investment properties, such as commercial spaces and multifamily buildings. They are looking for long-term investments, as they see the city’s progressive potential,” Maxwell said.
Adding to the city’s favorable economic and demographic growth are the benefits of the new tax law recently put into effect in the United States and Florida, which has had a major influence on the migration of multinational companies that are relocating to the southern part of the state. The effect has also attracted individual investors who, although they have no credit history in the country, can make use of the various financing options offered by banks and other financial companies, with competitive loans for the purchase of second homes and commercial properties, thus facilitating the investment process.
Andres Aguilar, senior mortgage consultant at HSBC Bank, explained the different financing options that the entity offers. “Usually to make a loan our bank requires between 25% and 35% down payment. Foreign loans are available for the purchase of residential or commercial real estate in the United States, and the down payment is almost always 25% for second homes and 35% for investment properties. We offer very competitive interest rates, ranging from 4% to 5.5%, and we also offer fixed interest rates.”
The most recent survey by the National Association of Realtors in the United States showed that Mexico was at the top of the list of nations with the highest number of real estate investments during 2017. In Florida, Mexico ranks 10th in foreign capital transactions in real estate purchases. Last year alone, Mexican nationals invested US $284 million in Florida properties, about 4% of the total foreign investments in the region, according to the Miami Association of Realtors.
