The U.S. state of Florida attracted the largest share of foreign buyers than any other state during 2013.
Data from Florida Realtors also confirmed that the state ended last year with more closed sales, more pending sales and higher median prices than during 2012.
The number of closed sales of single-family homes in the sunshine state was up 11.8 percent in 2013 over the 2012 figure, with pending sales (where contracts have been signed but not completed) up by an even more impressive 17.6 percent.
Latest figures from the Florida Realtors Industry Data and Analysis department also revealed the state-wide median sale price jumped 15.9 percent for the same period, to US$168,000.
Florida’s success is set against an improving picture across the U.S., with the National Association of Realtors (NAR) recording a national increase in the median sale price for single-family homes in 2013 of 11.5 percent compared to 2012. The median price reached US$197,100 for the year.
The figures show that not only are prices in Florida increasing faster than the U.S. average, making it an attractive location for those looking for capital gains from real estate investment, but that they still have some way to go before they reach the national median figure of US$197,100.
These two factors have been responsible for a recent surge in foreign investment in Florida’s real estate, which data from the NAR Profile of International Home Buyers has shown accounted for 23 percent of the U.S. total.
The figure confirms Florida’s position as capturing the largest share of foreign real estate investment in 2013 of any state in the U.S., with non-resident foreigners accounting for US$6.4 billion of investment in the state in 2013.
Interestingly, the NAR data has also shown that foreign investors’ desire for ‘above-average properties’ means that they purchase more luxurious (and expensive) homes than the state’s median price.
The high-end three- and four-bedroom villas at The Fountains at ChampionsGate in Orlando (pictured) are just the type of property that foreign investors are searching for. With gourmet kitchens, outdoor terraces, a resort-style pool and a clubhouse within walking distance, the villas provide the luxurious standards that overseas buyers demand. Surrounded by pine and oak trees, they offer peace and seclusion in which to enjoy Florida’s year-round sunshine, yet Walt Disney World and Florida’s other attractions are just minutes away.
Orlando is one of Florida’s most popular areas when it comes to foreign real estate investment.
Philip Button, Managing Director of Brookes & Co, the property investment specialists who are presenting The Fountains to the market in partnership with leading developer Feltrim, explained: “Orlando has everything – a fantastic climate, world-class theme and water parks and some of the best golf courses in Florida.
“We’ve seen prices here increase by 24 percent during 2013, according to the Orlando Regional Realtor Association, and the picture continues to improve. It’s an extremely exciting time for those looking to invest in Florida’s real estate market.”
Despite the increase, prices in the Orlando area remain well below their median peak of US$264,000 in 2007, leaving investors excited about how much further prices may be expected to rise.
Their confidence has strong foundations. According to a recent report from BMO Economics, Florida’s GDP is expected to increase by 3 percent during 2014, the state’s job growth rate was up 2.6 percent year-on-year during December 2013 (against a national rate of 1.7 percent) and housing starts rose by 35 percent for the year.
By 2020, Florida’s population is expected to increase by some 1.9 million people, according to the University of Florida’s Bureau of Economic and Business Research. The increase will push the state’s population past 21.1 million, making it the third most populous state in the U.S. The increased population is expected to mean that Florida surpasses the population of New York in the near future.
With so many new residents needing housing, along with Florida’s record-breaking year for tourism in 2013, it’s no wonder that investors across the globe are so excited about the possibilities of the sunshine state’s dynamic real estate sector.
Andrew Batt, International Group Editor of PropertyGuru Group, wrote this story. To contact him about this or other stories email andrew@propertyguru.com.sg
Recent stories you may have missed:
Property bubble unlikely in Singapore: Citi
CapitaLand delays launch of Marine Parade project
Thailand crisis impacts Singapore property buyers
Singapore remains best in Asia for Quality of Living
If you have a property story you want us to publish email: andrew@propertyguru.com.sg