International homebuyers' captivation with Orlando drove foreign transactions up 20 percent in 2017
The charms of our City Beautiful continue to allure homebuyers from around the globe. In fact, Orlando in 2017 repeated as Florida’s second most desired destination of foreign homebuyers, and it captured 11 percent of the state’s market share. Only the Miami-Fort Lauderdale-Miami Beach area, which drew a whopping 53 percent of all Florida international transactions, topped Orlando.
“International homebuyers account for a significant segment of Orlando’s real estate industry,” says ORRA President Lou Nimkoff, Brio Real Estate Services LLC. "There were approximately 61,300 Florida homes sold to foreign nationals during the 2017 study’s 12-month period. Orlando’s market share of those sales calculates to nearly 6,750 closings, which is about a 20 percent increase over the estimated 5,600 international transactions in 2016.”
International buyers also contribute significantly to Orlando’s dollar volume statistic. Foreign buyer purchases tend to involve higher priced homes and accounted for 21 percent of Florida’s total residential dollar volume during the study period. That 21 percent equates to $1.9 billion when applied to Orlando’s $8.8 billion worth of home sales in 2017*.
There were five primary countries of origin for Florida’s international homebuyers in 2017: Argentina, Brazil, Canada, the United Kingdom, and Venezuela. Of those five countries, Orlando ranks as the #2 collective purchase location of choice for all but Canada. (In 2016, Orlando drew 29 percent of all buyers from United Kingdom and that country’s #1 popularity ranking.)
Orlando area international buyers in 2017 were mainly Latin American and Caribbean (37 percent), European (22 percent), and Asian (15 percent), but exactly who found Orlando attractive? By a large margin it was buyers from Brazil and Canada that flocked to Orlando. Those from Brazil were involved in 13 percent of Orlando’s international transactions, while Canadian nationals participated in 12. The United Kingdom and Venezuela each supplied 10 percent of Orlando’s international buyers in 2017.
According to Nimkoff, the increase in Venezuelan buyer activity stems from that country’s economic crisis and rapid inflation, which has caused many residents to flee or to find international markets for their assets. Nimkoff also points out that the decline in U.K. buyers can be attributed to the pound’s drop against the dollar, accelerated by that country’s vote to leave the European Union.
International buyers tend to purchase properties priced higher than an area’s median price, and they are very apt to use cash because they might not have the required U.S. credit to obtain a mortgage from a U.S. source. In fact, about 72 percent of all Florida’s international transactions in 2017 were all-cash, with Canadians (86 percent) most likely to have gone that route.
Orlando’s international buyers purchase properties for both vacation and residential rental purposes. Those from Argentina and Venezuela, in particular like to take advantage of Orlando’s steady stream of tourists and invest in a rental property while those from Canada and the United Kingdom were the most likely to purchase a property for vacation use.
With its mix of resort, urban, and suburban areas, Orlando is able to accommodate foreign buyers’ ever-changing location preferences. In 2017, fewer of Florida’s foreign buyers purchased a home in an urban area, with the share at 35 percent (40 percent in 2016). Thirty-seven percent chose the suburbs, which held steady from 36 percent the year before.
The percentage of international buyers who chose to purchase a home in a resort area of Florida increased a fraction in 2017, to 15 percent from 14 percent in 2016. A decade ago, 33 percent of buyers preferred a resort area; this drop is consistent with the declining share of Canadian and U.K. buyers (from 50 percent in 2008 to less than 30 percent in 2017), who traditionally prefer such locations. *through November 31, 2017