Category Archives: snow birds

Planning to buy a snowbird retreat in Florida?

Florida’s housing market is constrained by tight inventory which is not likely to improve significantly due to several challenges cited in a new report from Florida Realtors.

Chief Economist Dr. Brad O’Connor sees robust growth for the market with strong immigration and low unemployment in the state. Home sales are expected to gain 4% year-over-year in 2020, similar to 2019.

Last year, Florida saw an uptick in sales despite a 9% pullback from international buyers.

“It was exciting to see the almost 6% growth (5.9%) in closed single-family sales in 2019 from 2018,” O’Connor said. “Florida topped over $100 billion (total of “$101.9 billion) in volume in home sales last year, up 8.3% from 2018; for condo-townhouses, we reached $31.6 billion in volume, up 1.8% over the 2018 figure.”

But with new listings down 11.4% year-over-year for single-family homes and down 9.7% for condos, prices are set to rise around 4%, although O’Connor doesn’t see that as a problem currently.

“The median sales price still continues to rise, but looking at what the monthly mortgage payment is, that’s still a lot lower due to current historically low mortgage rates,” O’Connor said. “And that continues to drive sales and makes it a good time to buy.”

Supply side issues
The challenges to increased supply in Florida were discussed at the 2020 Florida Real Estate Trends summit during last week’s Florida Realtors Mid-Winter Business Meetings.

One of the panelists was Kristine Smale, senior vice president, Meyers Research, who says that there are three main factors restricting supply: higher construction costs, which moderated slightly in 2019 but are expected to rise again in 2020; a shortage of labor – 2019 had the largest amount of construction job postings since the Great Recession; and a lack of available, affordable land supply.

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Source: Canadian Real Estate Magazine – by Steve Randall 28 Jan 2020

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Snowbirds shut out of the market

Snowbirds shut out of the market

Canadians investors looking to get into the Florida real estate market are finding it increasingly tough to locate properties in the Sunshine State as younger buyers fuel demand, pricing others out of the market.

“There are definitely younger buyers coming into the market,” Doris Salazar, a real estate agent with the Elite Sales Group in Miami, told CREW. “The older people are heading up to North Florida in places like Vero Beach while the younger people are looking at condos and other home-types in Miami. There’s a lot more action from foreign buyers these days, especially from Canada and in the luxury market.”

Florida has consistently been a hotspot for older Canadians looking for investment properties but things have slowed over the last year as interest from young buyers grow and a sinking loonie compounds things.

As a result, Florida is now lagging behind California and Texas – all states without state income tax requirements. However, some are finding it increasingly difficult to locate affordable properties.

“The problem that Canadians are having right now is not the fact that they don’t want to buy here; it’s that they are being priced out of the market like everybody else,” said real estate agent and investor Brent Leathwood in a recent article in the Globe and Mail.

The influx has resulted in a lack of inexpensive properties in quality locations, which is subsequently driving up prices for old homes, lessening the price gap for a new home. What’s more, more than 85 per cent of Canadian buyers paid cash and many aren’t affected by a low Canadian dollar.

According to the National Association of Realtors (NAR), Canadians make up 31.6 per cent of all foreign buyers, more than any other country in the world. What’s more in South Florida specifically, seven per cent of Canadians represent the buyers’ market.

The NAR did a study recently finding that half of Canadian buyers surveyed paid less than US $200,000 in 2014, with the mean price being $260,800, which is less than the $300,600 foreign buyers elsewhere shelled out.

Among those Canadian buyers surveyed, 53 per cent of their home purchases were for vacation homes, while 61 per cent and the majority of buyers planned to use the properties for three to six months out of the year.

Source: Canadian Real Estate News, Jordan Maxwell 18 Jun 2015