With weakening dollars for many international countries, less European and Latin American buyers are investing in Miami condos, but Asian and domestic buyers are investing.
Even as the number of pre-construction units, sale prices and rental prices increase, Miami’s real estate market is destabilizing itself. The condo market is reaching the point where supply is catching up with demand, as sales from Latin American investors are leveling out and construction costs are increasing.
Foreign investment fueled most of Miami’s condo market revival as foreign buyers are financing 50 percent or more of sales prices by the time the building was complete. However, weakened currencies in Europe and Latin America are causing many international buyers to withhold purchasing real estate, decreasing sales in Miami as they are negatively affected by the strengthening U.S. dollar. With China’s currency becoming stronger with the U.S dollar, Chinese investors will become a larger portion of Miami’s real estate market.
While fewer Latin American investors are purchasing real estate in Miami, a strengthening U.S. economy is allowing more domestic buyers to enter the market. Buyers from cities like New York, and Chicago make up about 10 percent of the current domestic buyers. Buyers from the West Coast are also looking in Miami in search of cheaper homes, mostly those whoa re older looking for retirement homes.
This market equilibrium will motivate those who are developing new construction to targeting domestic investors more as the international investors are less willing to come to Miami.
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