Transcript Document

2013 Survey of International Home Purchases
Miami-Dade-Broward, Florida
Conducted by NAR Research for MIAMI Association of REALTORS®
Summary of Responses
Lawrence Yun, Senior Vice President
Jed Smith, Managing Director, Quantitative Research
Gay Cororaton, Economist
Data Gathered September/October 2013
Outline of Presentation
• About the Survey and Major Conclusions
• Survey Results
– Experience with International Transactions
– Buyer Characteristics
– Miami-Dade-Broward REALTOR® Designations
– Major Issues Reported by Miami-Dade-Broward
REALTORS®
• Summary of Key Findings
About the Survey
• Survey Conducted During Sept 23 –Oct 11, 2013.
• Questions Focused on Miami-Dade-Broward REALTOR®
Experience During Past Twelve Months.
• Invitation was sent out by Miami Association of REALTORS®
to its members
• Received a Total of 1044 responses.
Area of membership of REALTOR® Respondents
in Past 12 Months--2013 Miami-Dade-Broward, FL
Survey
Broward
16%
Others
1%
Miami-Dade
83%
Major Conclusions
• International sales are an important niche market for a number of MiamiDade-Broward REALTORS.®
• Survey data concerning transactions for the 12 months ended Sept-Oct 2013
indicates a slight increase in the volume of international transactions and
purchases and an increase in the purchase price.
• Majority of international clients are foreign residents (Type A). Resident
foreigners (Type B transactions) are also important.
• There are discernible differences between Miami-Dade’s and Broward’s
international clients regarding the volume of international transactions,
mode of contact , purchase price , type and area of property purchased, top
tier countries of client origin, and reason for buying
• Data indicates an increase in members who have less than 5 years of
experience.
• Many respondents hold designations (e.g., CIPS, CRS, GRI, BPO) and have 6
or more years of experience.
• The international market remains important though challenging for many,
requiring that REALTORS® deal with financing, language and cultural issues.
Miami-Dade-Broward REALTOR® Experience
with International Transactions
Most Miami-Dade-Broward REALTORS® Have Worked with an International
Client in the Past 12 Months
Percent of Miami-Dade-Broward REALTOR® Respondents Who Worked With an
International Client in Past 12 Months
100%
90%
80%
83%
75%
77%
77%
2012
2013
70%
60%
50%
40%
30%
20%
10%
0%
2010
The 2010-2012 surveys covered South Florida.
2011
A Larger Percentage of Miami-Dade REALTORS® Have Worked with an
International Client in the Past 12 Months
Percent of Miami-Dade-Broward REALTOR®Respondents Who Worked With an
International Client in Past 12 Months
80%
78%
78%
76%
74%
72%
71%
70%
68%
66%
Miami-Dade
Broward
Most International Clients are Non-Resident Foreigners *
But Share is Lower Compared to Past Years
Type of International Client Purchasing in Miami-Dade-Broward, FL
2010
2011
2013
70%
60%
Percent of respondents
60%
52%
50%
46%
44%
39%
40%
31%
30%
20%
8%
10%
8%
10%
0%
Type A
•
•
Type B
Both
Type A clients are non-resident foreigners. They reside in another country and do not plan
to live permanently in the United States.
Type B clients are recent immigrants/resident foreigners/temporary visa holders looking
for primary residence in the United States.
50% of Miami-Dade-Broward REALTORS® Closed Six or More
Transactions in 12 months ending Sept-Oct 2013
Percent of Respondents
Total Number of Transactions, Domestic and International,
Closed in Past 12 Months
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
2011
2012
2013
2012: 41% closed 6+ transactions
2013: 50% closed 6+ transactions
0
1 to 5
6 to 10
11 to 15
16 to 20
14%
14%
10%
42%
46%
40%
22%
18%
21%
8%
10%
12%
5%
6%
6%
More than
20
9%
7%
11%
Personal Contacts, On-line Presence, and Previous Clients Are Important in
Obtaining Foreign Clients
How REALTORS® Get International Clients
2012
2013
41%
Personal Contacts
26%
25%
Previous Clients
6%
5%
Business Contact Ouside Country
Business Contact in U.S.
1%
2%
15%
14%
Online Marketing
Newspaper/yard sign
Walk-in, open house, random call
Other
1%
2%
4%
3%
5%
7%
44%
Largest Source of Clients
Miami-Dade: Personal Contacts
Broward: Previous Clients
How REALTORS® Get International Clients
Miami-Dade
Broward
Personal contacts
23%
Previous clients
Business contact outside of the country
Business contact in the U.S.
6%
1%
2%
1%
14%
13%
Online marketing
Newspaper/yard sign
Walk-in, open house, random call
Other
47%
32%
1%
4%
2%
5%
5%
4%
40%
38% of Miami-Dade-Broward REALTORS® Had Six or More International
Clients in 2013
In Past 12 Months, Number of International Clients, Regardless of
Whether They Purchased Property
Percent of Respondents
25%
2012: 30% had at 6+ int’l clients
2013: 38% had at 6+ int’l clients
20%
15%
10%
5%
0%
2011
2012
2013
1
13%
18%
9%
2
15%
17%
14%
3
17%
15%
15%
4
9%
10%
11%
5
12%
12%
12%
6
20%
18%
22%
7
5%
4%
7%
8
3%
3%
3%
9
6%
5%
6%
About One-Third of Miami-Dade-Broward REALTORS® had a Majority of
Their Transactions with an International Client.
In Past 12 Months, Percentage of Transactions with an International
Client
Percent of Respondents
25%
2012: 21% had 51+% of transactions with int’l clients
2013: 35%
20%
15%
10%
5%
0%
0% (None) 1% to 5% 6% to 10%
2011
2012
2013
21%
24%
8%
21%
22%
21%
8%
8%
11%
11% to
15%
6%
4%
5%
16% to
25%
8%
8%
10%
26% to
50%
11%
13%
10%
51% to
75%
13%
10%
15%
76% to
100%
13%
11%
20%
37% of Miami-Dade-Broward REALTORS® Have Some Percentage of Their
International Business That is Commercial
Percentage of International Business That is Commercial
Percentage of Respondents
80%
70%
60%
50%
40%
30%
20%
10%
0%
0% (None) 1% to 5% 6% to 10%
2011
2012
2013
68%
68%
63%
17%
16%
20%
5%
5%
5%
11% to
15%
1%
2%
3%
16% to
25%
2%
3%
3%
26% to
50%
2%
2%
2%
51% to
75%
2%
1%
2%
76% to
100%
3%
3%
2%
Miami-Dade Has A Greater Percentage of REALTORS® Who Have Some
Percentage of International Business That is Commercial
Percentage of International Business That is Commercial
80%
70%
Percent of Respondents
60%
50%
40%
30%
20%
10%
0%
Miami-Dade
Broward
0%
(None)
61%
70%
1% to 5%
20%
20%
6% to
10%
5%
5%
11% to
15%
3%
3%
16% to
25%
4%
1%
26% to
50%
2%
0%
51% to
75%
2%
2%
76% to
100%
3%
0%
42% of Miami-Dade-Broward REALTORS® Were Involved in Both Residential
and Commercial Transactions
Percent of International Buyers Involved in both a Residential and a
Commercial Transaction
70%
60%
50%
40%
30%
20%
10%
0%
2011
2012
2013
0% (None)
1% to 5%
6% to 10%
63%
61%
58%
19%
21%
21%
4%
6%
6%
11% to
15%
3%
3%
3%
16% to
25%
2%
2%
3%
26% to
50%
4%
3%
4%
51% to
75%
2%
2%
3%
76% to
100%
3%
2%
3%
Buyer Characteristics
International Prospects Do Not Mean International Sales
71% of Miami-Dade-Broward REALTORS® Had International Clients Who Did Not
Purchase a Property
In Past 12 Months, Did You Have International Clients Who Chose Not to Purchase a
Property?
71%
62%
53%
2010
2011
51%
2012
2013
“Could Not Find a Property” and “Cost of Property” Were
Two Major Reasons for Not Purchasing
Why Clients Chose Not to Purchase
2012
2013
23%
Could not find a property to purchase
14%
Cost of property
Loss of home country benefits
2%
2%
Property taxes
Insurance costs
Exposure to U.S. tax laws
Immigration laws which prevent foreigners from living in the
U.S continuously year round
9%
5%
11%
7%
10%
6%
6%
8%
15%
14%
Could not obtain financing / Not able to qualify for mortgage
Other, please specify.
9%
11%
22%
28%
“Could Not Find a Property” Was Reported More in
Broward
Why Clients Chose Not To Purchase
Miami-Dade
Broward
26%
Could not find a property to purchase
Cost of property
Loss of home country benefits
Property taxes
Insurance costs
17%
1%
3%
10%
3%
4%
7%
Exposure to U.S. tax laws
6%
6%
Immigration laws
6%
6%
14%
15%
Could not obtain financing
Others
9%
9%
23%
37%
81% of Miami-Dade-Broward REALTORS® Had at Least One International
Client Who Purchased a Property
In Past 12 Months, Number of International Clients Who Purchased a
Property in the U.S.
Percent of Respondents
35%
2012: 67 percent
2013: 81 percent
30%
25%
20%
15%
10%
5%
0%
2011
2012
2013
0
1
2
3
4
5
31%
33%
19%
17%
16%
16%
14%
15%
19%
11%
10%
11%
5%
6%
8%
7%
7%
7%
6 to 10 11 to 15 16 to 20
9%
9%
12%
3%
1%
4%
1%
1%
2%
More
than 20
2%
2%
2%
Median Purchase Price of a Typical Client Up in 2013
Distribution of Purchase Price of the Properties Purchased by Typical Client
18%
2012 median price range: $ 200-250K
2013 median price range: $300
Percent of respondents
16%
14%
12%
10%
8%
6%
4%
2%
0%
$100,000
or less
$100,001
to
$150,000
$150,001
to
$200,000
$200,001
to
$250,000
$250,001
to
$300,000
$300,001
to
$400,000
$400,001
to
$500,000
$500,001 $750,001
$1,000,001
to
to
or more
$750,000 $1,000,000
2011
17%
16%
12%
12%
11%
10%
8%
7%
4%
5%
2012
14%
14%
14%
12%
11%
10%
9%
7%
4%
5%
2013
8%
11%
10%
11%
9%
11%
9%
11%
9%
11%
International Clients Typically Purchased at Higher Price in
Miami-Dade Compared to Broward
Median Price Range of International Buyers in Miami-Dade-Broward
$ 300,000 - $ 400,000
$ 200,000- $250,000
Miami-Dade
Broward
Condominiums: The Major Choice
Detached Single-Family of Increased Interest
Type of Property Purchased by Typical Client
80%
70%
60%
50%
40%
30%
20%
10%
0%
Detached singlefamily
2011
16%
2012
20%
2013
23%
Townhouse/row
house
9%
12%
9%
Condo/apt
Time-share
71%
64%
64%
0%
0%
0%
Commercial
Property
5%
5%
4%
Condominiums Are The Major Choice, But More so in
Miami-Dade
Type of Property Purchased by International Client
Miami-Dade
Broward
67%
50%
36%
20%
9% 10%
0%
Detached singlefamily
Townhouse/row Condo/apartment
house
0%
Time-share
4%
4%
Commercial
Property
Commercial Purchases Concentrated in Retail and
Multi-Family Properties
Type of Commercial Property Purchased by Typical Client
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
2011
2012
2013
Office
17%
21%
21%
Industrial
18%
17%
11%
Retail
24%
17%
24%
Hotel
9%
3%
5%
Land
2%
4%
6%
Multi-family
30%
39%
35%
Next to Multi-family-Miami-Dade: Retail Property
Broward: Office Property
Type of Commercial Property Purchased by International Client
Miami-Dade
Broward
38%
35%
21%
25%
23%
15%
15%
9%
5% 4%
Office
Industrial
Retail
Hotel
5%
4%
Land
Multi-family
70 Percent of Miami-Dade-Broward REALTORS® Report that Fewer than 10
Percent of International Clients Obtain a Mortgage
Percent of Transactions With a Mortgage
80%
Percent of Respondents
70%
60%
50%
40%
30%
20%
10%
0%
0-9%
2012
2013
72%
70%
10 - 19% 20 - 29% 30 - 39% 40 - 49% 50 - 59% 60 - 69% 70 - 79% 80 - 89%
6%
7%
4%
5%
4%
4%
2%
3%
5%
4%
1%
1%
2%
2%
1%
1%
90 100%
3%
4%
Most Buyers Purchased Property in a
Central City/Urban Area
Predominant Area in Which Typical Buyer Purchased a Property
70%
60%
50%
40%
30%
20%
10%
0%
2011
2012
2013
Central city/urban
area
63%
64%
66%
Suburban area
Small town/rural area
Resort area
19%
20%
20%
1%
1%
1%
17%
16%
13%
Most Buyers Purchased Property in a
Central City/Urban Area, More so in Miami-Dade
Predominant Area In Which Typical Buyer Purchased Property
Miami-Dade
Broward
69%
51%
36%
16%
13%
1%
Central city/urban area
Suburban area
12%
1%
Small town/rural area
Resort area
The Top Tier Countries of Client Origin
Distribution of Responses Regarding Countries of Origin of International Clients Who
Purchased Property
0%
2%
4%
6%
8%
10%
12%
14%
Venezuela
14%
Argentina
11%
15%
13%
12%
11%
Brazil
8%
8%
Colombia
Canada
8%
France
4%
Mexico
4%
4%
Italy
16%
3%
4%
5%
2012
9%
2013
The Second Tier Countries of Client Origin
Respondents also reported international purchases from these
countries:
Peru
Spain
United Kingdom
Ecuador
China
Honduras
India
Others, not identified
Russia
Dominican Republic
Chile
Germany
Costa Rica
Nicaragua
Panama
Miami-Dade and Broward Top Tier Countries of Client Origin
Broward: Top Countries of Client Origin
Miami Dade: Top Countries of Client Origin
14%
14%
12% 12%
11% 10%
8% 7%
6%
5% 4%
3% 3% 3% 3%
9%
7%
5%
4%
4%
3%
3%
The Second Tier Countries of Client Origin
Respondents also reported international purchases from these
countries:
Miami-Dade : Chile , Ecuador, United Kingdom, Germany
Honduras, China , Nicaragua , Costa Rica, India,
Others
Broward:
Costa Rica, Ecuador, France, Russia, Spain,
Germany, Mexico, Australia, Chile, Panama,
Japan, Nicaragua, Portugal, Others
REALTOR® Expertise and Comments
57% of Miami-Dade-Broward REALTORS® Have 6+
Years of Experience
Years of Experience as a REALTOR®
35%
2012: 66% had 6+ years of experience
2013: 57% had 6+ years of experience
30%
25%
20%
15%
10%
5%
0%
2011
2012
2013
Less than 1
year
10%
11%
21%
1 to 5 years
6 to 10 years
11 to 15 years
16 to 20 years
22%
23%
23%
32%
30%
25%
13%
16%
13%
7%
7%
8%
21 years or
more
15%
13%
11%
Miami-Dade Has A Greater Percentage of REALTORS®
With Less than 1 Year Experience
Years of Experience as a REALTOR®
Miami-Dade
Broward
22%
Less than 1 year
16%
23%
24%
1 to 5 years
25%
25%
6 to 10 years
11%
11 to 15 years
16 to 20 years
21 years or more
19%
8%
5%
11%
11%
Designations Held by Miami-Dade-Broward REALTOR®
Respondents in the 2013 Survey
Percent of REALTOR® Respondents Having Designations
0%
CIPS
CCIM
SIOR
RSPS
CRS
CRB
GRI
CLHMS
ABR ABRM
SRES
BPO
ePro
TRC
Other, please specify
5%
10%
15%
20%
25%
30%
35%
40%
45%
16%
4%
2%
5%
17%
3%
17%
9%
4%
4%
15%
12%
24%
44%
50%
41% of Miami-Dade-Broward REALTORS® Reported an Increase
in the Percentage of Clients Who Are International
Changes in the Percentage of Clients Who Are International in Past Year
60%
50%
40%
30%
20%
10%
0%
2011
2012
2013
Increased
Stayed about the
same
Decreased
49%
45%
41%
34%
41%
35%
9%
6%
6%
Not applicable, have
been in business less
than a year
8%
8%
18%
REALTORS® Reported Exchange Rates as Important in
Affecting the Demand for U.S. Property
Effect of Exchange Rates on International Clients
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
2011
2012
2013
Not much of an effect
13%
21%
20%
Moderate effect
40%
43%
43%
Very significant effect
47%
36%
37%
Profitability of Investment and Location Noted as Most Important Factors In
Purchasing a Miami-Dade-Broward Property
Most Important Factor Influencing a Purchase by an
International Client of a Miami-Dade-Broward, FL Property
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
2011
2012
2013
a secure
investment
(safety reasons)
a profitable
investment (yields
income)
40%
27%
28%
35%
34%
38%
a desirable
location (for
vacation, visits,
etc.)
20%
34%
31%
Other, please
specify.
5%
5%
3%
Most Important Factor For Purchase
Miami-Dade: Profitability of Investment
Broward: Desirable Location
Most Important Factor Influencing A Purchase
Miami-Dade
Broward
43%
38%
36%
31%
29%
16%
3%
a secure investment
(safety reasons)
a profitable
investment (yields
income)
a desirable location
(for vacation, visits,
etc.)
4%
Others
Major Comments Reported by Miami-Dade-Broward
REALTOR® Respondents in the 2013 Survey
• Miami-Dade-Broward is perceived as a highly desirable for location and
investment purposes.
• Costs of paying Home Owner Association fees, property taxes, and
mortgage insurance are a concern for foreign buyers.
• Access to U.S. financing is difficult; although most buyers pay cash,
REALTORS® may need to discuss credit issues with some potential buyers.
• Immigration requirements are a concern to some prospective buyers.
• Some potential international investors were reported as not being able to
buy property because of the low inventory of available homes.
• Language and diversity of cultures can be issues in completing
transactions.
– Diversity of expectations between potential purchasers and U.S. customs.
– Language capabilities important.
• Some REALTORS® noted an increased need for substantial expertise,
knowledge, and professionalism in dealing with international clients.
Summary
•
International Sales are a Significant Market for Miami-Dade-Broward for location
and investment purposes
•
Survey data indicates an increase in the volume of international transactions and
purchases in the 12 months ending Sept-October 2013:
-an increase in the percentage of REALTOR® respondents having 6+ international clients
(38% in 2013 vs. 30% in 2012)
-an increase in the percentage of REALTOR® respondents with 51%+ of their transactions
as international (35% in 2013 vs. 21% in 2012)
-an increase in the percentage of REALTOR® respondents who had at least one
international client who purchased property (81% in 2013 vs. 67% in 2012)
•
The majority of clients are Type A (foreign residents), but the share declined; only
67 percent of respondents reported Type A clients compared to about 72-76
percent in the 2010 and 2011 surveys.
Summary, Continued
• The price paid by a typical client increased; the median price in 2013 is
about $ 300,000 compared to the median price range of $ 200,000250,000 in 2012.
• Buyer characteristics
-
Venezuela, Argentina, Brazil, Colombia, and Canada accounted for 52
percent of reported international purchases;
Condominiums were more preferred than single- family homes,
accounting for about 64 percent of purchases ;
Mortgage financed purchases accounted for a minor portion of
international sales
• Many contacts are initiated via personal relationships.
– Although personal contact is most favored, online marketing is increasing.
– For REALTORS® with only an occasional sale, some study of foreign cultures
and customers can help to bring the transaction to a successful closure.
Summary--Continued
• Most Miami-Dade-Broward REALTOR® Respondents Have International
Expertise and Experience
–
–
Respondents reported having a variety of designations indicating
specialized expertise.
Approximately 57 % of respondents reported being in business for
more than 5 years compared to 66% in the 12 months ending Sept
2012.
• International sales market presents unique challenges.
- Learning another language can be an advantage.
- Personal contacts/referrals are necessary to building an international client base.
- Familiarity with tax /immigration/financing regulations is important.
- Foreign clients are discouraged by additional costs such as HOA and insurance fees,
so helping the client understand the rationale for these costs is critical.
End of Presentation. Thank you.