Foreign investors pour money into Miami, LA and Manhattan luxury homes
Foreign buyers dropped $7.5 billion on homes in the U.S. costing over $1 million, with a major chunk of those purchases in Miami, Los Angeles, and Manhattan, according to a new report. The report, which calculated purchases between March 2016 and March 2017, saw a nearly three-quarter jump in total foreign investment in U.S. luxury real estate from the 12 months prior.
Luxury brokerages Beauchamp Estates and Leslie J Garfield & Co., compiled the data.
Almost 40 percent of the purchases were done in those three cities, with Miami accounting for one quarter of the total. Los Angeles was next highest at 9 percent, and Manhattan was third with 3 percent.
The price-per-square-foot between the three cities was lowest in Miami, but foreign investors dominated the South Florida market. There, 80 percent of luxury Miami real estate is owned by foreign buyers, compared to 20 and 27 percent in Los Angeles and Manhattan, respectively.
In Miami, where 95 percent of those properties were bought with cash, many of those buyers came from South America. For homes costing $3 million and over, three quarters in Miami are owned by foreign buyers who paid cash.
Beauchamp Estates expects Miami to see a 40 percent growth in ultra-high net worth individuals through 2026 to 1,050 total, while New York and LA will grow by 30 percent each, to 8,541 and 4,095.
In LA, buyers seem to get more house for their buck. The average luxury home purchased was 11,211 square feet. That is smaller than Miami, but on average, the properties in LA came with two and half acres of land. Miami luxury homes, meanwhile, had less than 1 acre. Manhattan apartments had 4,276 square feet of outdoor space.
The most popular neighborhoods in New York were the Upper East Side, Greenwich Village and Tribeca. In LA, Beverly Hills and Malibu topped the list. In Miami, Miami Beach, Palm Beach and North Bay Road were the most attractive.
[Realty Biz] – Dennis Lynch