[1]
Go Global ….
Where are the International Investors?
By Patricia Tan
Despite recent strengthening of the U.S. dollar, interest in our area from overseas investors remains high. I am pleased to report that we continue to see very high levels of interest in our real estate market from overseas investors. This view is supported by my own recent experiences at a property show in London, England, and the experience of colleagues who attended a similar show in Paris, France. Both events were well attended by Europeans looking to purchase property in other countries. We showcased Sarasota and Florida’s beautiful Gulf coast, and educated visitors about the tremendous value and investment potential offered by our local real estate market.
Exchange rates for both the Euro and Sterling against the U.S. Dollar have weakened recently, so why the sustained interest from overseas? For sun lovers coming out of a dreary European winter, the attraction of a home in our balmy climes is not a hard one to sell, but this alone is not enough for the astute overseas investor. Many look for a combination of lifestyle and investment returns – both from rental income and capital appreciation, and they are finding this right here!
As residents we fully appreciate, but often take for granted, the benefits offered by our beautiful beaches and climate. The opportunities to pursue outdoor activities year round – boating, water sports, golf, tennis and more is not something our European cousins can boast. Sarasota’s position as the cultural center of Florida is also not to be underestimated. Many overseas residents plan their visits here around the opera season or film festival, for instance.
In many European countries, the range of homes available may be somewhat limited. Scarcity of land in heavily populated areas often forces residents to live in small condominiums where they yearn for the opportunity to own their own house and gardens. Architectural styles may be governed by tradition and history, rather than modern day tastes and convenience. Sarasota can offer many choices to the discerning buyer. Country club living, a contemporary home on the water, casual beachfront living, Gulf views, downtown convenience and so the list goes on.
Generally speaking, international investors see great value for money in our real estate offerings. However they look at price and value – size of home, location, condition, amenities on offer, potential for rental income, accessibility and desirability – these factors all stack up well in our favor. In particular, I see a lot of interest from overseas in foreclosures and short sales, as there is a general feeling that these properties offer the best value.
Foreign investors are also attracted by the transparency of our market. They appreciate the opportunity to make informed decisions about the true value of a property, based on real data and statistics, not on hearsay or personal opinion, as is the case in many other countries. Knowing that they are purchasing a property with good, clean title and one where all of the permitting requirements have been met is a key consideration.
While we may consider the U.S. tax regime to be punitive in some respects, it compares very favorably with those of many other countries. U.S. income tax and capital gains tax rates are much lower than in many other countries. If an investor gets the right tax advice prior to making a purchase, they can reap the benefits of greatly reduced tax liability in the future.
One of the things we need to be aware of when working with an investor from another country is that we are operating in a global marketplace, and the competition to win the investor’s business may not be coming from another town or state. The investor may be looking at several countries as possibilities for his real estate investment. For this reason, it is imperative that we understand what is happening in markets beyond our own shores and what our strengths and weaknesses are in comparison. That’s why I find attendance at overseas conferences and property shows to be an invaluable tool in building my personal knowledge so I am better able to serve the needs of an international purchaser.
Patricia Tan was born in England, and moved to Sarasota in 1997. Her career afforded her the opportunity to live and work in many countries around the world, including Australia, Hong Kong, Singapore, Malaysia, Indonesia, Germany, France, Belgium, Netherlands and the United Kingdom. She spent five years as a Director of an American real estate franchise in England in 1990s. Patricia has served as Chairperson of Sarasota Association of REALTORS®’ International Council, and serves on Florida Association of REALTORS®’ International Operations Committee. She currently works as International Sales Director for Prudential Palms Realty. Patricia may be reached at 941-487-5107 or patriciatan@prudentialpalmsrealty.com [2].
[3]