Florida’s recession could have been worse if not for homebuyers from other countries.
The nonprofit government watchdog group Florida TaxWatch says international buyers bought up cheap properties and pumped cash into the state’s economy.
The buyers were mainly from Canada, Latin America and Europe – all regular trading partners of the U.S.
“What the foreign buyers did is provide a lot of liquidity to people that wanted to get out of the Florida market," says Dr. Jerry Parrish, chief economist for Florida Taxwatch. "The main buyers are the same people that we do business with, and there’s a good chance that some of our high tourism numbers from certain countries is people coming back to visit their home.”
The National Association of Realtors supplied the data. Florida led the country in home sales to foreign buyers during the recession. Most of the sales were in Miami, Orlando and Fort Lauderdale. The homes ranged in price from large estates to small condos.
“A substantial amount are below $100,000 or below $200,000," Parrish says. "In a lot of cases, it’s families pooling their money together to buy maybe a vacation home here in Florida.”
Parrish says Floridians have a lower cost of living thanks to non-resident buyers who pay full tax rates. Those buyers don’t get homestead exemptions and they typically don’t use a lot of services, like public education.
Areas that have direct international flights benefit the most. Parrish says those flights lead to higher tourism, more home purchases, and more business development.
Florida is typically the top state for international home purchases, followed by California, Texas, and Arizona.