trend by Pam McTeer | Contributor
An enticing exchange rate and a slumping real estate market has local Realtors looking overseas for its customers. The goal: Kick-start the market.
The British are coming.
Those words, when uttered by Paul Revere, signaled the battles of Lexington and Concord during the American Revolution back in 1775.
This time around, they may mean something different and far better: a rebound in Florida's real estate market.
With the exchange rate standing at .48 British pounds to one U.S. dollar and housing prices down 30% from about a year ago, it seems overseas investors and residents are in prime position to buy Florida real estate.
"What we're looking for there to be is a European invasion," says Greg Sheller, a Realtor with RE/MAX Gulfstream Realty. "It has put us into a position that America is a bargain ... It is a serious bargain."
The two-story Palmetto home that Nicola Seward-Cook and her husband Pierre Cook bought in August was appraised at $800,000 a year ago. They bought it for just under $500,000.
"We had this dream," says Nicola, a native of Great Britain. "We said, 'If the dollar ever reaches two to the pound, we were coming.'"
Their beige, Colonial-style home has three bedrooms in 2,600 square feet, a pool, a waterfront view and a full acre of backyard for their 11-year-old son to play. After they finish converting the garage into two bedrooms, the home will total more than 3,100 square feet.
Not a bad deal compared to their cottage in England, which had four bedrooms and 1,760 square feet. In U.S. dollars, it was valued at more than $1 million.
They were able to sell it and pay for their American home in cash.
Local Realtor and Britain Andrew Batty summarized the British demand for American real estate in three categories.
The first group comprises the people who often are looking for a better standard of living. They may not want to move now but eventually would like to relocate.
The second includes those who are looking to have a vacation or winter residence outside the UK. These individuals may want to rent out their home while they are away, and most in this category are moving to the Orlando area to be close to Disney World, Batty says.
The final group, investors, are still relatively modest in number, but Realtors hope to draw more through promotions, media coverage and even some innovative investment opportunities. Horizon Realty has initiated a special training program to teach Realtors to market to international clients through money conversion.
In November, 25% of Horizon's homes were purchased by foreign investors, split evenly between Canada and England, says Matt Agustyniak, the company's owner/broker.
He and other Realtors see the number of overseas sales increase and expect the number of foreign investors to climb during season. After visitors have traveled and seen what the area has to offer, they'll want to buy, he says.
Sheller and Batty, associates with RE/MAX Gulfstream Realty in Sarasota, are assisting with the Ascent 07 Florida Property Fund, a collaboration with investors in the U.K. to purchase homes and condominiums on the Florida Suncoast.
The demand for Florida real estate has dropped since a few years ago. Local Realtors attributes the change to media coverage and a subsequent hesitation by the British to invest in the American housing market. Many aren't yet confident that the housing market has hit rock bottom.
As Seward-Cook puts it, not everyone in the U.K. knows about the market conditions - yet.
Real estate agencies such as Horizon and efforts such as the property fund are helping to alert potential customers in the U.K. Horizon has its real estate magazines hand-delivered in London and offers a foreign investor program.
Moreover, the options for the British are nearly endless. Countries such as Spain, Portugal and Greece offer relocation benefits without having to leave Europe. South Africa, which has roughly the same flight time as to the United States, also has become a popular spot for relocation, Batty says.
"There's competition," he says. "At the moment, the United States doesn't compete particularly well other than its currency is weak and its housing market is weak."
But the European market, some British contend, already has been oversold.
"There's not the investment opportunity there that there used to be," Seward-Cook says. "You can get so much better value for your money here."
Florida's sunshine offers a glorious reprieve from Britain's typically cold, gloomy days, they say.
Statistics show that as many as 10% of British natives plan to relocate after retirement. So why not to Florida?
Some balk at or are limited by visa requirements and others simply don't feel welcome during the immigration process. But Realtors are hoping to overcome those fears, or at least make them worth forging through, by playing up the value of the dollar and U.S. housing market.
"If these people do start coming to this country, they could single-handedly kick-start the market in the United States," Sheller says.