Foreign Investments in Miami Real EstateMarch 10, 2017
With Donald Trump as the current president of the United States of America, the roles of figures on the political and business chess board have changed. No one can say with certainty that Trump’s policies will revitalize the nation’s economy, but it is evident that many opportunities are starting to arise, mainly because the US is finished with policing the rest of the world. This resolve has already softened relations with Russia, China, and many influential European countries; and money from foreign real estate investors is expected to pour into the Magic City as a result.
According to Knight Frank, a global real estate consultancy based in London, Russian interest in the US luxury real estate market has jumped 35 percent. Unlike Obama, Trump has drastically managed to improve relationships with Putin and he also has a long history of doing business with the Russian elite. With this in mind, it is no wonder why Russians are so pleased with the outcome of elections – it finally gave them the confidence to invest money in building infrastructure on American soil.
For instance, Vladislav Doronin, a prominent international businessman and realtor, has already paid a hefty sum of $54 million for realizing his 2-acre condominium project in Miami’s Edgewater neighborhood, and this is just one of many projects he is developing. Still, no matter how strong the Russians started to elbow their way into the scene, they are still overshadowed by Canadi10ans who currently spend the most on South Florida real estate and had enough time to make their empire.
On the other hand, many are wondering how Latin American investors are going to react to Trump’s proposed policies, especially since Miami is the unofficial capital of Latin America. “Building a wall” along the border of Mexico may represent the president’s blatant effort to forcefully repel any foreign economic influence, but the truth is, good business will always take precedence. The U.S. will remain an entrepreneurial haven for people from around the globe, which means Latin American money will surely continue to contribute to the luxury real estate development of Miami.
A very large percentage of buyers also come from Europe and South America. The reason money keeps pouring in from all corners of the world isn’t just because of Miami’s unique appeal and vibrant lifestyle, but the fact that the U.S. is the most secure country in which to invest. Trump’s presidency may have raised a lot of eyebrows, which even brought this title to question, but he is fully aware that uncertainty is the scourge of investment. Trade is a corner stone of his campaign because it leads to growth and employment, so there is no reason for him to deliberately prevent real estate workers from investing in Miami.
It still may take some time to digest Trump’s rhetoric, policies, and ethics, but it is expected that he will have a positive effect on the real estate industry. Realtors all over Florida hope that he will create more incentive to encourage real estate development and protect favorable real estate tax laws which are currently in place. If you look at things short term, the dollar is currently destabilized and the nation’s economy is looking a bit dim, but this is what creates opportunities for foreign investors and prompts them to act.
However, Miami has always been a magnet for investors for more than 30 years. Regardless of different presidents, political parties, values, and moods, the real estate business is pragmatic and clings solely to numbers and returns. If Trump reduces income tax rates, capital gains, and eliminates real estate tax, he will do a lot of people a favor, but South Florida will remain at the helm of luxury real estate development, with or without him.