South Florida’s real estate market, once a magnet for international investors, is experiencing a significant downturn as foreign buyer interest wanes. This shift is attributed to a confluence of factors including rising costs, stricter regulations, and evolving geopolitical and economic landscapes, leading to a historic decline in foreign investment and a surge in property inventory.
Foreign Investment Dries Up
South Florida’s condominium market, historically bolstered by international buyers, has seen a dramatic decline in foreign investment. Sales to foreign nationals have plummeted to their lowest levels in over a decade. In 2018, international buyers accounted for half of all condo sales, a figure that has now dropped to just 10 percent, according to the Miami Association of Realtors.
Key Takeaways
- Foreign buyer interest in South Florida real estate has fallen to a decade-low.
- Sales to foreign nationals now represent only 10% of condo sales, down from 50% in 2018.
- Canadian buyer interest in Southwest Florida has decreased by nearly 11% in online searches.
Multiple Factors Contribute to Decline
The retreat of foreign buyers is not due to a single cause but a combination of economic and policy shifts:
- Economic Factors: Currency volatility, a strong U.S. dollar, elevated interest rates, and international tariffs have made U.S. property less attractive.
- Policy Changes: Restrictive immigration laws and a perceived shift in the political climate have deterred investors.
- Post-Surfside Regulations: Following the 2021 Champlain Towers South collapse, new state laws mandate structural inspections and robust reserve funding. This has rendered many older buildings ineligible for conventional mortgages and increased the complexity of financing.
Rising Costs and Affordability Issues
Adding to the market’s woes are escalating costs for property owners:
- Insurance Premiums: A surge in climate-related risks has led insurers to reassess or exit the Florida market, resulting in significantly higher premiums.
- Homeowner Association (HOA) Dues: Increased insurance costs and maintenance requirements have driven up HOA fees, with some units seeing monthly dues rivaling mortgage payments.
Market Correction or Long-Term Shift?
Sales data indicates a broader cooling trend across Florida’s housing market. Condo and townhouse sales dropped 9.2% in the first quarter of 2025 compared to the previous year, while active listings are up 35%. Nearly a third of homes are now selling below asking price. While some industry experts believe the new regulations will ultimately lead to a more stable condo sector, the immediate future remains uncertain as the market grapples with reduced foreign interest and domestic affordability challenges.
Sources
- Florida’s property woes increase as foreigners abandon Sunshine State, MPA Mag.
- Cape Coral realtors face challenges as Canadian buyer interest wanes | Lee County, Wink News.
- Foreign Buyers Step Back From South Florida Condos, The New York Times.