For the first time, Colombians have become one of the five largest buyers of real estate in the United States, a “club” to which Mexicans, Chinese, Indians and Canadians also belong.
(Global Group builds a project for Millennials).
This data, released this month by the National Association of Realtors, an organization of residential property sales agents, shows the growing influence of investments from Colombia and Mexico in the US economy.
Colombians invested 1.3 billion dollars between April 2019 and March 2020 buying properties in this country.
(Real estate sector moves business in various industries).
That’s a 150% increase over the 800 million they invested during the same period last year. Investment by buyers in Mexico increased even more: it went from 3,700 million to 5,800 million in the periods analyzed.
COLOMBIANS LOOKING TO DOLLARIZE THEIR HERITAGE
“Colombians are buying more and more properties in the US, mainly to be able to dollarize their assets, since it gives them more security against the devalued peso,” said Alan Medellín, who from Colombia sells luxury vacation apartments in The Grove Resort & Water Park in Orlando (central Florida).
“This also allows them to prevent country risk and receive a guaranteed monthly income in dollars”Medellín adds in a statement provided by the communication agency Top of Mind. Medellín says that international buyers are interested in properties that they can rent to generate income with which to pay fixed expenses, including the mortgage.
(‘Real estate franchises grow in the country’).
The Grove has a hotel company that manages the apartments, They rent them to tourists from all over the world and the owner receives a guaranteed return by contract of 10% per year.
THE STOP OF THE PANDEMIC
The Covid-19 pandemic has brought economies around the world to a halt, for which will be difficult to exceed the 74,000 million dollars in sales that were made between April 2019 and March 2020 to citizens of other countries residing in the US with temporary or permanent visas and to foreigners living in their own countries.
The figure is 5% lower than the previous year due in part to the fact that the dollar continued its upward trend against the currencies from which most foreign buyers come, according to the report of the National Association of Realtors.
The pandemic has also negatively impacted real estate purchases by foreigners.
Most international air routes are not open and many of the visas that allow you to work and live in the US are frozen until 2021.
The latter is important because families that emigrate to the US generate many of the real estate transactions that take place in this country every year, experts say.
David Amaro, director of America Capital Markets at LS NYRC, notes that most foreign families seeking to settle in the US plan to buy a home in addition to starting or continuing their business and enrolling their children in US schools or universities. .
To get the “green card” that allows you to work, study and have a home in the US, there is the EB-5 investor visa. This visa requires investors to loan $ 900,000 to US developers, such as LS NYRC, who build projects that employ US workers.
After the investment, families receive the “green card” in approximately two years and recoup their investment, plus interest, in a period of approximately five years.
“These families are not only investing in their own future, they are also helping to stimulate the United States economy by investing in real estate and creating jobs,” Amaro said in a statement collected by Top of Mind.
This specialist is not surprised that Colombia is one of the main buyers of real estate in the United States, because in recent times “it has also become one of the countries with a very rapid growth of applications for the EB-5 visa” .
According to it, in 2018, requests for the EB-5 visa by Colombians increased by 47%.
A TREND THAT WILL NOT CHANGE
For Amaro, “there are many factors that are leading Latin American investors to turn their attention to the US and it is very likely that this trend will intensify in the coming years, as the pandemic has brought a lot of destruction to the economies. Latin American “.
And adds: “In the not too distant future, many families will look to move to the United States, looking for a little stability and that will generate more home sales.”
The National Association of Realtors report also reveals that many of the international buyers obtained mortgages in the US For example, 57% of Mexican buyers and 38% of Colombian buyers obtained a loan.
“The advantage of taking out financing at this time is that interest rates in the US have dropped considerably and the leverage allows them to have a better financial performance at the end of the year”, Medellín explained.
“The financing process is very simple since a pre-approval can be done in 48 hours. The entire process is online and up to 60 percent of the property value is financed.” Florida, according to the report, continues to be the preferred state for foreign buyers, including Colombians, with 22% of total operations, followed by California, with 15%. Foreign buyers of houses and condos in Florida come mainly from Latin America (35%) and Canada (29%).