Brazilians are back in South Florida real estate, this time as investors.
Amid political and economic instability, buyers from Brazil are picking up investment properties instead of second homes, Bloomberg reported.
Brazilians, who held the title of top foreigners searching for South Florida real estate for a consecutive 17 months, fell off the top five countries looking for properties in Miami earlier this year, according to the Miami Association of Realtors.
Now, Brazil is in the No. 3 spot. Wealthy Brazilians have long chosen Miami as the destination for their second homes (luxury condos). But now, some are turning to property management abroad as conditions in their home country make it especially difficult. Rents have fallen by 5.2 percent over the past year in Brazil, while rents in Miami were stable since the beginning of 2016. It’s also difficult to evict tenants who have stopped paying their rents, experts told the publication.
Miami-based TRX Residential wants Brazilian investors to nearly double its $140 million portfolio of apartments in the U.S., according to Bloomberg. It’s already purchased 510 apartments in Palm Beach and Broward counties, with plans to raise $30 million through investment and the rest via loans.
“That has become really popular, especially in Miami,” Ryan Severino, chief economist at Reis Inc., told Bloomberg. “If you are a wealthy individual, instead of buying one condo for that amount of money, you contribute with some other wealthy people into a fund. And then all of a sudden, instead of you just owning a condominium that sits empty for most of the year, you have a share of a rental stream from larger multifamily properties that start paying income right away.’” [Bloomberg]