Miami has long been a hotspot for foreign investment in real estate, attracting buyers from all corners of the globe. The local market offers diverse opportunities and can be particularly profitable. However, there is a lot foreign investors must know before starting. Keep reading to learn more about investing in Miami real estate.
Miami Real Estate Market Watch
Miami-Dade County has seen a year-over-year increase of approximately 32% for single-family homes. However, local real estate market trends are always changing. Connect with the Oscar Arellano Team for help buying and selling homes in the Miami-Dade area.
3 Things To Know Before Investing In Miami Real Estate
Eligibility
Understanding the eligibility criteria for purchasing property in Florida is essential. You can generally buy real estate in Miami if you're a foreign individual. Foreign investors can also buy if they're part of an entity like a Limited Liability Company (LLC) or corporation. Just ensure you have some key documents, like a valid passport. If you plan to rent the property for income, you may also need an Individual Tax Identification Number (ITIN). Investors may want to consult a real estate or tax attorney for more guidance.
Finance
Buying real estate in Miami as a foreign individual can be more complex than it is for U.S. residents. While you can look into traditional U.S. mortgages, they sometimes have stricter requirements. Lenders might request higher down payments and a more extensive check on your credit history. That's where specialized lenders come into play! They focus specifically on foreign investors and can offer customized mortgage rates and flexible terms. Exploring different financing options and comparing interest rates to find the best loan terms for your needs is always a good idea.
Tax Implications
Know the tax implications before proceeding. Florida treats foreign nationals and U.S. citizens the same regarding taxes. Investors will need to pay property taxes on any real estate they own.
If you plan to live in Florida, you might be eligible for a homestead exemption on your primary residence. However, this exemption does not apply to investment properties.
Additionally, you should know about the Foreign Investment in Real Property Tax Act (FIRPTA). This rule means that when a foreign investor sells a property, a portion of the sale price (usually around 15%) needs to be withheld. Think of it as an advance payment for any potential tax obligations.
Purchasing real estate in Miami is made accessible for foreigners. That is largely thanks to a relatively straightforward legal framework and a welcoming atmosphere.
Many foreign buyers appreciate the opportunity to secure property in a city known for its stability and growth potential. Additionally, many local banks are accustomed to working with international clients.
Are you ready to start your journey as a Miami real estate investor? The Oscar Arellano Team has the knowledge and experience to help you succeed. Check out our featured properties to find homes for sale in the Miami area. You can also contact us for advice and help navigating the market.
