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International Interest

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This year will be the 12th for Art Basel Miami Beach. Each year the event has grown and has continued to play an integral part in the development of South Florida’s artistic culture. This weekend, visitors can count on the festival to feature more than 250 of the world’s leading galleries.

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Art Basel creates a key opportunity for continued growth

Art Basel Miami Beach has become an international artistic spectacle with visitors, including many celebrities, coming from all over the globe to get a look at the newest trends in the art scene. Miami expects more than 60,000 visitors to attend the event this year. Of course, with international cash-buyers playing such a key role in the revival of South Florida real estate, Art Basel creates a key opportunity for continued growth.

Brokers will be able to highlight South Florida’s latest real estate development to Art Basel’s international guests. Condominium inventory is running thin, thanks in large part to international buyers who accounted for approximately 70 to 80 percent of condo sales during the latest boom. South Florida is compensating for the diminishing inventory with 175 new condo projects planned for the area that would be of great interest to overseas buyers.

With the evolution of Art Basel over the years, the festival is no longer solely taking place in Miami Beach. Events and showings connected with Art Basel are popping up all over Miami-Dade County, creating unique opportunities for brokers to mingle with VIP guests over a meal or drink. Private events can be the perfect place to develop relationships today that will help sell a luxurious space in a development months from now.

A sign of the spectacular mark that Art Basel has made in the development of South Florida’s culture can be seen in the opening of the Perez Art Museum earlier this week. The building itself was touted as a work of art and contained 500 pieces on display the day it opened. The future of the Miami art scene and its contribution to the development of our city is bright.

As we have previously discussed, the South Florida market is, for better or worse, in the midst of a development boom. The origins of this boom, however, may not be coming from the community itself. More and more it seems as though foreign buyers are the ones leading the climb back to prosperity for South Florida’s real estate market. Cash buyers from Brazil are at the top of that list.

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The Miami Tower shining for Brazil

In 2012, approximately 690,000 Brazilians visited Miami and injected $1.5 billion into the local economy. Brazilians officially overtook Canadians as the city’s top international tourists and, more importantly, the top international buyers of Miami real estate. This feat was made possible by the 123 weekly flights between Brazil and Florida, a number which is expected to continue rising before the end of the year.

Another factor that continues to stimulate Brazilian tourism in Miami is the extremely favorable exchange rate. What does this mean for those looking to invest in Miami’s recovering real estate market? For the same price of a property investment in Miami, buyers would end up spending nearly three times as much in Sao Paulo or Rio de Janeiro. Ironically, Brazilian buyers may have been driven to South Florida’s real estate market after the global crash in order to take advantage of softer pricing.

Not only did Brazilians lead the pack amongst foreign buyers of real estate last year, according to the Miami Real Estate Agents’ Association they represented 6 out of 10 foreign buyers. A good portion of the buyers (41.9 percent) intend to use their property as a vacation home for themselves and their families. On top of that, 78 percent of Brazilians paid for their property in all cash purchases, a trend that may prove troublesome for U.S. tax authorities in Brazil.

Brazilians have created a massive trend of investment in the South Florida real estate market, not simply because of the previously mentioned factors, but also due to their close-knit culture. Local brokers that have worked with Brazilians claim that if you can sell to one, you can sell to more, given that they tend to enjoy living near one another. This characteristic makes Brazilians a truly great friend for the South Floridian economy.