Russian buyers suddenly warm to Miami real estate in a big way
Russian buyers have long been active in Miami real estate, but now they appear to be more interested than anyone else.
Searches originating from Russia topped the list of international interest in miamire.com, the official website of the Miami Association of Realtors, in November 2016. This is the first time Russia has led other countries in Miami interest since the association began tracking web clicks in 2013.
Brazil topped the list in November 2015, with Venezuela, Argentina and Columbia following. Russia came in fifth. A much stronger dollar may be a factor in pushing South Americans down the list, but a much stronger relationship between Russia's president, Vladimir Putin , and President Donald Trump may also be bringing in more Russian interest.
Following Trump's victory in November, Russian interest in the U.S. luxury real estate market jumped 35 percent, according to Knight Frank, a global real estate consultancy. Russian interest in the U.S. had dropped off dramatically in previous years, as the U.S. imposed economic sanctions on Russia.
"This is consistent with buying relationships with the new administration and Russia," said Jonathan Miller, president of Miller Samuel, an appraisal and research firm.
Trump not only has a better relationship with Putin than did President Barack Obama, but he also has a history of doing big real estate deals with the Russian rich. In 2004, he bought a distressed Palm Beach, Florida, mansion for $41 million and then four years later sold it to Russian billionaire Dmitry Rybolovlev for nearly $100 million.
"Without a doubt, the No. 1 [for the interest] is the fact that the Russians seem to be happy about the result of the election," said Christopher Zoller, chairman of the board of the Miami Association of Realtors. "Knowing what they think they're going to see going forward, I think that gives them more confidence."
Zoller also points to Russian developers currently pouring money and concrete into Miami. Vladislav Doronin is one example. The Russian-born developer recently paid $54 million for a 2-acre site along Biscayne Bay in Miami's Edgewater neighborhood where he plans a condominium project, one of several he is behind in the Miami area. This despite a glut of high-end condominiums already for sale or in development.
"I guess Russians figure, if these two billionaires are making a serious investment in Miami real estate, in the big picture, they should get on our website and see what they can afford," Zoller said.
The clicks have not turned into closed sales yet, he admits. For now, Canadians still spend the most on South Florida real estate. About 81 percent of Canadian buyers paid all cash for South Florida properties in 2016.