Mayfair International Realty Discusses the British Buyer With Aaron Kessler of the Sarasota Herald-Tribune

Brits like Florida for second home

By Aaron Kessler

Published: Monday, December 22, 2008 at 1:00 a.m. Sarasota Herald Tribune

Annette Reeve and Nick Churton, executives with London-based Mayfair International Realty, say more UK visitors are leaning toward Florida.

Michael Saunders & Co. brought in two executives recently from London-based Mayfair International Realty, which the company affiliates with abroad, to brief its agents on what British buyers are looking for, and how Florida is perceived on the other side of the pond.

Nick Churton, managing director for Mayfair, and Annette Reeve, its international director, sat down last week with the Herald-Tribune to share their thoughts on the current situation. Churton said during the last decade British buyers in search of a second home increasingly began considering the United States, and particularly Florida, and that in recent months America has become even more attractive.

Spain had largely been "Europe's Florida" for all intents and purposes, with its affordable prices, warmer weather and easy access. Discount airlines sprung up that offered fares from London to Spain for as little as $40 to $50.

"You could fly down there for less than it cost to take a train from London out of the country," Churton said.

The result was an enormous building boom, with houses and condominium buildings sprouting up in Spain's vacation hotspots. But the overbuilding and the speculation it brought with it, much like Florida, has now resulted in a bust as well -- with prices down an average of 89 percent over the last year in Spain, Churton said.

What is more, Reeve, Mayfair's international director, said an alarming trend of land grabs and housing scams in Spain has many British buyers thinking twice about whether the country can protect their purchases. Other trendy destinations such as Bulgaria and the Middle Eastern city of Dubai, have also made some buyers nervous.

"If they're going to be investing in a house in another country, they want to be protected," Reeve said. "They want governed places, where they can be confident things will be stable."

Recently, then, as the worldwide financial crisis has created even more anxiety about what the future might hold, British buyers have increasingly been looking toward the United States. While America is suffering from its own economic crisis, and the housing market in Florida is continuing to struggle, Reeve said the perception abroad is that the United States is taking aggressive steps to deal with its problems, and that there is little risk of law and order breaking down.

"Florida is deemed safe," Reeve said. "You don't have to worry about that kind of thing here. It's not like Spain where your house could be bulldozed."

Florida was not always at the forefront of British buyers' minds. But as Churton put it, "real estate purchases follow tourism," and in the last decade, more and more visitors from the UK have been heading to the Sunshine State.

'Great word of mouth'
You could say the market primarily breaks down into two categories: regular people, and the very rich. How they discover Sarasota turns out to be a bit different.

For the rich, Sarasota is becoming a well-known destination in Britain. Its beaches, welcoming downtown and in particular its vibrant art scene, have made the well-off UK buyer take notice. The stock of luxury properties also helps draw the million-dollar buyers in search of their vacation paradises.

"Sarasota has been getting great word of mouth in our luxury circles," Churton said.

When it comes to regular folks in Britain, the Florida experience has tended to evolve a little bit differently.

Reeve said the bulk of tour companies operating in the UK cater to one destination: Orlando. As a result, most British families looking to go on their first Florida vacation have perceived Walt Disney World as being synonymous with such a trip. But the other iconic image of Florida is the beach, and The Mouse is not on the coast.

"They'll get to Orlando, and after a few days at the Magic Kingdom, the kids are tugging at their shirts, saying they want to go to the beach," Reeve said.

What happens next can determine which coast the family favors from that point on -- will they become fans of Sarasota or Tampa, or will they instead come to favor the east coast?

"The most common thing that happens is they go up to the concierge at the hotel, and just ask how far it is to the nearest beach," Reeve said.

"They'll be told, well a couple hours this way and you're on the west coast, and couple the other way and you hit the east.

"And what generally happens is they'll wind up choosing the one that's on the same side of Orlando they're already on."

So in other words, large numbers of such visitors discover Sarasota almost by accident because they just happen to be staying at a hotel on the west side of Orlando.

Once they do come here, however, is not uncommon for them to fall for the place, and continue to return on future vacations -- forgoing Epcot Center and heading straight to Sarasota. Those trips then inevitably lead to thoughts of purchasing a vacation home in the area, and Churton said a fair number have done just that over the years.

However, during the Florida housing boom, Sarasota and other parts of the state became so expensive that many such potential buyers were priced out of the market.

Now that has all changed. With the median price in Sarasota-Bradenton last month clocking in at $169,000, affordability is back for a large swath of the population. That includes international buyers from Britain and elsewhere.

"So what's happened now is there's an incredible opportunity here," Churton said. "For those people who thought they had found their dream house and lusted after it, but just couldn't afford it?

"Now they can."

Immigration complications
For those looking to make purchases in Florida, they are almost exclusively second homes, Churton said.

That is partly a function of the market segment, but also because when buying in the United States, many British citizens and other foreigners have no other choice.

Because of U.S. immigration policies, they cannot simply pick up and move here -- they have to keep their home in the UK.

Churton said there have been some ideas batted recently around about whether that could ever change.

The National Association of Realtors, for example, proposed a special immigration status for foreign retirees seeking to spend their golden years in the United States.

"It was something along the lines of, instead of a green card, you'd have essentially a 'silver card,' so to speak," he said. "It would be a great idea, if it could ever happen."

Churton said it would open up the housing market here in Florida to many in the UK who would love to retire here and buy a house, much like Americans in Ohio or New York have done, but who simply cannot afford to maintain two homes on opposite sides of the Atlantic.

For now, those people will look instead at Spain or other places in Europe, where European Union rules allow them to relocate from Britain without a problem.

Reeve said the financial crisis has also led to more serious international buyers, and she said this coming season would like see very committed people looking for homes in Florida.

"Over the next six months, I think we're going to see a lot more of them," she said.

"This season, we won't see tire kickers coming over. The buyers now are almost all very serious about getting something done."