Florida’s real estate market has experienced strong tailwinds in recent years. Pandemic-era movers, no state income tax, and Florida’s warm climate have prompted people from around the world to move to the Sunshine State — especially those from non-U.S. countries. Offshore capital has proven to have a major influence on Florida’s real-estate market — in fact, Florida is the top destination for foreign residential real estate buyers, attracting over 20% of all international buyers. Although foreign investment is evidently providing Florida with economic growth, this is also creating concerns about national security. To safeguard all of us, Florida should establish a statewide foreign investment review board to monitor and guide offshore real estate buyers.
Florida has experienced an increase in real estate buyers from nations like Argentina, Russia and Venezuela. Foreign buyers’ investments have certainly helped Florida’s economy. Yet, with international political uncertainties worsening every day, it is crucial to establish a statewide foreign investment review board to evaluate the international individuals who are trying to buy real estate in Florida.
Establishing a statewide review board would improve Florida’s due diligence process on international buyers, in hopes of achieving better national security. The Committee on Foreign Investment in the United States (CFIUS) is a federal review board that monitors international investments in sectors like defense and tech. Real estate investment surveillance at the federal level remains limited. This means that Florida’s real estate market is not largely surveilled from an offshore-buyer perspective, which is becoming more and more important with Florida as the top state for international buyers.
A statewide review board would operate as a surveillance procedure that would mandate offshore buyers to report their source of funds, the motive of their purchase and their possible relations to any international governments. This due diligence process would enable Florida to detect any offshore-buyer purchases that might pose national security concerns. This would also enable the Florida government to monitor wider offshore-buyer trends, especially from countries with political turmoil.
This review board would also safeguard Florida residents. Offshore-buyers’ cash-heavy deals have threatened the Florida real estate market, as these transactions have raised home value prices across the state. Although offshore-buyers are not the only influence skyrocketing Florida’s home values, a review board could assist with monitoring any suspicious trends that could jeopardize Floridian residents. A review board could detect massive land acquisitions or any money laundering efforts that could further help Florida government officials with their policymaking.
Opponents of a review board argue that it will halt offshore-buyers’ investments. However, a review board does not need to be confining, nor does it need to end international investments. Florida can enact a system that will simply enhance transparency and improve its due diligence process to safeguard its own residents, as well as broader national security. In the process, such a board could also help foreign investors with red tape and sometimes arcane legal hurdles. It could be both a vetting mechanism and a clearing house structure to help both purchasers and sales.
Real estate is a prominent aspect of Florida’s economic growth, which is why the state should enhance its due diligence process for offshore buyers. A foreign investment review board would safeguard the state and country by ensuring that every international transaction is safe and monitored. Enacting a review board would ensure that Florida remains one of the world’s most coveted real estate markets.
Rita Shuster, a Miami native, is a senior at Stanford pursuing her bachelor’s degree in political science and her masters in communication.