Following the massive deportation policy of the Donald Trump administration, the real estate market in Miami, Florida, is sharply declining. While the overall U.S. real estate market is slowing down due to high loan rates and rising home prices, Miami is experiencing an even greater hit.
On the 7th (local time), a report from Bloomberg, citing data from the real estate company Redfin, indicated that the number of housing transactions in Miami in March decreased by 17% compared to the previous year. This represents a level approximately six times the national average decline in housing transactions. Rental prices for dwellings in Miami are also showing a downward trend, with rents for one-bedroom apartments having decreased by 16% over the past year.
The duration homes remain on the market is about 100 days, more than double the U.S. average. This indicates a significant drop in the number of people searching for dwellings. A Miami real estate agent recently noted that two-thirds of their clients have given up on their purchasing plans in the luxury apartment market in the Brickell area.
The reason for the stagnation in the Miami real estate market is the Trump administration's deportation policy. President Trump signed an executive order on his first day in office to prevent the illegal entry and settlement of immigrants, and since February, some illegal immigrants have been transported to the Guantanamo Bay detention camp, which previously housed terrorists. Given that nearly half of Miami's population is foreign-born, it is interpreted that the city has reacted more sensitively to the deportation policy.
Bloomberg explained, "Even legal immigrants are experiencing paralysis in the Miami real estate market due to concerns about the changing immigration policies." In fact, Miami real estate agent Maruja Gil stated, "People looking to buy or rent dwellings are worried that their visas may not be extended next year or next week, and this is negatively impacting the market."
Another real estate agent mentioned that not only has the demand for dwellings from visa holders significantly decreased, but some homeowners without permanent residency are selling their properties in Miami to buy homes in Europe or Latin America. An immigration attorney reported that the number of foreigners looking to invest over $1 million (about 1.4 billion won) to obtain investment residency has sharply decreased.
Florida has implemented strong immigration enforcement as a way to support the federal government's immigration policies. Florida Governor Ron DeSantis signed a bill in February making illegal entry a criminal offense, expanding enforcement funding, and allowing the death penalty for illegal immigrants who commit capital crimes. Subsequently, 1,120 immigrants with criminal charges were arrested in Florida.
The problem is that the stagnation of the real estate market in Miami is likely to lead to a local economic downturn. According to the National Association of Realtors, the real estate industry accounts for about a quarter of Florida's economic activity. Southern Florida, where Miami is located, has approximately 11,000 real estate agents active, which is significantly higher than in other major cities like Los Angeles (LA) or New York.
This situation is expected to continue for the time being. The Trump administration has been blocking Federal Housing Administration (FHA) loans to individuals without citizenship or permanent residency. FHA loans are popular among first-time homebuyers due to their availability with low credit scores. Alexander Gandarilla, a consultant in Coral Gables, noted, "The impact of immigration enforcement will grow in the future."
Chen Zhao, head of economic research at Redfin, stated, "From the perspective of foreign investors, the U.S. is currently not a stable investment destination," noting that the Trump administration's policies are changing the status that made the U.S. the most attractive investment destination in the world.