Buying Property
What documents do foreigners need to buy property?
Foreign citizens need the following documents to purchase real estate in Miami:
- A valid passport
- U.S. Taxpayer Identification Number (ITIN)
- Proof of funds source
- Documentation verifying the origin of funds for the purchase
What taxes must be paid when buying property?
When purchasing real estate in Miami, the following taxes and fees apply:
- Documentary Stamp Tax – 0.7% of the property price
- Recording Fee – varies depending on the county
- Annual Property Tax – approximately 2% of the assessed value
What is the home-buying process like?
The standard buying process includes:
- Signing a preliminary purchase agreement
- Paying a deposit (usually 10-20%)
- Conducting due diligence
- Securing financing (if applicable)
- Closing the deal through an escrow agent
Investment and Rentals
What is the average rental yield?
Typical annual returns from long-term rentals:
- Condos: 4-6%
- Single-family homes: 5-8%
- Multi-family complexes: 6-10%
Which areas are the best for investment?
Popular investment areas include:
- Brickell
- Miami Beach
- Sunny Isles Beach
- Aventura
- Coral Gables
Property Maintenance
How much does property maintenance cost?
Monthly expenses typically include:
- HOA fees (building maintenance) – $300-$1,500
- Insurance – $150-$400
- Utilities – $150-$300
- Property tax – depends on property value
Legal Aspects
What types of property ownership exist?
The main types of ownership include:
- Fee Simple (full ownership rights)
- Condominium (shared ownership with HOA)
- Co-op (cooperative ownership structure)
- Leasehold (long-term lease)
Is a real estate agent required for a transaction?
Although not legally required, working with a licensed real estate agent is recommended for:
- Access to updated listings
- Negotiation assistance
- Handling documentation
- Protecting the buyer's interests
Financing
What are the mortgage conditions for foreigners?
Typical mortgage terms for foreign buyers:
- Down payment: 30-40%
- Interest rates: 1-2% higher than for U.S. residents
- Income verification required
- Stricter credit history requirements
Additional FAQs About Miami Real Estate
Viewing and Selecting a Property
How to check a property’s condition before purchasing?
It is recommended to hire a professional inspector to assess:
- Structural integrity
- HVAC and electrical systems
- Hurricane or flood damage
- Roof and window conditions (especially in high-humidity areas)
New construction vs. resale properties: which is better?
- New Construction: Higher price, but lower maintenance costs and modern safety standards
- Resale Homes: More affordable but may require repairs, often located in established neighborhoods
Insurance and Climate Risks
What insurance is mandatory for Miami properties?
- Hurricane and flood insurance (required in coastal zones)
- Homeowners insurance (covers fire, theft)
- Average cost: $2,000–$6,000 per year, depending on risk factors
How to protect a property from hurricanes?
- Install hurricane shutters or impact-resistant windows
- Ensure the structure meets FEMA standards
- Maintain proper drainage systems
Immigration and Visas
Does buying property grant a visa or residency?
- No, but investments over $500,000+ may qualify for the EB-5 visa program (permanent residency via job creation)
- Tourist visa (B1/B2) is suitable for property visits
Property Management
How to manage a property from abroad?
What are the hidden costs of renting out a property?
- Repairs after tenant use
- Rental income tax (federal + 30% for non-residents)
Market Trends
How has the pandemic affected the Miami real estate market?
- Increased demand for private homes and apartments with home offices (+20% price increase since 2020)
- More remote workers and relocations from other states
What are the emerging neighborhoods?
- Edgewater – popular among millennials
- Wynwood – art district with lofts
- Little River – redevelopment zone with commercial projects
Taxes and Reporting
How to declare rental income?
- Non-residents file Form 1040-NR (30% tax)
- Residents pay standard rates (10-37%)
- Deductions available for maintenance, management, and mortgage interest
Is there a tax on selling real estate?
- Yes, Capital Gains Tax (15-20% if held for less than a year)
- Exemptions: $250,000 for individuals, $500,000 for married couples (if owned for at least two years)
Banking Services
How can foreigners open a U.S. bank account?
- Required documents: passport, proof of address, ITIN/SSN
- Popular banks: Bank of America, Chase, Citibank (minimum deposit $500–$1,000 may be required)
Legal Risks
How to avoid fraud when buying property?
- Verify the realtor’s license on the Florida Realtors website
- Use escrow accounts for financial transactions
- Request a Title Search to confirm property ownership history