They have started to build condos in Miami again. For anyone familiar with the Florida real estate market, this statement should be met with some surprise. It was only three years ago that the market in Miami screeched to a halt, with developments left unfinished and projects bottoming out. Now, in 2012, Miami has seen an unprecedented boom. Sales are up 40 percent from last year. And Q3 recently reported that condo prices were up 28%.
What are some of the reasons for this boom? One is population growth. Miami is now one of the fastest growing cities in America. Thousands of foreign immigrants flock to Florida’s sandy beaches each year, mostly from Spanish-speaking countries such as Argentina, Colombia, Mexico and Venezuela, as well as Europeans and even recently Chinese. It has the highest foreign-born population of any major city in the United States. The favorable weather plays a factor, as well as the fact that there are no state income taxes.
Foreign capital has become interested in the investment potential of this boom. Private equity firms from as faraway as Turkey, Brazil and Peru are snapping up luxury real estate in Miami, with hopes that this rebound will keep its momentum.
There is no reason to think otherwise. Miami has shown double-digit growth over the last three years, and it has no signs of slowing down. The Miami Association of Realtors (MAR) has statistics that pending listings for foreign buyers is up by 40 percent, in just the last month.
“There are not a lot of amazing $10 million or $20 million homes out there that don’t need a whole lot of renovations or have land on the waterfront,” says Vanessa Grout, the chief executive of Douglas Elliman Florida. “Brokers are going nuts because their clients are seeking something really special.”
Even bombshell Kim Kardashian has been looking for real estate in Miami. She was spotted a few weeks ago with her sister looking for a little piece of the beachfront dream for herself.
Miami Association of Realtors residential president Patricia Delinois has been quoted as saying “In Miami, we have experienced consistent double digit price appreciation for more than 10 months, which means those who sell now will see considerably higher returns than they would have a year ago, particularly for condominiums.”