A number of real estate investors and second-home buyers traveling to South Florida for this year’s long Thanksgiving holiday weekend that symbolically kicks off the start of the busy winter tourism season are sure to develop a case of indigestion that is not related to overeating. The root cause of this anticipated uneasiness is the realization that the South Florida residential real estate market has apparently not only bottomed out but is rapidly strengthening beyond the imagination of locals and out-of-towners alike. Residential resale inventory is tight; prices are rising; rents are spiking; and a new building boom is underway in Miami-Dade, Broward and Palm Beach counties. For the past few years, many of these prospective investors and second-home buyers have made their annual pilgrimages from the Northeast United States, Western Europe and Latin America to the tricounty South Florida region in search of rest, relaxation and real estate. Inevitably, most of these visitors departed South Florida without purchasing deeply discounted properties by rationalizing to themselves that the tricounty region’s residential real estate market had not yet bottomed from the latest crash brought on by the usual: overbuilding, overleveraging and overblown optimism. Some five years ago this month as the U.S. financial system teetered on the edge of collapse, South Florida’s residential resale market was flooded with nearly 108,000 single-family houses, townhouses and condos available for purchase in Miami-Dade, Broward and Palm Beach counties. At the time, Miami-Dade represented the largest share of South Florida’s residential resale inventory available with nearly 41,000 properties on the market. Broward was second with nearly 37,000 residential resale properties available, and Palm Beach was third with nearly 30,000 residences on the market as of Nov. 24, 2008, according to data from the Southeast Florida MLXchange. As federal officials and Congress worked overtime to pass the Troubled Assets Relief Program in an attempt to save the nation’s largest financial institutions from insolvency, nearly 61,000 condominium and townhouse units were available on the resale market in South Florida, according to the data. At the time, only 9,300 residential properties were under contract waiting to transact as buyers headed for the sidelines out of fear of the unknown. Fast-forward to the present: South Florida now has 37,600 residences on the resale market with 14,400 properties available in Miami-Dade, 11,800 residences in Palm Beach and 11,400 properties in Broward as of Nov. 18, 2013, according to the Southeast Florida MLXhange. Condominiums and townhouses still account for the majority of the available resale inventory, but today the total number of units on the market is less than 21,650. This is a decrease in condo and townhouse inventory of nearly 65 percent from 2008, according to the data. Total pending sales in South Florida currently stand at nearly 22,150 properties, representing a nearly 138 percent spike in contracts compared to five years ago. The difficult part for visitors to understand about the South Florida market is that the dramatic changes in residential resale inventory levels have occurred despite continued challenges for buyers in obtaining financing to purchase their primary residences. Full Story1 | 2 | Next » Read more here: miamiherald/2013/11/24/3773505/south-florida-residential-resale.html#storylink=cpy
Posted on: Mon, 25 Nov 2013 13:08:32 +0000
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