2017 has shaped up to be an interesting year for residential sales in South Florida for several reasons specific and not specific to the region. What do you feel has been the most influential positive or negative factor affecting residential sales and why?
As the absorption rate of residential property has leveled off this year good buying opportunities have emerged. Pricing has peaked and there are wonderful mid-luxury market opportunities that had been previously out of reach. For a long time, many locals felt “locked into” their property, finding it too difficult to compete with foreign cash buyers who were willing to pay over market. Today, lateral, move up, and size down moves can be made more easily. Another positive factor has been the influx of domestic buyers. Foreign investment has leveled off and the local job market is growing. Traditionally, South Florida has relied on two major industries – construction and tourism, but today we are seeing strong job growth in the healthcare, finance and tech sectors. Some of the finest health professionals in the country are being relocated to our local market. And Florida’s favorable tax environment continues to bring buyers from other parts of the country. One negative factor is that pricing in the mid to high luxury market is down. We find that sellers can get hung up on a preservation of equity principle. But when you buy and sell in the same market, it’s also important to consider the gain you can make when you buy. This is especially true when trading up to a larger home.
What is your outlook for single-family and condo sales as we approach 2018? (Feel free to speak to just your farming area)
In the single-family market, there will be more buying opportunities. One trend we continue to see is a stronger sales pace for updated properties– impact windows, crisp and clean modern kitchens and baths. With so many dual-income families and the fast pace of life
here, there is less of a willingness to buy property and improve it. But for those who do so, there can be a good upside.
What have your experiences been working with millennial buyers in terms of their preferences? What’s different about working with a millennial buyer vs. an empty nester?
While EVERY customer is unique, millennials tend to be decisive, analytical, if not utilitarian, in their approach to living spaces. Empty nesters take more time to make decisions and are more emotional, particularly when downsizing. We try to reflect the tone and speed with which our clients want to operate.
Condo amenities now expand far beyond the bellman. What are developers doing differently now to court prospective buyers?
Our sister company, Lowell Homes (currently building in west Broward and soon Palm Beach), is focused on a “valued” luxury approach to the marketplace. Meaning, we work hard to bring an innovative product with expansive spaces and quality materials without the oversell of glitz and amenities. That’s why every spec we’ve sold recently was under contract well before the home was finished.
How real do you think the Chinese market is as it relates to investment in Miami’s condo market?
Kudos to the folks in Miami who are working hard to grow this market. We’ll be ready for them when they arrive.
What international investment market might we see emerge in 2018?
The EB-5 program continues to hang in there. It’s very hard to predict future activities in the international market. Right now, we are seeing Brazil, Columbia and Chile strengthen in buying interest.
In the single-family market ($500,000 – $1 million), do you think pricing will increase, decrease or remain flat in 2018? Why?
Under $1 million is likely to stay flat or rise slightly. There just isn’t enough inventory to put downward pressure on pricing. Homes above $2 million are leveling off. And $1 million to $2 million is hard to peg — with pools and updates, they generally move quickly.
Do you feel that there are still good opportunities for ownership under $350,000 and, if so, where?
Yes, but not in the more central areas of town unless it’s a small condo.
South Florida’s rental market has boomed in the wake of slow condo sales. Do you feel that rents have peaked?
For single family and townhome properties, yes, for now. There isn’t enough inventory for rents to decrease significantly. In dense condo
areas there may be a larger slowdown.
Do you feel that enough affordable housing exists to support the South Florida service communities?
No. This is a big problem.
1537 San Remo Avenue
Coral Gables FL 33146
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