After a few previous posts here have noted a couple of reports that may indicate a bit of a cool-down in the South Florida real estate market, a new report seems to point to a market that is surging in the recovery from the downturn of 2007. According to the report, residential development in the local market is booming, especially when it comes to condo construction.
The report indicates that over 35,000 condo units have been proposed for construction in the South Florida area. This number is significant not only because it is so large, but also because it points to a level of development that was last matched in the three or so years just prior to the housing crash.
This substantial investment in the local area by builders and developers may also point to a huge amount of faith that the South Florida residential real estate market is indeed a safe bet again. Any of our readers who are familiar with previous posts here know that single-family homes and other residential property values have continued to rise in the local market over the last few years, so the fact that developers continue to propose new construction may be an indication that they don’t see a slowdown coming up any time soon. And, as a result, South Florida will likely have a larger inventory of condos available than ever before.
The one thing to note, however, is that the report also states that the condo developers in South Florida are depending on buyer deposits more this time around than they did in the years just before the real estate crash. This enables the builders and developers to not be so dependent on financing from lenders.
Source: Miami Herald, “New milestone: 35,000 condo units proposed for South Florida,” Peter Zalewski, Aug. 24, 2014