Miami Ranks Seventh in Housing Shortage Report As Florida Sees Nations Highest Rent Increase Since 2020

New research has shown that Miami ranks seventh in housing shortage report as Florida has seen the highest rent increase in the nation since 2020. Prices have continued to push higher where rental rates a 2 bedroom rental on Miami Beach is up over 46% year-over-year as of June 2023. Developers have struggled to keep pace despite Miami-developers leading the nation with a record 28,000 units currently under development in the Miami metro-area according to a Costar report.

New research has revealed the top 10 metropolitan areas with the highest ratio of house shortages in accordance with job growth. Miami, FL, is facing a significant challenge in its housing market, as indicated by its job growth-to-building permits ratio of 20.2.

The other US metropolitan areas experiencing housing shortages include San Francisco, Springfield, Urban Honolulu, Syracuse, Boston, New York City, Chicago, New Haven, and Los Angeles.

Real estate site PortlandRealEstate.com analyzed data from the National Association of Realtors, US Census Bureau, and the Bureau of Labor Statistics, examining new job openings per one building permit to determine the housing shortages in metropolitan areas in 2022.

Job Growth-to-Building Permits Ratio: 1. New York City, NY (31.4); 2. San Francisco, CA (29.2); 3. Springfield, MA (26.6); 4. Urban Honolulu, HI (25.1); 5. Syracuse, NY (21.8); 6. Boston, MA (20.4); 7. Miami, FL (20.2); 8. Chicago, IL (19.5); 9. New Haven, CT (19.3); 10. Los Angeles, CA (18.3)

The job growth-to-building permits ratio represents the relationship between new job opportunities created and new building permits issued. Specifically, it indicates the number of new jobs generated for every building permit issued. For example, a ratio of 30 means that, on average, approximately 30 new jobs were created for each new building permit issued. For reference, the average job growth-to-building permits ratio for cities included in the study was 7.64.

Miami, FL, faces a housing shortage as reflected by its job growth-to-building permits ratio of 20.2. The ratio suggests that the job market in the area is experiencing growth, potentially outpacing the construction of new housing units. As a result, the limited housing supply leads to increased housing costs and affordability challenges for residents.

“Miami is seeing rapid job growth as companies and employers move to the city for its pro-business environment and high-quality of life. This has led to a higher housing shortage than most other metro-areas as developers have struggled to keep up, leading to high-prices and rapid rent growth. Units in Downtown Miami and Brickell that would have rented for $2,000 or $3,000 a few years ago are now renting for potentially $5,000+. The residents moving out have not yet found comparable replacements yet more people are moving to the city so developers are pushing to keep pace as pricing pushes higher on average.” Said Demetri Demascus, Co-Founder of PROFILEmiami, Managing Broker of ALTARA Properties and developer of Casa Azzura townhomes in Coconut Grove.

Due to the demand for business to move to the Sunshine State, Florida rent prices are up by 45.77% since 2020, the highest in the nation according to a study by Los Angeles-based luxury real estate experts Los Feliz. Florida and Colorado have seen rent prices increase by over 45% since 2020. With 34.2% of the U.S population renting their home, luxury real estate experts at Los Feliz analyzed the average rental price in each state in March 2020 and again in March 2023 to calculate the percentage increase by comparing average rental price in each state in March 2020 and again in March 2023 to calculate the percentage increase. 34.2% of the U.S population rents their home.

The findings show that Florida’s average rent has increased to $2,127.86 in 2023, an increase of 45.77% over the 2020 price. Florida has low taxes, a thriving job market and fast growing metropolitan cities. Florida is also known for its high percentage of retirees that are drawn to the state due to there being no retirement taxes and sunshine state is also a popular holiday destination which would affect rental prices.

According to Zumper, as of June 2023, the current median rent for a 2-bedroom apartment in Miami is $3,900, a 32% year-over-year change. Taverage rent for a 1-bedroom apartment in Miami, FL is $2,835. This is a 29% increase compared to the previous year. The current median rent for a 2-bedroom apartment in Miami Beach as of June 2023 is $4,500, an 46% year-over-year change. The current average rent for a 1-bedroom apartment in Miami Beach is $2,600, an 18% increase compared to the previous year.

This article contains information from the following sources and studies:

Study conducted by PortlandRealEstate.com, a real estate website that specializes in providing comprehensive information and analysis related to the Portland real estate market.

A study conducted by Los Feliz, a Los Angeles-based luxury real estate brokerage with Ruby Home using Zillow: https://www.rubyhome.com/los-angeles/los-feliz/

Zumper.com

Costar.com

Miami Beach's Exclusive Star Island Now Ranks As The Nation's Priciest Neighborhood

Miami Beach’s exclusive Star Island has emerged as the leader among the most expensive neighborhoods in the United States, leading Port Royal in Naples, FL and Beverly Hill’s Beverly Hills Gateway and Trousdale Estates, according to sales data from Zillow Group Inc. The average home sale on the ritzy island in 2022 traded for $40.2 million, up $16.7 million and 71% from 2019 when the average home sale on the island was $23.5 million.

Over the past several years hedge fund heavyweight Ken Griffin, founder Citadel, has purchased an assemblage of five properties on the island for a combined $170 million. Griffin made a splash when he acquired 8 Star Island Drive, a teardown built in 1993 on 1.8-acres, for $75 million. The sale set record for single-family home sales in Miami-Dade County at the time, a record Griffin is no stranger breaking. Griffin has also acquired the adjacent 10 Star Island for $25 million and 11 and 12 Star Island Drive in an off-market deal for roughly $37 million and 13 Star Island for $32.5 million. He also owned 14 Star Island which he purchased for $24 million in 2020 and sold to ex-New York Yankee and real estate investor Alex Rodriguez for $18.5 million in a reported swap for 13 Star Island.

Griffin hasn’t been the only high-profile investor buying and selling on the Island. Lennar Executive Chairman Stuart Miller kicked off a long list of transactions on the prestigious island when he acquired Thomas Kramer's former 4 and 5 Star Island Drive for $33 million. Stuart Miller developed an ultra-luxury spec home at 22 Star Island with Todd Michael Glaser which was designed by DOMO Design and sold for $49.5 million in an off-market deal overseen by David Solomon and David Miller. Next door, Miller sold a 1.9-acre property at 23 Star Island Drive to the NBA’s Memphis Grizzlies owner Robert Pera for $25 million in 2019. Pera is developing a controversial 28,000 SF waterfront mansion with basketball complex. On the other side of 22 Star Island, Roger and Sloan Barnett acquired the historic Carl Fisher estate at 46 Star Island Drive for $39 million from Marc Iacovelli. Other recent high profile deals on the island include Shay Kostiner selling his vacant lot at 44 Star Island for $10 million in June 2020 and Anthony Hsieh, the founder and CEO of LoanDepot, acquired 34 Star Island Rive for $30 million.

Currently, Alyssa Jansheski of The Inside Network has 27 Star Island listed for lease for $325,000 per month. The Jills Zeder Group has a vacant lot at 36 Star Island spanning 40,000 square feet with 100 feet of waterfront asking $37 million.

The gated Star Island has long been one of the most desirable neighborhoods in Miami, just across the MacArthur Causeway from the entrance to Fisher Island and Miami Beach’s South of Fifth neighborhood. Star Island is a man-made island in the middle of Biscayne Bay and located in the city of Miami Beach. The island was built by the Army Corps of Engineers in 1922 as part of a dredging project and was developed by Carl Fisher into an island for the rich and famous. The island is now home to celebrities and billionaires such as Gloria and Emilio Estefan, Philip Frost, Sean ‘Diddy’ Combs, Alex Rodriguez, Stuart Miller and Vladislav Doronin.

Magic City Tech Boom? Microsoft In Negotiations At 830 Brickell And Elon Musk Wants To Build Tunnels Under Miami

Miami, the magic city, is on track to become the next Silicon Valley as the fallout from the COVID-19 pandemic has brought people flocking to South Florida. Florida saw the second highest population growth over any other state in 2020, following Texas, adding over 240,000 new residents in a single year. The influx of new residents is being driven by those looking to take advantage of remote-working opportunities or seek a state that has let business remain open and has pro-business tax structure. This has led to Miami and Palm Beach real estate pricing and absorption reaching near record highs.

Not only are the new residents flocking from the high-tax New York, at the same time as South Florida’s population boom, the San Francisco Bay Area has seen an exodus of venture capitalists and tech entrepreneurs. Mayor Francis Suarez has opened up the city to tech entrepreneurs and has expressed interest in bringing innovative companies to the magic city and making Miami a global tech hub. Mayor Suarez recently announced he will be appointing a Chief Technology Officer for the city.

Miami’s office market is being a surge in demand and setting record high pricing. Microsoft (NASDAQ: MSFT) is one of the major tech firms looking to move to Miami, the multinational software provider is actively in negotiations to lease 30,000 square feet of space at OKO Group’s 830 Brickell, a 56-story office tower adjacent to Brickell City Centre which is currently under construction. Pricing is still relatively cheap compared to other major markets, asking rates at 830 Brickell are reportedly in the $70’s PSF range. Ken Griffin’s Citadel Securities hedge fund is also reportedly looking at office space in 830 Brickell as is the Chicago-based law firm Baker McKenzie.

The biggest news came when Tesla and SpaceX founder Elon Musk tweeted that he had talked with Florida Governor Ron DeSantis about building a tunnel system underneath Miami to eliminate traffic and pollution. Mayor Suarez tweed that “we will do it,” and invited Musk to visit him at City Hall. In the past Miami has had success building tunnels at a comparatively low cost. The initiative would be led by Elon Musk’s Boring Company, who is getting ready to reveal the Vegas Loop to the public, a 4,475’ tunnel loop under the Las Vegas Convention Center. In the Las Vegas Loop passengers will reach speeds up to 155 mph and will ride in Tesla Model X’s, Model 3’s, and a 16-passenger modified Model 3. Las Vegas in now working with the Boring Company to build a citywide network of tunnels.

For more information about 830 Brickell, Brickell office space, private showings or purchasing/ leasing information please fill out the form below:

Douglas Elliman Releases Q3 2020 Florida Regions Market Reports For South Florida

Douglas Elliman has just released their Q3 2020 Market Reports for Florida regions, which were prepared in conjunction with Jonathan Miller of Miller Samuel INC. The reports revealed that sales rose sharply higher year over year, rebounding quickly from the restraint of spring market activity at the onset of the COVID-19 crisis. Palm Beach has been one of the hottest markets in the United States as flight capital continues to pour in from the high-tax states such as New York and Connecticut. All three condo price trend indicators increased year over year for the fifth straight quarter in Palm Beach while single family sales nearly tripled from the year-ago quarter as listing inventory fell sharply. Coral Gables and Miami Beach also surged as sales and prices saw 5 year highs across much of South Florida.

BOCA RATON/HIGHLAND BEACH

Overview:

• In a rebound from the prior quarter, condo and single family sales saw their largest annual rise in seven years

• All single family price trend indicators rose year over year as sales saw its largest jump in nearly nine years

• All luxury condo price trend indicators showed a substantial year over year increase

Key Trend Metrics (Year to Year)

Luxury Condo:

• Median sales price rose 28.6% to $868,000

• Average price per square foot increased by 12.2% to $414

• Number of sales rose 14.3% to 88

• Listing inventory declined by 1.5% to 405 units

Luxury Single Family:

• Median sales price rose 14.3% to $2,550,000

• Average price per square foot increased by 4.5% to $421

• Number of sales rose 25.4% to 89

• Listing inventory declined by 22% to 266 units

MIAMI BEACH/BARRIER ISLANDS

Overview:

• Condo price trend indicators increased as sales and listing inventory edged higher

• Overall single family price trend indicators set new records as sales surged year over year

• Luxury condo price trend indicators jumped year over year, aided by a shift to larger sized sales

Key Trend Metrics (Year to Year)

Luxury Condo:

• Median sales price rose 29.3% to $2,975,000

• Average price per square foot increased by 18.9% to $1,262

• Number of sales remained flat at 77

• Listing inventory declined by 15.1% to 993 units

Luxury Single Family:

• Median sales price rose 13.9% to $14,806,950

• Average price per square foot increased by 12% to $1,787

• Number of sales rose 63.6% to 18

• Listing inventory declined by 27.1% to 102 units

MIAMI COASTAL MAINLAND

Overview:

• Condo price trend indicators and sales moved higher as listing inventory slipped to a three-year low

• Single family price trend indicators set new records as sales rose to their highest level in more than five years

• Luxury condo price trend indicators increased year over year as listing inventory declined annually for the second time in three quarters 

Key Trend Metrics (Year to Year)

Luxury Condo:

• Median sales price rose 9.9% to $852,500

• Average price per square foot increased by 6.9% to $508

• Number of sales rose 1% to 200

• Listing inventory declined by 15.1% to 2,398 units

Luxury Single Family:

• Median sales price rose 31.1% to $1,940,000

• Average price per square foot increased by 29.3% to $600

• Number of sales rose 9.5% to 230

• Listing inventory declined by 32.1% to 694 units

CORAL GABLES

Overview:

• Single family sales surged and listing inventory fell from the prior year quarter as the lockdown ended

• Condo listing inventory declined annually for the fifth consecutive quarter

• Luxury single family listing inventory declined sharply year over year for five straight quarters

Key Trend Metrics (Year to Year)

Luxury Condo:

• Median sales price fell 41.4% to $962,500

• Average price per square foot decreased by 28.7% to $407

• Number of sales slipped 11.1% to 8

• Listing inventory inclined by 125% to 72 units

Luxury Single Family:

• Median sales price rose 26.9% to $4,500,000

• Average price per square foot decreased by 6.4% to $989

• Number of sales rose 53.3% to 23

• Listing inventory declined by 21.1% to 101

DELRAY BEACH

Overview:

•  Single family sales increased at their highest year over year rate in five years

• Condo sales reached their highest third-quarter total in twenty-two years of tracking

• Both single family and condo luxury listing inventory fell sharply from the prior year total

Key Trend Metrics (Year to Year)

Luxury Condo:

• Median sales price rose 41.1% to $604,500

• Average price per square foot increased by 21.4% to $409

• Number of sales rose 14.3% to 72

• Listing inventory declined by 25.2% to 169 units

Luxury Single Family:

• Median sales price rose 40.8% to $2,500,000

• Average price per square foot increased by 5.7% to $515

• Number of sales rose 22.9% to 43

• Listing inventory declined by 45.6% to 99 units

FORT LAUDERDALE

Overview:

•  All condo price trend indicators rose year over year as the number of sales jumped 

• Single family sales surged, and listing inventory fell sharply from the prior-year quarter

• Single family median sales price increased annually for the eighth consecutive quarter

Key Trend Metrics (Year to Year)

Luxury Condo:

• Median sales price rose 0.9% to $1,155,000

• Average price per square foot increased by 1.4% to $509

• Number of sales rose 7.8% to 55

• Listing inventory declined by 0.5% to 379 units

Luxury Single Family:

• Median sales price rose 7.7% to $2,275,000

• Average price per square foot remained flat at $580

• Number of sales rose 17.6% to 60

• Listing inventory declined by 21.5% to 256 units

JUPITER/PALM BEACH GARDENS

Jupiter Overview:

•  Single family sales jumped year over year as listing inventory dropped sharply

• The most third-quarter condo sales in fifteen years

Palm Beach Gardens Overview:

• The most third quarter single family sales in fifteen years

• Condo listing inventory declined annually for the sixth straight quarter

Key Trend Metrics (Year to Year)

Luxury Condo:

• Median sales price fell 7.1% to $657,500

• Average price per square foot decreased by 16.4% to $320

• Number of sales rose 27.3% to 28

• Listing inventory inclined by 26.3% to 72 units

Luxury Single Family:

• Median sales price rose 121% to $3,550,000

• Average price per square foot increased by 37% to $678

• Number of sales rose 14.7% to 39

• Listing inventory declined by 38.7% to 76 units

PALM BEACH

Overview:

• All three condo price trend indicators increased year over year for the fifth straight quarter

• Single family sales nearly tripled from the year-ago quarter as listing inventory fell sharply

• Luxury listing inventory fell significantly year over year for the third consecutive quarter 

Key Trend Metrics (Year to Year)

Luxury Condo + Single Family:

• Median sales price declined 39.3% to $10,000,000

• Average price per square foot increased by 20% to $1,906

• Number of sales rose 87.5% to 15

• Listing inventory declined by 65.3% to 26 units

WELLINGTON

Overview:

• Condo sales surged annually at their highest rate in eleven years as listing inventory edged higher for the second straight quarter

• Single family median sales price rose annually for the twelfth straight quarter as listing inventory dropped sharply

• Luxury condo median sales price more than doubled year over year as listing inventory saw a significant annual decline  

Key Trend Metrics (Year to Year)

Luxury Condo:

• Median sales price rose 102.4% to $840,000

• Average price per square foot increased by 61.1% to $427

• Number of sales rose 28.6% to 9

• Listing inventory declined by 42.1% to 22 units

Luxury Single Family:

• Median sales price rose 28.1% to $1.825,000

• Average price per square foot increased by 13.1% to $553

• Number of sales rose 20.7% to 35

• Listing inventory declined by 9.3% to 194 units

WEST PALM BEACH

Overview:

• Condo median sales price has risen each quarter on a year over year for more than nine years

• Single family listing inventory has fallen at a rising year over year rate for five consecutive quarters

• Luxury condo listing inventory has posted large annual gains for three of the past four quarters

Key Trend Metrics (Year to Year)

Luxury Condo:

• Median sales price declined 49.1% to $407,500

• Average price per square foot decreased by 62% to $452

• Number of sales rose 7.5% to 72

• Listing inventory inclined by 85.5% to 308 units

Luxury Single Family:

• Median sales price rose 48.7% to $1,297,250

• Average price per square foot increased by 32.1% to $412

• Number of sales rose 28% to 64

• Listing inventory declined by 14.3% to 132 units

Douglas Elliman Releases Q2 2020 South Florida Market Reports

Douglas Elliman has just released their Q2 2020 Market Reports for South Florida, which were prepared by Miller Samuel, a leading independent appraisal firm. The reports, which cover the areas such as Boca Raton, Delray Beach, Fort Lauderdale, Miami Beach, and the Miami Coastal Mainland, have revealed that the COVID-19 market shutdown during much of the second quarter caused sales to fall sharply in South Florida, despite the strength of the market in the first quarter.

Miami Beach/Barrier Islands

Overview:

• Condo price trend indicators moved higher as the number of sales dropped during the shutdown

• Single-family price trend indicators continued to decline along with sales and listing inventory year over year

• Luxury condo price trend indicators pressed higher as listing inventory showed a slight gain

Key Trend Metrics (Year to Year)

Overall:

• Median sales price rose 10.3% to $480,000

• Average price per square foot edged up 6.1% to $659

• Number of sales dropped 34.9% to 501 

• Listing inventory decreased by 0.5% to 6,393 units

Luxury Condo:

• Median sales price increased by 11.6% to $2,850,000

• Average price per square foot rose 4.8% to $1,231

• Number of sales fell 37.7% to 43

• Listing inventory slipped 3.0% to 1,095 units

Luxury Single Family: 

• Median sales price decreased by 22.6% to $7,200,000

• Average price per square foot jumped 17.2% to $1,388

• Number of sales had no change at 9 

• Listing inventory increased by 25.4% to 173 units

Miami Coastal Mainland

Overview:

• Condo listing inventory and number of sales declined, median sales price reached a new record

• Single-family median sales price rose to a new record as both sales and listing inventory fell sharply

• Luxury condo price trend indicators showed mixed results as the number of sales saw a significant decline 

Key Trend Metrics (Year to Year)

Overall:

• Median sales price rose 4.4% to $355,000

• Average price per square foot increased by 5.1% to $289

• Number of sales dropped 20.1% to 2,672

• Listing inventory declined by 7.8% to 9,699 units 

Luxury Condo:

• Median sales price fell 14.0% to $805,000

• Average price per square foot dropped 0.6% to $489

• Number of sales declined by 33.5% to 115

• Listing inventory increased by 13.4% to 2,508 units

Luxury Single Family:

• Median sales price fell 11.9% to $1,410,000

• Average price per square foot rose 25.5% to $557

• Number of sales decreased by 6.1% to 153

• Listing inventory dropped 1.1% to 915 units

Fort Lauderdale

Overview:

• Condo sales dropped at the highest rate in more than thirteen years as all price trend indicators rose annually

• Single-family sales fell at the largest rate since 2007 as median sales price stabilized

• Luxury condo price trend indicators increased above year-ago levels at their most robust rate in six quarters

Key Trend Metrics (Year to Year)

Luxury Condo:

• Median sales price rose 6.0% to $1,282,330

• Average price per square foot increased by 5.2% to $587

• Number of sales slipped 27.5% to 37

• Listing inventory declined by 16.5% to 283 units

Luxury Single Family:

• Median sales price dropped 22.5% to $2,500,000

• Average price per square foot decreased by 23.9% to $596

• Number of sales fell 20.5% to 35 

• Listing inventory declined by 12.5% to 259 units

Boca Raton/Highland Beach

Overall:

• Condo sales declined year over year at its highest rate in 13 years as median sales price increased

• Single-family sales declined year over year at its highest rate in 13 years as median sales price surged

• Luxury condo median sales price declined while luxury single-family median sales price rose

Key Trend Metrics (Year to Year)

Luxury Condo:

• Median sales price fell 23.0% to $885,000

• Average price per square foot slipped 13.0% to $461

• Number of sales declined by 21.2% to 52

• Listing inventory surged 11.2% to 328 

Luxury Single Family:

• Median sales price dropped 13.1% to $2,215,000

• Average price per square foot decreased by 12.6% to $382 

• Number of sales slipped 12.1% to 51

• Listing inventory declined by 0.3% to 304 units

Delray Beach 

Overview:

• Single-family sales declined at the largest year over year rate in over thirteen years as the market paused

• Condo median sales price was unchanged year over year, the eighteenth straight quarter without a decline

• Luxury single-family listing inventory declined annually as luxury condo listing inventory saw a large gain

Key Trend Metrics (Year to Year)

Luxury Condo:

• Median sales price decreased by 6.7% to $810,500

• Average price per square foot rose 6.7% to $445

• Number of sales slipped 24.6% to 46

• Listing inventory surged 20.9% to 208 units

Luxury Single Family: 

• Median sales price dropped 0.6% to $2,087,500

• Average price per square foot fell 13.7% to $504

• Number of sales declined by 15.2% to 28

• Listing inventory increased by 5.7% to 130

Wellington

Overview:

• Condo sales declined sharply as median sales price increased year over year for the fifteenth straight quarter

• Single-family listing inventory and sales showed sharp declines from prior year levels

• Luxury listing inventory across both property types jumped from prior year

Key Trend Metrics (Year to Year)

Luxury Condo: 

• Median sales price fell 19.9% to $585,000

• Average price per square foot dropped 10.1% to $313

• Number of sales increased by 16.7% to 7

• Listing inventory rose 72.2% to 62 units

Luxury Single Family:

• Median sales price declined 24.3% to $1,135,000

• Average price per square foot slipped 34.9% to $426

• Number of sales jumped 15.0% to 23

• Listing inventory increased by 9.2% to 226 units

Palm Beach

Overview:

• Condo price trend indicators jumped as the largest average sales size in two years skewed them higher

• Single-family listing inventory fell by the largest rate in seven years of tracking

• Luxury listing inventory showed a substantial drop as price trend indicators surged year over year 

Key Trend Metrics (Year to Year)

Luxury Condo and Single Family:

• Median sales price surged 33.1% to $14,000,000

• Average price per square foot rose 18.4% to $2,180

• Number of sales dropped 30.8% to 9

• Listing inventory declined by 65.6% to 22 units 

Jupiter/Palm Beach Gardens

Jupiter Overview:

• Single-family sales price trend indicators and sales continued to show substantial year over year growth

• Condo price trend indicators rose year over year for the fourth straight quarter

Palm Beach Gardens Overview:

• Single-family sales fell at their most significant rate in fourteen years

• Condo price trend indicators rose year over year for the third consecutive quarter

Key Trend Metrics (Year to Year)

Jupiter Luxury Condo:

• Median sales price decreased by 19.9% to $733,000

• Average price per square foot dropped 10.6% to $404

• Number of sales fell 13.6% to 19

• Listing inventory increased by 16.7% to 63 units

Jupiter Luxury Single Family:

• Median sales price declined by 11.5% to $2,300,000

• Average price per square foot decreased by 2.9% to $647

• Number of sales fell 7.4% to 25

• Listing inventory dropped 15.3% to 111 units

Palm Beach Gardens Luxury Condo:

• Median sales price fell 26.7% to $440,000

• Average price per square foot dropped 24.1% to $239

• Number of sales declined by 19.0% to 17

• Listing inventory surged 67.4% to 72 units

Palm Beach Gardens Luxury Single Family:

• Median sales price jumped 21.2% to $2,347,500

• Average price per square foot rose 8.7% to $501

• Number of sales decreased by 23.1% to 20

• Listing inventory dropped 27.5% to 95 units

By Isabella Zimmermann 

Douglas Elliman Releases June 2020 New Signed Contracts Report for Florida

Douglas Elliman in conjunction with Miller Samuel, a leading independent appraisal firm, has released its second monthly recurring report for June 2020. The report focuses on the new contracts signed and new listings that entered the rapidly changing market in Douglas Elliman’s Florida regions of Miami-Dade, Broward, Palm Beach, Pinellas, and Hillsborough. Overall, there was a surge in new signed contracts far exceeding year-ago levels, with excess demand coming from the Northeast. However, new inventory level gains have not kept pace with the growth in new contracts.

New contracts and new listings for each property type have been broken out by eight price tranches depending on regional pricing, on a year to year basis. Douglas Elliman will release a similar report to this one once again during the first week of August to disclose data regarding the number of new contracts signed and new listings during the month of July.

Palm Beach County

Key Trend Metrics (Year to Year)

Single Family:

• Number of new signed contracts soared 71.3% to 4,261 contracts

• Listing inventory dropped 19.9% to 1,604 units

• 642 single family homes priced above $1M went into contract, a 114.7% increase from last year

Condo:

• Number of new signed contracts jumped 76.0% to 2,626 contracts

• Listing inventory surged 4.2% to 1,175 units

• Condos priced between $200K and $299K saw a 107.6% incline in the number of signed contracts for a total of 467 

Broward County

Key Trend Metrics (Year to Year)

Single Family:

• Number of new signed contracts rose 76.1% to 4,336 contracts

• Listing inventory decreased by 27.0% to 1,622 units

• There was a 123.2% increase in the number of signed contracts for homes priced between $600K and $799K 

Condo:

• Number of new signed contracts surged 61.4% to 3,154 contracts

• Listing inventory fell 14.2% to 1,403 units

• 78 condos priced between $500K and $599K went into contract, a 116.7% jump from last year

Miami-Dade County

Key Trend Metrics (Year to Year)

Single Family:

• Number of new signed contracts edged up 74.3% to 3,955 contracts

• Listing inventory dropped 25.0% to 1,426 units

• There were 172 homes priced between $800K and $99K that went into contract, a 123.4% increase from last year for similarly priced homes

Condo:

• Number of new signed contracts climbed 54.6% to 4,093 contracts

• Listing inventory slipped 4.0% to 1,918 units

• 643 condos priced between $200K and $299K went into contract compared to last year’s 344

Pinellas County

Key Trend Metrics (Year to Year)

Single Family:

• Number of new signed contracts surged 95.9% to 2,897 contracts

•  Listing inventory decreased by 26.9% to 1,031 units

• There was a 148.8% rise in homes priced between $500K and $599K that went into contract

Condo:

• Number of new signed contracts increased by 93.4% to 1,408 contracts

• Listing inventory fell 12.0% to 512 units

• 28 condos priced between $800K and $999K went into contract, a 250.0% surge from last year’s 8

Hillsborough County

Key Trend Metrics (Year to Year)

Single Family: 

• Number of new signed contracts rose 98.2% to 4,524 contracts

• Listing inventory declined 32.1% to 1,550 units

• There was a 223.9% jump in the number of new signed contracts for homes priced at or above $1M

Condo:

• Number of new signed contracts grew 124.0% to 616 contracts

• Listing inventory declined 18.9% to 223 units

• Condos priced at or above $1M saw a drastic increase of 1633.3% in the number of new signed contracts for a total of 52

by Isabella Zimmermann

Douglas Elliman Releases May 2020 New Signed Contracts Report for Florida

Douglas Elliman in conjunction with Miller Samuel, a leading independent appraisal firm, has just released its May 2020 New Signed Contracts Report, which reveals that the number of newly signed contracts across property types in Florida was at a high last month, despite there being lower levels of new listing inventory coming online. The Florida report includes the five counties of Miami-Dade, Broward, Palm Beach, Pinellas, and Hillsborough, focusing on the new contracts signed and new listings that entered the Florida Market during the entire month. The regions are broken up by two property types: single family and condo, as well as county, borough, or area. New contracts and new listings for each property type have been broken out by eight price tranches depending on regional pricing, on a year to year basis. Douglas Elliman will be producing a monthly recurring report similar to this one during the first week of each month to cover the prior month’s number of new contracts signed and new listings to provide a data-driven picture of the rapidly changing market.

Palm Beach County

Overview:

• Despite lower levels of new listing inventory coming online, the number of new signed contracts across property types pressed higher

Key Trend Metrics (Year to Year)

Single Family:

• Number of new signed contracts for homes jumped 27.7% to 3,444 contracts 

• Listing inventory dropped 37.9% to 1,381 units

• There was a 49.3% decline in the number of new listings for homes priced below $200K

Condo: 

• Number of new signed contracts for condos increased by 16.6% to 2,033 contracts

• Listing inventory declined 28.7% to 906 units

• 111 condos priced above $1M went into contract, a 40.5% increase from the number of condos that went into contract in May 2019

Broward County

Overview: 

• There was a larger rise in overall single family new signed contracts than for overall condo new signed contracts

Key Trend Metrics (Year to Year)

Single Family:

• Number of new signed contracts rose 33.4% to 3,499 contracts

• Listing inventory slipped 42.3% to 1,389 units

• Listing inventory dropped by 66.4% for homes priced below $200K to 48 units

Condo:

• Number of new signed contracts increased by 19.2% to 2,491 contracts

• Listing inventory dropped 35.1% to 1,108 units 

• 89 condos priced at or above $1M went into contract, a 50.8% increase from last year  

Miami-Dade County

Overview:

• Despite the significant drop in single family and condo new listings during the spring, a noticeable uptick began in May

Key Trend Metrics (Year to Year)

Single Family:

• Number of new signed contracts rose 36.2% to 3,284 contracts

• Listing inventory declined 40.7% to 1,232 units

• Listing inventory for homes priced below $200K saw a 60.6% decline

Condo:

• Number of new signed contracts edged up 4.1% to 3,058 contracts

• Listing inventory dropped 42.6% to 1,386 units

• There were 91 new listings for condos priced between $600K to $799K, a 52.4% drop from last year’s 191 new listings for similarly priced condos  

Pinellas County

Overview:

• Along with the atypical drop in new listings introduced to the market this spring, new contract signings surged for both single families and condos

Key Trend Metrics (Year to Year)

Single Family:

• Number of new signed contracts surged 45.3% to 2,519 contracts

• Listing inventory decreased by 33.4% to 974 units

• Homes priced at or above $1M saw a 100.0% surge in the number of new signed contracts for a total of 132

Condo:

• Number of new signed contracts rose 32.3% to 1,143 contracts

• Listing inventory fell 34.9% to 443 units

• 25 condos priced between $800K to $999K went into contract, a 108.3% increase from last year

Hillsborough County

Overview:

• There was a significant surge in new signed contracts for both single family and condo properties as listing inventory remained slow to enter the spring market

Key Metrics (Year to Year)

Single Family:

• Number of new signed contracts increased by 66.6% to 4,266 contracts

• Listing inventory slipped 37.5% to 1,594 units 

• 200 homes priced between $600K to $799K went into contract, a jump of 124.7% from last year 

Condo: 

• Number of new signed contracts rose 53.2% to 521 contracts

• Listing inventory fell 25.0% to 216 units

• There was a 425.0% rise in homes priced at or above $1M that went into contract

By Isabella Zimmermann

Why Rent Strikes Are Bad for Everyone and What’s Going to be Done about Unemployment?

Since thousands of businesses were deemed non-essential and forced to shut their doors, reemployment assistance claims over the last six weeks have surpassed two million in South Florida. With a tourism-dependent economy plus an older population, Florida is more vulnerable to economic shock, which is why it is one of the top five states with the highest number of claims. The longer the standstill goes on, the worse the economic fallout will be. 

As May rents come due and unemployment rates continue to jump, providing assistance to households should be a top priority for policymakers. The prospect of a rent strike has been trending in the news and on social media, but a voluntary movement to skip rent payments could destabilize not only the housing market, but the American economy as well. How many months of working capital do small businesses have to stay afloat, in order for those furloughed and laid off employees to have jobs to return to after nationwide and state stay-at-home orders are eased and how will South Florida’s real estate market fare in the coming months? 

May Day: May 1st Is Here

Multifamily landlords were pleasantly surprised with April collections. In an exclusive webinar interview hosted by PROFILE last week, President of Tate Capital, James Tate, who has over $1B assets under management, told us “We’re 90% collected,” talking about his 10,000+ door multifamily portfolio. Now it’s May 1st and everyone is wondering what May rent collections will be. “May 1st will be a good deciding point to see how many people default,” added Allen Morris, Chairman and CEO of the Allen Morris Companies.  

Morris said his April multifamily rent collections were at 95%. He’s opening two new apartment buildings in Orlando this summer and is taking a proactive leasing approach. “People are signing leases, assuming the University of Central Florida is holding its fall semester. We’re giving tenants a guarantee in their lease. If they delay opening the university, we will delay rent until school opens.” Offering tenants flexibility gives them the security to sign leases now and is helping to forge a positive landlord-tenant relationship that will be dependent on open communication, should issues with payment arise in the future. 

Trending: Socialist Whispers

With talks of rent strikes sweeping the country, landlords have been portrayed as vultures preying on the pockets of financially insecure tenants, when they remain responsible for property taxes and other carrying costs that help pay for public improvements, education and other municipality benefits. Diligent landlords are communicating with their tenants and weeding out those who are taking advantage of the public health crisis, says Shahab Karmely, CEO of KAR Properties. Those who can, should pay rent to support the services their communities need. Those directing their frustrations toward landlords may have valid concerns: with the economy shut down by government-mandated order, how are people supposed to pay bills and keep businesses running?  

In New York, politicians pushing socialist rhetoric and big government reach such as Alexandria Ocasio Cortez have called for rent strikes and rent cancellations. Movements in New York City even claim to have “identified” landlords who can take a “shave”. Lack of payment means that owners will not be able to stay in business and manage the building to the tenant’s expectations, including paying for things like common area maintenance (think: how much does it cost for a cleaning crew to wipe down all public surfaces in a building multiple times a day). Landlords also pay property tax, insurance, debt service, management fees and capital expenditures for improvements. 

Most commercial real estate investments are made by an owner contributing an equity portion to a project, but a majority of the total costs are funded through debt that is usually collateralized by the asset (if it’s senior debt). Typical sources of debt include pension and life insurance funds, which could be the life savings of either a tenant or a landlord. When landlords are unable to meet their debt obligations, the cascading effects don’t stop at their coffers, but trickle down to all Americans. Not making rent payments could derail future opportunities for many, including someone’s retirement age. 

Karmely added “The real pandemic to hit New York City multifamily was the legislature that strangled the landlords in this business,” which will continue to make Florida’s real estate investment climate more attractive. Multifamily product in New York City has been trading between 3-5% cap rate, depending on the neighborhood. The low trading cap rates for core product has made some investors nervous about paying such a premium for an asset that the New York government has so much control over. 

Another risk for New York investors is that South Florida’s pricing for comparative rental and condo inventory is cheaper than it’s NYC counterpart, while providing higher quality-of-life with more space and building amenities. From an investment perspective, it is also easier to manage assets in Florida where there is no government-enforced rent control, rent stabilization, or near-impossible eviction procedures for delinquent tenants.

Opportunities on the Horizon

The cure to the virus is causing an economic calamity that is hitting everybody and everything, which means opportunities will be on the horizon three to four months from now when property owners' cash reserves run dry, especially for retail and restaurant real estate assets. 

Many have posited, is the cure worse than the virus? How long can residential and commercial tenants pay their rent amid an economic shutdown? Will we be able to produce our way out of a recession with unemployment in the double digits? Likely not - Uncle Sam will be waiting in the shadows with hand outstretched to collect his dues. As we all sit on the sidelines, awaiting our fates, the solution appears to be a function of time. 

“My biggest concern is that we were hit with an 11 magnitude earthquake, and we all got knocked down. Unfortunately, after a major earthquake in coastal areas there is a tsunami. My concern is how are these small businesses supposed to remain open and sustain themselves for the next six to eight months unless something material is done by the federal government? Who’s going to hire those 30 million unemployed people back? If you ask me why I can’t sleep at night, that’s what I’m really concerned about,” opined Tate to cheers of “Jimmy Tate for President!” 

-- Special reporting by the PROFILEmiami Team. Isabella Zimmermann, Katya Demina and Demetri Demascus contributed to this article.

Douglas Elliman Releases Q1 2020 South Florida Market Reports

Douglas Elliman in conjunction with Miller Samuel, a leading independent appraisal firm, has just released their Q1 2020 Market Reports for South Florida. It reveals noticeably stronger results for listing inventory growth in the first two and a half months of the quarter until market awareness of COVID-19 occurred in mid-March, which slowed growth across South Florida in areas such as Boca Raton, Delray Beach, Fort Lauderdale, Miami Beach, and the Miami Coastal Mainland. The report reflects pre-pandemic strengths in the South Florida market and even an increase in some areas’ average sales price and number of sales compared to the previous quarter, especially in Palm Beach, which saw a 46.7% rise in number of closed condo sales and had the most significant year over year increase in single-family sales in six years.

“The same fundamentals that have made Florida attractive, and have supported the relatively long-term stability in our markets over the past few years, all remained in place during the first quarter as much as they will once we get past this pandemic. Overall Q1 reflected the pre-pandemic strengths we have been enjoying, with most markets realizing steady sales volume and pricing. As we come out of this global crisis, I believe that the desirability for Florida’s lifestyle coupled with tax reform, and the maturation of our markets, will continue to support the trajectory the markets were on prior to COVID-19,” said Jay Phillip Parker, CEO of Douglas Elliman Florida brokerage.

Miami Beach/Barrier Islands

Overview:

·      Overall listing inventory declined year over year for condos and single-family properties

·      Condo price trend indicators declined from the year-ago quarter

·      Single-family price trend indicators declined annually, partially skewed by the decline in average sales size

·      A sharp drop in average sales size for both luxury condos and luxury single-family properties skewed price trend indicators lower

Key Trend Metrics (Year to Year)

Overall:

·      Median sales price slipped 1.1% to $435,000

·      Average price per square foot decreased by 12.4% to $621

·      Number of sales slipped by 0.4% to 769

·      Listing inventory decreased by 4.5% to 6,425 

Luxury Condo:

·      Median sales price fell 20.8% to $2,553,000

·      Average price per square foot decreased by 9.5% to $1,175

·      Listing inventory rose 12.2% to 1,129 units

·      Average square footage declined 13.8% to 3,429

Luxury Single Family:

·      Median sales price fell 32.9% to $9,766,667

·      Average price per square foot decreased by 22.3% to $1,184

·      Listing inventory dropped 19.1% to 169 units

·      Average square footage declined 13.6% to 8,249

Miami Coastal Mainland

Overview: 

·      Overall listing inventory declined sharply on a year over year basis for both condos and single-family properties

·      Condo sales rose annually for the fourth straight quarter as price trend indicators pressed higher

·      Single-family price trend indicators rose annually, and sales extended its year over year growth streak to the fourth straight quarter

·      A significant decline in listing inventory on a year over year basis for both luxury condos and luxury single-family properties

Key Trend Metrics (Year to Year)

Overall: 

·      Median sales price rose 9% to $340,000

·      Average sales price increased by 7.6% to $458,287

·      Number of sales rose 7.7% to 3,343

·      Listing inventory fell 14.1% to 10,519 units

Luxury Condo

·      Median sales price increased by 20% to $1,195,545

·      Average price per square foot rose 5.1% to $492

·      Listing inventory declined 19.8% to 2,212 units

·      Average square footage increased by 12.9% to 2,430

Luxury Single Family

·      Median sales price rose 13.7% to $1,600,000

·      Average price per square foot edged up 1.1% to $444

·      Listing inventory fell 24.4% to 925 units

·      Average square footage slipped 3.3% to 4,037

Fort Lauderdale

Overview:

·      Condo price trend indicators pressed higher as sales slipped year over year

·      Single-family sales and price trend indicators posted large annual gains

·      Luxury condo price trend indicators showed mixed year over year results

·      Luxury single-family price trend indicators surged, skewed by large increase in average sales size

Key Trend Metrics (Year to Year)

Luxury Condo:

·      Median sales price slipped 1.3% to $1,210,000

·      Average price per square foot edged up 1.3% to $558

·      Listing inventory decreased by 2.6% to 339 units

·      Average square footage declined 3.6% to 2,604

Luxury Single Family:

·      Median sales price jumped 44% to $3,225,000

·      Average price per square foot rose 47.7% to $783

·      Listing inventory fell 25.3% to 296 units

·      Average square footage rose 17% to 5,778

Boca Raton/Highland Beach 

Overall:

·      Condo listing inventory fell year over year for sixth straight quarters with the most significant decline in the current quarter

·      Single-family listing inventory declined annually over the past four quarters at a rising rate

·      Luxury condo and luxury single-family inventory fell short of year-ago levels

Key Trend Metrics (Year to Year)

Luxury Condo: 

·      Median sales price slipped 0.3% to $900,000 

·      Average price per square foot decreased by 0.2% to $465

·      Listing inventory fell 15.6% to 260 units

·      Average square footage declined by 4.8% to 2,666

Luxury Single Family

·      Median sales price fell 10.3% to $1,895,000

·      Average price per square foot rose 1.2% to $407

·      Listing inventory fell 16.9% to 339 units

·      Average square footage declined 0.4% to 7,267

Delray Beach

Overview:

·      Single-family median sales price hasn’t shown a year over year decline in four quarters 

·      Condo listings fell annually for four straight quarters 

·      Luxury single-family price trend indicators showed mixed results

·      Luxury condo price trend indicators showed substantial annual gains, partially aided by the increase in sales size 

Key Trend Metrics (Year to Year)

Luxury Condo:

·      Median sales price jumped 40.3% to $754,000

·      Average price per square foot rose 48.9% to $530

·      Listing inventory fell 36.3% to 163 units

·      Average square footage increased by 2.4% to 1,827

Luxury Single Family:

·      Median sales price fell 19.6% to $1,400,000

·      Average price per square foot rose 5.5% to $439

·      Listing inventory declined 7.1% to 91 units

·      Average square footage declined 1.8% to 4,781

Wellington 

Overview:

·      Condo price trend indicators and sales rose as listing inventory declined from the prior year

·      Single-family sales and price trend indicators moved higher year over year as listing inventory dropped sharply

·      Luxury price trend indicators for both property types showed mixed results

Key Trend Metrics (Year to Year)

Luxury Condo:

·      Median sales price rose 22% to $730,000

·      Average price per square foot decreased by 3.3% to $348

·      Listing inventory increased by 9.1% to 36 units

·      Average square footage declined 10.9% to 2,038

Luxury Single Family: 

·      Median sales price fell 45.5% to $1,500,000

·      Average price per square foot rose 18.1% to $654

·      Listing inventory declined 12.3% to 207 units

·      Average square footage declined 21.9% to 4,465

Palm Beach

Overview: 

·      Listing inventory for condos, single-family properties and luxury fell sharply from year-ago levels

·      All three condo price trend indicators rose year over year for the third straight quarter

·      The most significant year over year increase in single-family sales in six years

·      All three price trend indicators for the luxury market were skewed higher year over year by the surge in average sales size

Key Trend Metrics (Year to Year)

Luxury Condo and Single Family: 

·      Median sales price surged 48.1% to $10,517,500

·      Average price per square foot rose 12.2% to $1,841

·      Listing inventory dropped 49.6% to 64 units

·      Average square footage surged 49.4% to 7,344

Jupiter/Palm Beach Gardens

Jupiter Overview:

·      Single-family sales price trend indicators and sales showed substantial annual gains

·      Condo sales declined as price trend indicators press higher from year-ago levels

Palm Beach Gardens Overview:

·      Single-family sales price trend indicators were mixed as sales jumped year over year

·      Condo sales and price trend indicators showed robust annual increases

Key Trend Metrics (Year to Year)

Jupiter Luxury Condo:

·      Median sales price slipped 5.4% to $915,000

·      Average price per square foot rose 2.7% to $452

·      Listing inventory rose 17.4% to 54 units

·      Average square footage edged up 0.3% to 2,378

Jupiter Luxury Single Family:

·      Median sales price rose 8.5% to $2,600,000

·      Average price per square foot increased by 9.2% to $666

·      Listing inventory rose 7.4% to 131 units

·      Average square footage increased by 17.1% to 5,699 

Palm Beach Gardens Luxury Condo:

·      Median sales price surged 39.5% to $600,000

·      Average price per square foot rose 46.5% to $315

·      Listing inventory fell 44.2% to 43 units

·      Average square footage increased by 18.6% to 2,588

Palm Beach Gardens Luxury Single Family:

·      Median sales price fell 22.6% to $1,937,500

·      Average price per square foot decreased by 1.5% to $461

·      Listing inventory declined 12.1% to 131 units

·      Average square footage declined 18.5% to 4,837

Article by Isabella Zimmermann

Rewind: Michael T. Fay Tom Wood and Jacques Bessoudo Discuss COVID-19 Impact On Commercial Real Estate in South Florida Webinar

On April 3, 2020, PROFILEmiami hosted a webinar conversation with over 350 viewers on the impact that COVID-19 has, and will have, on the commercial real estate industry in South Florida. If you missed us live, or just want to revisit some of the insight our panelists had to offer, we have now posted the full webinar for you to sit back and rewind! Hear from some of Florida's leading real estate professionals about how they are reacting to the crisis, navigating the uncertain circumstances and preparing for future opportunities that may arise from the economic fallout.

Speakers:

• Michael T. Fay, Principal and Managing Director, Avison Young

• Jacques Bessoudo, Managing Partner, Galium Capital

• Thomas D. Wood, President, Thomas D. Wood & Company

• Moderator: Demetri Demascus, Co-Founder & CEO, PROFILEmiami

Topics:

• What effects have we seen on valuations, leasing and sales velocity, construction, availability of capital, and tenants in the South Florida real estate market so far?

• As a landlord, how are you managing your tenants right now?

• In the face of negativity there is always opportunity. Where do you think we will see opportunity open up?

• What is the current state of financing - are deals falling out of contract? Bank vs. non-bank sources of capital - who’s willing to lend?

• How are you working with your teams remotely? 

• How is the current economic crisis due to COVID-19 different from that of 2008?

• How will different types of lenders and loan products give different flexibility to the borrowers?

• What advise do you have for those that currently have financing on their properties?

• What is loan forbearance and how is it handled?

Link: https://youtu.be/OofUMQIa8EU