After almost a decade of empty units in a sinking market, Miami’s condo market is righting itself. What’s feeding the bounce back? A new focus on renting and a surge of foreign (primarily South American) money, as Roben Farzad writes for Businessweek.
Miami’s growing rental market is filled with aspiring-homeowners-turned-renters and condo flippers-turned-owners. Unsurprisingly, rents are rising and the increasing rents are actually fueling demand for new condo buildings.
Something else encouraging more condos is the growth in population across the state of Florida. Farzad writes that with almost 20 million people, Florida will have the third highest population in the U.S. by 2013. Condos are also expected to sell out by next year, with less than 10 percent unsold in the last quarter of 2012.
“South Florida’s newest condo boom-and-bust cycle is just getting started,” he [Peter Zalewski, principal of Condo Vultures, a local brokerage and research firm] says. “Developers are already rushing into the market to secure their sites.” Zalewski says he has tallied 70 proposed towers in South Florida, with nearly 10,500 condo units planned—18 percent of them already sold. “The only thing they’re waiting for,” he says, “is the return of condo construction financing, which is still elusive in South Florida.”
The influx of South American cash, Farzad says, is solving the latter problem and pushing new condo buildings to break ground.
While the foreign interest and population growth aren’t representative of other areas of the country, the turn to renting is a model for all those cities that over-reached and overbuilt.