I’m off to NAREE, where for three and a half days all we do is talk about real estate. I’m moderating the panel on vacation homes featuring four of the nation’s top experts: Peter Kempf, president and CEO of Kempf International and an expert on the fractional market; Alex Iskenderian, Senior VP/COO Vail Resorts Development Company; Tom Anderson, Executive VP/Chief Real Estate Development Officer, Wyndham Worldwide; and Peter Zalewski, Principal Condo Vultures® LLC. I have a whole host of questions outlined, and Peter Z. was kind enough to send me this update on the Florida market:
South Florida is recovering at a brisk pace as foreign investors and second-home buyers with cash flood into the market. The weak U.S. Dollar combined with growing unrest overseas has made South Florida a safe harbor for foreign investors attempting to preserve wealth and take advantage of currency exchange rates.
Primary users (like families) are not a factor as they typically do not have the cash or the exceptional credit score required to hope to obtain financing today in South Florida.
South Florida real estate began its downturn in 2007. For certain product type in South Florida, an argument can be made that the market was symbolically backstopped in July 2010 when Wall Street money flooded into the state following a moratorium on the state’s “successor developer liability” regulation.
Ever since then, the market has been showing signs of stabilization and in some cases appreciation from recent record lows.
As of June 18, 2012, there are 35,650 condos, townhouses, and single-family houses on the resale market in the tri-county South Florida region of Miami-Dade, Broward, and Palm Beach.
A year ago, there were 49,350 condos, townhouses, and single-family houses on the resale market in June 2011.
In previous years, there were 65,900 condos, townhouses, and single-family houses on the market in June 2010 and 82,050 condos, townhouses, and single-family houses on the resale market in June 2009.
Back in November 2008 when we began tracking the data, there were nearly 108,000 condos, townhouses, and single-family houses on the resale market in South Florida.
On the shadow inventory front through March 31, 2012, about 3,900 developer condo units remain unsold out of a pool of 49,000 units created during the real estate boom in South Florida’s seven largest coastal markets of Greater Downtown Miami, South Beach, Sunny Isles Beach, Hollywood / Hallandale Beach, Downtown Fort Lauderdale and the Beach, Boca Raton / Deerfield Beach, and Downtown West Palm Beach and Palm Beach Island.
As the inventory has sold, developers have began to announce new condo towers to be built along the coast. As of June 18, 2012, there are 40 towers planned with at least 6,800 new units.