South Florida Real Estate has consistently
ranked among the top markets in the nation for appreciating real estate values. Someone
who purchased a single-family Miami Beach condo or
Ft. Lauderdale condo in the late 1990s has ostensibly doubled
their investment over the past five to seven years.
As we look at this prolific growth in real estate values throughout our region, the
inevitable question is, "When is the bubble goin to burst?". My response to that
nagging question is that the South Florida
economy has, for the past several years, been working off a new global economic model
that has established a new base for business - and that there is no bubble to burst.
Why? Because this a very complex market, which is a good thing.
South Florida real estate is not impacted by one factor or any one group of
buyers. If that were so, there would indeed be cause for concern.
The thought of a bubble brings to mind a sense of artificial price increases without
real buyers who have real needs for housing. Nothing could be further from the truth
in this market. I like to refer to our "second-home" buyers as "dual-home" buyers
because more and more of them are living here for longer periods of time each year.
The following points outline some of the many factors for continued growth:
Continued Population Growth: Florida is the fourth most populous state within
the United Sates, with over 300,000 new residents added to our population each year.
To be exact, we are adding 930 new people every day.
Baby Boomers: The baby boomers have always loved Floria. The volume of
retiring "boomers" almost guarantees growth in and of itself.
Latin America: This market continues to expand in South Florida, with an
ever-increasing diversity in Hispanic Cultures. We are now selling second homes to
the 2nd and 3rd generations of families who originally purchased from us in the
Europe: Make no mistake about it, Europeans love South Florida. Go for a walk
on South Beach and see for yourself. The current Euro exchange rate is the same as
giving a European buyer a "one-third off" coupon frfrom just a couple of years ago!
South Florida Global Perception: South Florida is being viewed worldwide as
the "prototype international community of tomorrow". People with even minimal wealth
want to own a piece of Miami and Ft. Lauderdale. Our development community is
providing an option for every budget and every lifestyle.
At the end of the day, real estate values are created by "supply and demand." As the
demand increases for homes and the supply decreases, values will increase. The fact
that we have very little land left to develop in South Flordida, while we have an
ever-increasing number of people who want to come here, will continue to keep
pressure on values. Thus, values will continue to increase. South Florida's future
has never been brighter.