More than $4.6 billion worth of new South Florida condo units have transacted — property titles have been conveyed from developers to buyers — at projects constructed east of Interstate 95 in the tricounty region of Miami-Dade, Broward and Palm Beach since this real estate cycle began more than four years ago.
Buyers have paid an average price of $1.2 million each for the more than 3,830 new condo units that have been recorded in the respective Clerks of the Court in Miami-Dade, Broward and Palm Beach where the projects are located as of Jan. 31, according to an analysis of government records by the preconstruction condo project website CraneSpotters.com.
Based on the recorded transactions through January, it can be conservatively estimated that this current preconstruction condo boom has generated more than $280 million in real estate commissions and about $50 million in title closing fees in South Florida.
Added to this, many of the preconstruction buyers are likely to have invested additional dollars with tile companies, interior designers and contractors to customize their new South Florida units with flooring, decorations and furniture regardless of whether the condos are to be retained or resold.
Local governments and school boards are also surely benefiting from the thousands of newly constructed residential properties — many of which will not qualify for the financial privileges resulting from homestead declarations claimed by Florida residents — that have been added to the tricounty region’s tax rolls since 2011.
As sizable as the dollar amount is to date, more than 10 percent of the 4,300 new condo units that are now completed in South Florida still have not been transacted and recorded, according to the data.
Overall, the South Florida pipeline of new condos east of I-95 stands at more than 50,000 units with more than 12,900 units currently under construction and an additional 32,800 in the planning or presale phase of development, according to CraneSpotters.com.
On a county-by-county basis, the supermajority of the new condo transactions in coastal South Florida have occurred in Miami-Dade, where buyers purchased nearly 3,300 units out of a total supply of more than 3,725 completed units for more than $4.2 billion at an average price of nearly $1.3 million each during this cycle.
To the north, buyers have acquired more than 405 new condo units out of a pool of 418 completed units for nearly $297 million at an average price of about $731,000 each in Broward and 135 units out of 160 completed units for more than $143 million at an average price of nearly $1.1 million each in Palm Beach as of Jan. 31, according to government records.
Further contributing to the amount of dollars being pumped into the local economy: More than 77,300 South Florida condo units located east of I-95 transacted on the resale market at an average price of more than $386,000 each since this current preconstruction boom began in 2011, according to data from the South Florida MLXchange.
Given the region’s boom-bust history, concerns are rising about the outlook of the South Florida preconstruction condo market in light of a strong dollar, an increased supply of new and resale units available for purchase and a new federal order that targets determining the identities of all-cash buyers of luxury Miami-Dade residential properties.
Developers and resellers have currently resisted reducing prices to attract buyers as they implement other sales strategies to transact their new and existing units. Incentives are now being offered to investors and real estate professionals, alike, that range from lease-back programs for buyers who want to rent out their units in the future to paying generous commissions of as much as 10 percent of the contracted purchase price of condos to brokers.
The unanswered question going forward is whether the dollar spigot that reappeared during this South Florida condo boom will continue to generously flow in the upcoming months and years of the real estate cycle.
Using Clerk Of the Court county records, below is a chart of the annual breakdown of the developer condo transactions compiled by CraneSpotters.com for new units constructed east of I-95 in Miami-Dade, Broward and Palm Beach counties between January 2011 and January 2016.
|Total price amount
of new-unit transactions
of new-unit transactions
Source: Miami Herald