Providing real estate stats for South Beach real estate, as you could guess, is not all that exciting. I’ve had that stats for about a month now but haven’t posted them because I feel that providing the raw data WITHOUT insight is offering no service to my readers and my clients.
The last month has given me some ideas on how to present this info AND add value. About four or so years ago, I read an article about NYC real estate in which Pam Liebman, CEO of the Corcoran Group, passed on a bit of wisdom which, at the time, I had no idea that I would be referring back to it so much for insight:
“The Best Neighborhoods Are the Last To Go Down, and The First To Come Up”
Now while an uptick in prices are far from a reality, it gives the following numbers the perspective I feel I need to include when I do stats. After all, this is MY business. I know my business better than anyone out there, so who better than me to add insight, albeit borrowed from a very smart cookie, to the stats.
South Beach Condos: It’s Not Pretty, and It’s Okay
The only way to sell ANY real estate in this market is by showing value. That’s is how I am able to continue to help my clients sell. No longer is pricing your Miami Beach real estate using the latest comps good enough. To show value, a seller must be lower, sometimes MUCH lower than the recent comps, to attract any attention.
As I’ve said before, a good rule of thumb is that 10% of the units in each condo represents a healthy market. Obviously, we are not in a healthy market. Apogee South Beach and the new Continuum North get “kind of” a free pass because they finished at a really bad time, and investors (flippers/speculators) list those units for sale at the same time (at opening). Except for Yacht Club and South Pointe Tower, all of the other seven buildings are starting to choke on their own inventory.
Here is how the sold $psf is shaping up so far:
|Condo||2008||1st Qt. ’09|
For the first time since I’ve been doing these stats, the actual $psf is decreasing for luxury condos in this South Beach neighborhood, and that is a good thing.
Okay Kevin, Why Is It a Good Thing?
Well, the South of Fifth (SoFi) neighborhood has been relatively unscathed from Miami’s condo drama. Our market changed in April, 2005. So for about four years Miami Beach real estate pressed on. I was always amazed when doing these stats, given the stories, stats, and predictions for Miami real estate, that this sector of the market defied EVERY story, report, or analysis.
This neighborhood was never affected by the sub-prime stuff. I would venture a guess that 80% of the condo sales in these nine buildings were purchased in cash. Mortgage fraud affected one of the buildings in particular in the neighborhood –which lead to many foreclosures.
Why Location is So Important
The only way to clean up this real estate mess is a return to fundamentals. Real estate is governed by the law and supply and demand and location, location, location.
South Beach was the catalyst for Miami’s renaissance. South Beach is now so big it is a brand. When people talk about “Miami” the really mean “South Beach.”
So here’s my prediction: South Beach condo prices are heading down, down, down. In fact, I’m privvy to a few pending sales that will be very shocking to many, and that’s good; because if what Pam Liebman said is correct, then we very well may be at the end of our tough time.
Want a Deal on a Miami Beach Condo?
Here’s a great little feature you can find on my site www.kevintomlinson.com. If you are looking for a foreclosure or short sale, I’ve made it very easy to find them:
Click on any of these searches to find bank-owned Miami Beach condos, or short sales. You can also check the new listings and recent condo sales.
Also you can search for distressed property by building. In the top left corner of the image above, you can select any building then click on the “View Listings” button in the middle of the page.
All distressed condos will have a “S” if it is a short sale or “F” if it is bank owned. Click here to check it out.