A new study confirms the latest chatter from real estate
watchers: Miami’s sizzling downtown condo market is cooling down. Skyrocketing
construction costs, overheated land prices and falling foreign currencies have
finally caught up with a housing market that boomed after the lean years of the
recession.
But unlike the last go-around, when highly leveraged
projects brought the house of cards tumbling down, few observers expect a
crash.
One sign of the current cool-down: the growth in resale
prices for downtown condos is slowing.
The average resale price
went up to $431 per square foot in 2014, a 16 percent increase from the year
before, but still down from jumps of 22 percent in 2013 and 27 percent in 2012.
Those numbers come from a report by the semi-autonomous, tax-funded Downtown
Development Authority.
Downtown-area developers currently have more than 22,000
condos units in development, with the majority slated for Brickell and the
downtown urban core. Some projects are nearing completion, while others are
still in the planning stages.
The average price per square foot, excluding ultra-luxury
projects such as 1000 Museum and Echo Brickell, is $563, according to the
report. Prices are higher on the water in Brickell and Edgewater and lower
further inland.
A
shortage of skilled workers isn’t helping either. The number of construction
workers in South Florida has fallen from about 168,000 in 2006, at the peak of
the boom, to 106,000 last year.
And land prices are going
up, up, up. Recent eye-popping sales include $125 million for the 1.25-acre Epic Marina site last
July and $80 million for 2.05 bayfront acres at 300 Biscayne Boulevard in
December.
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