South Florida’s home market has been surprisingly resilient in coming out of the downturn. However, despite the high number of foreclosure, there is an increase in the number of buyers. The good news is that the market has rebounded nicely. From 2011 to 2013, building prices moved up rapidly; but from 2014 until recent, the prices are rising at a moderate pace.
The action is not all in for purchase housing; there are reports that rent rates are getting steamer too. In Miami for example, according to a study by The Integra Realty Resources; the lease rates increased by 6% in the first 9 months of 2014; with an average of $2.50 per square foot or $2,054 per months, this were leasing average for a one-bedroom houses. Additionally, a conventional one bedroom apartment were leasing at an average of $1.86 per square foot or $1,605 per month according to the same research.
Well, the truth of the matter is that such rental hikes might not be sustainable though contractors are busy building apartments throughout South Florida. According to Miami Downtown Development Authority report, it showed that about 2,300 new apartment units are set to be completed in the next two years. The number of these new apartments will double the inventory of professionally managed buildings.
2015 Building Trends In South Florida
2015 proved to be the pivotal year for South Florida during the existing preconstruction housing boom. The moment South Florida entered its 5th year of the real estate cycle; the year brought about some trends, which influenced the longevity of the current buildings around the area. The more foreign currencies continue to weaken against the dollar; it slows down the global economy. As such, the South Florida’s Preconstruction advised building developers to take financial safety measurements so that they could reduce risks as well as improve the chances of failing and guaranty success.
Competition for buyers in South Florida market was at least 415 per new building with more than 49,000 available units. These findings reportedly encouraged some of the most prominent developers the upper hand to come up with attractive building designs.
One of the leading notable strategies for commercial real estate that were implemented in the year 2015 included a hefty 50% pre-sale consumer security in some of the most active building markets. The broker’s commissions were reported to reach up to 10%. In addition, the spigot of building construction financing from traditional banks and private lenders appeared to be flowing and open in South Florida based on the type of loans that were reported in the last year.
2016 Building Expected Trends In South Florida
The truth of the matter is that South Florida is the most popular MSA in the state, with approximately 6 million residents. This is somehow surprising, with the number of reported percentage of foreclosures. However, due to all the trends experienced in 2015, it has been reported that there will be an increase in building costs as well as a rise in renting rates. In addition, the population is expected to rise from the recorded number recorded back in 2015.
The factors that will affect all the above trends are:
• Expected Tourism Growth
• Industrial Demand
• An Increase In Business Opportunities