Miami Home Sales Break Records over the Summer

By Sunny Isles Real Estate Expert on November 24th, 2015

Miami homes for sale

This past June was a record breaker for home sales in Miami. 1,390 single-family homes were sold. This was a record-breaking month as the highest month totaled 1,310 in June 2005. The month of July 2015 closed almost as many with 1,354 homes sold.

This is exciting news in the market as the prices for these homes have continued to rise year-over-year. Currently the price for a single-family home in Miami is up 8.6% and up 2.6% for condos. A single-family home that may have sold before for $255,950 is now $278,000. Condos that sold for $190,000 will now sell for $195,000.

Miami condos this summer also saw an increase in sales growing 4.8% year-over-year. 1,471 condos sold in July compared to last year’s number of 1,403.

This rise in home sales is thought to be from the city’s improving job market and low mortgage rates. Christopher Zoller, the 2015 Residential President of Miami Association of Realtors, refers to Miami as being “a global city with the second largest financial hub in the country.”

Mortgage Loans

The interest rate is down for a 30-year fixed rate mortgage. In July 2014, the rate was 4.13%. In July 2015, it had dropped to 4.05%.

The Miami Association of Realtors had this to say about mortgage loans in Miami in a recent report, “Despite the rise in sales, access to mortgage loans for existing condominium buyers remains limited. The lack of Federal Housing Administration loans for a large number of existing Miami condominium buildings is preventing further market strengthening.”

“Of the 8,523 condominium buildings in Miami-Dade and Broward Counties, only 29 are approved for FHA loans, according to statistics released earlier this year from the Florida Department of Business and Professional Regulation and FHA.” The statement goes on to report that only 0.0034% of local condos are approved for FHA loans. The U.S. average is 30%.

More Affordable Condos

Although the prices have seen increase year-over-year when compared to condominiums in global cities, Miami’s condos are quite affordable. A Miami condo which sells for $149,900 is comparable to condos in London ($960,840), Hong Kong ($776,280), and New York ($1.6 million).

The homes tend to sell near asking price. The Miami Association of Realtors reports that the average amount of days on market is only 41, compared to 43 in July 2014. The original list price received was 95.6%. As for condominiums, the days on market remained at 59, the same as July 2014 and the average list price received was 93.8%.

Cash Buyers

Cash purchases accounted for 48.2% of total home sales in July 2015. The national average is 23% in comparison. Miami’s number of high cash purchases is due to the fact the city attracts international buyers that tend to purchase properties in cash, according to the report.

The outlook for the housing market continues to be bright as increases in home sales continue despite the lack of FHA and price increases.

Faena House Attracts Big Name Buyers

By Sunny Isles Real Estate Expert on November 13th, 2015

Faena Miami Beach Penthouse

In early September the first of the four highly anticipated Faena condo towers (see all available Faena condos for sale here) reached completion. Faena House, or the 3315 Tower condominium, stands 18 stories and houses 44 ultra-luxury units. Transactions for the project started to be recorded on September 3, according to deed records in Miami-Dade County.

It wasn’t long before names of buyers started coming out in the world of real estate news. It certainly comes as no surprise that many of those buyers are highly recognizable players in finance and other high-powered industries.

Timeline of Early Faena Sales

On September 25, real estate publication The Real Deal reported that the rooftop penthouse at Faena had sold for an astonishing $60 million, a price that shattered the existing Miami residential record by $13 million. With eight bedrooms and 9900 sq. ft. in exterior living space alone (featuring a 70 ft. rooftop infinity pool), the 12,516-sq.-ft. luxury pad went for just under $4800 per sq. ft.

By early October TRL learned that the penthouse had been purchased by Kenneth Griffin, the billionaire hedge fund manager and CEO of Citadel, an investment company. This revelation shouldn’t have come as a surprise as Griffin has reportedly spent nearly $300 million on luxury real estate in New York, Chicago, and Miami Beach over the past couple of years.

On the heels of Griffin’s massive purchase came the sale of unit 9-B, to Brian and Randye Kwait of Greenwich, Connecticut. Brian Kwait is one of the founders of Odyssey Investment Partners, a private equity firm that has raised over $5 billion in funds since its inception in 1998. The Kwaits will enjoy 5400+ sq. ft. of luxury, including four bedrooms, five bathrooms, and an elevator that serves as the unit’s entrance.

On September 30 TRL revealed that yet another one of Faena House’s premium condos had sold. This one, on the sixth floor, was purchased by Aventura-based company ABF6A LLC for $11.75 million. Unit 6A boasts four bedrooms, six bathrooms, and more than 4700 sq. ft. of living space, plus a terrace nearly a third the size of the condo itself.

TRL again reported on a Faena buyer on October 12, this time the CEO of a London-based transportation company called Addison Lee (a competitor of Uber). Daryl Foster, also a shareholder in Infinity Creative Media Ltd., shelled out $8.8 million for a handsome 5466-sq.-ft., four-bedroom, five-bathroom piece of the Faena pie. Unit 7B has 4165 sq. ft. inside and 1301 outside. Foster’s address on the deed was listed in Monaco.

Faena Miami Beach condo for sale

The list of elite buyers into the luxury condo building continues with names like Mark Rachesky (CEO of Lions Gate Entertainment), Goldman Sachs chairman Lloyd Blankfein, and sugar mogul Jose F. Fanjul, Jr.

With this phase of the project sold out, developers Alan Faena and Len Blavatnik turn their focus to the remaining towers – Faena Hotel (the former Saxony Hotel), Faena Versailles Contemporary, and Faena Versailles Classic.

Second Quarter Sees Growth of Home Sales in Miami

By Sunny Isles Real Estate Expert on October 3rd, 2015

Miami real estate for sale

There is no question that Miami is one of the hottest cities when it comes to real estate, and it has been doing quite well every since the economy and the real estate market started to recover. They city and surrounding area has seen a nice increase in the number of sales, as well as the price of homes, in the second quarter of 2015 when compared with the previous year.

Miami Is Still the Place to Buy

During the second quarter (April, May, and June) of 2015, there were 3,913 homes sold in Miami. This number marks an increase of 7.2% over the same months in 2014. During that time, the median home price happened to go up as well. It rose 10.6% from $245,000 to $271,000. Normally, when the prices go up by more than 10%, you don’t see the number of sales go up as well. People tend to slow down and consider other areas. Of course, Miami doesn’t have that trouble at all.

People want to live in Miami, even if they might be paying more than they would have a year ago. The vibrant city, the proximity of the beach, and the fact that the real estate value has such a potential to keep rising is encouraging more and more people to buy in Miami. Some of the buyers are from the United States, but there are a number of foreign buyers as well. Canada and China are just two countries that have a lot of residents looking at Miami property.

Another thing to keep in mind is that the number of homes offered between last year and this year has remained about the same. Even though there is approximately the same number of homes on the market, the sales have picked up, and that means that buyers are going to be competing for properties. Naturally, this has the potential to push the prices higher, as it becomes a seller’s market.

Both buyers and sellers are confident in the market, and that is really helping to push the sales to the next level. Considering the fact that mortgage rates today are actually very low, and that the price of the homes, even though they’ve been rising, are still affordable for many buyers, and it is easy to see why the sales have been growing this year.

While the single-family homes have been doing very well, the sale of condominiums has slowed down slightly. According to reports, even though the sales prices for condos increased, the number of sales dipped by about 1.8%. New listings for condos dropped as well, but that certainly doesn’t mean condos are necessarily struggling.

The Miami condominium market is faring decently when compared with many other areas, and with the increased interest in Miami, it is possible that the sales will pick up between now and the end of the year. With all that Miami has to offer, it is no wonder the desire to live in the city is continuing to rise.

South Florida Home Price Growth Is Slowing

By Sunny Isles Real Estate Expert on August 20th, 2015

Miami real estate

While the homes in South Florida have seen nearly continual increases over recent years, a new analysis by RealtyTrac shows that those rises are starting to slow. The analysis showed that while home prices increases grew by 20 percent year over year in 2013, they dropped to only 10% in February of this year.

While Pompano Beach and Fort Lauderdale also saw the same drop to only a 10% increase, this is actually reflected on a national level as well, with other major cities seeing the same rates of slowing appreciation. Overall, however, some experts feel that this decline is not necessarily a bad thing.

Potential Issues with Continued Increases

Ob Jacobi, who is the president of Windermere Real Estate in Seattle explained that “if homes were to continue appreciating in the double digits for too long, we could run into the same boom/boost market of years past”. Considering that the wages have not kept up with the increases in home prices, this may be a very true statement in Miami. The report also indicates that future expectations for home prices is that they will rise only single digits, rather than the double digits that realtors and investors have come to expect in the area.

Other Statistics

The report also provided other notable statistics as well. While average home prices have seen a decrease, those that have a $1 million price tag or higher have actually increased in the percentage of sales by 4.25%, which is higher than the previous year’s 3.46%.

The report also showed a few interesting changes in median home prices and foreclosed properties. As of February, the US median home price was $183,000, which is an increase of 14% over the previous year. Foreclosed property prices also increased by 17%, leading to an average price of $127,000. This jump shows that the previous savings seen on foreclosed properties after the 2013 mass distressed buying is waning, which will also help slow appreciation levels down to single digits as home buying returns to a more even market.

New Highs in Other Cities

While Miami and a majority of other major metropolitan areas saw decreases in home prices, there are others that fared much better. Denver, Colorado, San Jose, California and Austin, Texas all saw historic median home price increases over the last year.

Increase Drivers in Miami

The reason that there is not much concern over the 50% decrease in Miami is simple. The boom in Miami luxury condos and residences, many of which were purchased with foreign cash, is one of the main reasons the home prices were increasing so dramatically. As these multi-million dollar homes were moving in and being sold, it was driving the prices of single-family homes up, as well. This was since many middle-class residents started moving further inland.

Even with these on-going changes, there is little doubt that the Miami real estate market is still growing strong, and as far as luxury homes go, doesn’t show any sign of slowing in the near future.

No Housing Bubble in Sight

By Sunny Isles Real Estate Expert on July 21st, 2015

Miami real estate

Statistically speaking, housing is on a roll. Year-to-date home sales are up 6.3 % and prices in May were 7.9% higher than a year earlier. The trends are expected to stay positive and are likely to boost business dollar volume by as much as 15% in 2015. These statistics don’t even include new home construction, which is growing at a strong clip as well.

But this rosy picture does raise concerns about affordability. After all, wages are rising by only 2% annually and renters are getting squeezed, having to endure 4% rate hikes while home prices accelerate more quickly. In addition, mortgage rates have notched their highest level of the year, reaching about 4% in June, and should continue to rise well into next year.

Some armchair analysts have suggested that we’re entering a new housing market bubble. But hard facts suggest otherwise. Underlying conditions today are fundamentally different from the bubble of a decade ago. Back then, credit was easy to obtain and home sales were running at more than 8.5 million a year (existing and new homes combined). New home construction volume topped 2 million annually.

By comparison, credit today is extremely tight, which has led to an unusually high level of all-cash sales. Home sales are barely over 5 million and new home construction is barely scratching 1 million units. Meanwhile, for the past eight years, total mortgage balances have failed. The reasons show what’s changed from 10 years ago: home owners are paying their mortgages on time and few are seeking cash-out refinances.

It’s fair to ask, though, whether at some point affordability problems will choke off home buying. That’s possible. But there’s my thinking about what could neutralize those fears. After running various scenarios, I expect home prices to rise continuously as long as mortgage rates remain under 6%. Early in the summer, the average rate was 4%. It may rise to 5.5% by the end of next year. Should mortgage rates cross the 6% mark, maybe two years down the road, then either home prices will be flat or other forces will be evident. Going forward, keep in mind that robust job creation and meaningful increases in income levels will help propel home prices. For now, though, no bubble or impending crash is in sight.

By Lawrence Yun, NAR (National Association of Realtors) chief economist.

In France, the Response to South Florida is a Resounding “Oui!”

By Sunny Isles Real Estate Expert on June 29th, 2015

Miami condo for sale

Miami-Dade County has become a hotspot for foreign buyers from all over the world, but the France is sitting in the top spot when it comes to European countries whose citizens are taking a very close look at what South Florida real estate (see website here) has to offer.

While France has taken notice of South Florida, realtors and developers have noticed the interest as well, and they are certainly playing into it. So much so, that ONE Sotheby’s International and Century 21 both use Janet Choynowski’s website to translate their listings into French so that potential buyers can search for homes in their native language.

French Search Patterns

Choynowski, who has researched the nationalities using her site, has also tracked their search their patterns. What she discovered about the French searchers was that they are generally males that are interested in sports. Additionally, most of them also began their searches by checking out a few properties in California. After that, the searchers ended up looking at properties in Florida. Another interesting thing about those Florida searches: there were also more page views on properties in the area, as well.

US Interest

It isn’t a secret that foreigners have an interest in the US. After all, there is plenty to offer. However, the main draw from the searches revolves around the weather and waterfront. Warm sunny climates and waterfront locations garner more interest, and of those, South Florida is the hands down winner in France and among other international potential homebuyers.

Another part of the interest is based on the types of outdoor amenities that are offered by the properties. Paramount Miami Worldcenter, which is a current project that is being brokered by OneWorld Properties, is a location that caters to those desires. This condo tower is a total of 60 stories, and it will include a number of outdoor amenities, including pools, a running area, a soccer field, and tennis courts in the ninth floor recreation deck. Additionally, the floor will also be home to 12 two-story Balinese-style villas that are situated among water features and pools. The final outdoor space attraction is the outdoor living rooms that replace the traditional balconies.

Foreign buyers have shown interest in the Worldcenter, and currently, 15% of the total reservations made since sales launched have been European natives.

Euro Value

Another major consideration for European buyers is the value of their own euro, which is decreasing. When these buyers invest in properties or second homes in areas like South Florida, they are able to preserve their fortunes, despite the lowering in value of their own currency. As the interest in South Florida continues, it is also easy to see that these investments are lucrative, as home sale prices continue to increase, as do the number of home sales that are all cash. Again, a vast majority of these are buyers that are coming from all over Europe, and this is not a trend that is showing any signs of decreasing in the coming year.

Chinese Interest Growing in South Florida Real Estate

By Sunny Isles Real Estate Expert on June 24th, 2015

Miami preconstruction condos

While Latin American investors have begun to decline in South Florida, there is a new player that is quickly emerging to take their place – China. In fact, their potential is so great that many firms are taking serious steps to accommodate these new investors.

• Shanjie Li, from Da Tang Group, has created a campaign specifically to attract Chinese investors. The campaign is designed to generate interest through opening a Cantonese restaurant for high-end tastes, as well as other areas of focus to generate greater interest in spas, condos, and shops that he plans to develop – all in an effort to make SoFla a welcoming haven for affluent investors from China. His plans include:

o A luxury Chinese restaurant in the Four Ambassadors building
o Condos geared towards business professionals
o A wellness center for those needing pampering and retirees
o A Doral-based golf community for Chinese vacationers
Paramount Miami Worldcenter, a tower of signature luxury condos located in downtown Miami that is scheduled to open by 2018, has Feng Shui consultants on staff to assist with project design to increase Chinese interest, and even removing numbers from floors and units that the Chinese avoid in their culture.

The two towers of the Estates at Aqualina, which was developed by the Trump Group, named both towers using numbers that are considered lucky in Chinese culture. Countless other brokers and developers are taking major steps to attract Chinese buyers, including translating brochures into several different Chinese dialects, wooing potential buyers by visiting Shanghai and Beijing.

There are also many other developers and brokers that are following these footsteps to capture the interest and potential cash that Chinese investors are expected to spend in South Florida.

Why the Heavy Focus?

SoFla is a gorgeous location that already caters to the elite that can afford the multi-million dollar trophy homes, but many firms have noticed a sharp increase in interest from Chinese buyers. Additionally, these buyers are paying cash, and that is worth all of the effort going into attracting them. So far, the Paramount location has received 20 reservations from Chinese investors, all of them prior to the official open of the project.

The Ritz-Carrolton Residences that are located on Singer Island have already sold seven units, in addition to three others at the Miami Beach location to investors from China. There are also many other locations in the region that have noticed an upswing in interest and purchases by Chinese buyers, and nearly all of them are for million dollar homes.

There is no denying that there is a trend in both the Chinese interest and purchases of luxury homes in South Florida (click here to view listings), and brokers and developers are doing everything they can to continue to push sales.

Faena Miami Beach Developments Expanding

By Sunny Isles Real Estate Expert on June 20th, 2015

Faena Miami Beach

Hotelier Alan Faena has announced that there will be two more additions to his Faena Miami Beach, bringing the total up to three condominium towers, a retail and event complex and a hotel that are all being pitched by Faena as an arts hub. Each tower will be designed around its own concept, providing additional luxury that meets varying tastes.

Faena Contemporary

Faena Contemporary, which is expected for occupancy in 2017, will feature 41 units. The luxury residences will be from 1,111 square feet up to as large as 5,469 square feet. The units will be available with one to five bedrooms. There will also be two different penthouses that will be more than 8,000 square feet. One of the penthouses will also include a rooftop deck of 6,600 square feet, and an infinity pool that is 2,097 square feet.

Faena Versailles Classic

The second of these two towers is the Faena Versailles Classic, which is located at 35th and Collins Avenue in the former Versailles Hotel. This tower was designed by William Sofield, and will feature 22 units.

Each unit provides a wealth of amenities, with gorgeous ocean views in every unit. The condos will also feature customized bathrooms and kitchens. Each unit will range from 1,034 to 2,743 square feet, with one to four bedrooms. There will also be two duplex penthouses with a square footage of up to 7,300.

Even with the renovations, the 1940s-era façade, custom chandeliers, terrazzo flooring and the grand lobby are all being preserved to add to the classic feel.

The Faena Contemporary and the Versailles Classic will also have a range of amenities, including gardens designed by Raymond Jungles, two gyms, valet parking, storage space, and a preferred status to of areas of the Faena district.

The units will only be available through the Douglas Elliman sales and marketing firm, with prices that will range from a minimum of $3 million up to over $50 million.

Faena’s Vision

Faena’s vision is to do the same in Miami that he did in Buenas Aires, which was to create a neighborhood that was a mix of art, architecture, taste and, of course, food. The Miami Beach project is Faena’s dream to take the area from a sleepy one into an epicenter for the city, with efforts towards its art hub development.

Interestingly, the normally difficult to deal with historic preservationists and planners are all behind Faena’s dream as well. His goals of combining the contemporary designs of his buildings with a MiMo design that pays homage to the roots of the architecture in Miami Beach.

In all, this dream and project that Faena is creating in Collins will cost an estimated $750 million by the time it is all completed. With a focus on art, and a family friendly walking environment that will replace the currently traffic-choked area, Faena hopes to recreate Puerto Madero magic in Miami. They imagine a neighborhood which will combine art, luxuriousness, old and new architecture, and a touch of old world glamour all into a single neighborhood.

Palazzo del Sol Penthouse Sells for Record-Breaking $35 Million

By Sunny Isles Real Estate Expert on May 18th, 2015

fisher island condo for sale

Exclusive Fisher Island real estate, which is home to a number of CEOs, athletes, billionaires, and stars from over 45 different countries that make up its 675 families, ranks as one of the highest per capita income zip codes in the US. It is to be expected that there are going to be some pricey homes in the area. However, even the residents who are accustomed to luxe homes and posh surroundings were impressed by the Palazzo del Sol penthouse that recently sold for a record-breaking $35 million.

Highest Island Sale Ever Recorded

The Palazzo del Sol, which is scheduled to be completed in early 2016, is a 47-unit tower and the first new construction in the area in over 7 years. The units are currently 47% under contract, and the buyers are from locations all over the world including Spain, London, Mexico, New York, Turkey, Venezuela, and Brazil. Penthouse 2 was purchased by a Russian buyer, who paid $3,602 for each square foot of the 9,715 square foot space. This is more than 2.5 times higher than previously recorded record sale, which was $13.5 million for a 6,170-square foot penthouse that had been built in 1992 and owned by Oprah Winfrey.

The $35 million penthouse #2 is one of three available in the space, and has many amenities, including:

• A private elevator
• 18-foot windows that provide panoramic views that include South Beach, the skyline of Miami, the Atlantic Ocean, and the Biscayne Bay
• An open floor plan
• Seven bedrooms
• Seven and a half bathrooms
• A theater
• An exercise room
• A bar and lounge
• Separate family and dining rooms
• Four terraces
• A zero-edge swimming pool
• Outdoor entertaining areas and a summer kitchen designed by Enea

The kitchen and bathrooms are Boffi, and include SubZero, Duravit, Dornbracht, and Gaggenau fixtures. Together, the combined indoor and outdoor spaces total 8,595 square feet.
The Palazzo del Sol itself is also designed to provide luxury and amenities that are meant to impress. These include a The Wright Fit fitness center, a hair and makeup salon, cinema style theater, professional fur storage, two lobbies, an aperitivo bar, private massage rooms, Kidville playroom, and integrated media meeting rooms.

Fisher Island itself has undergone $60 million in renovations to locations such as the Vanderbilt Mansion, the oceanfront Beach Club, and a wealth of additional amenities that include a championship P.B. Dye professional golf course, marinas, and a Spa Internazionale, which have all gone to attract even more of the international spotlight.

However, the addition of the Palazzo del Sol is adding to that international appeal and according to the leader of pre-construction sales for the development, Dora Puig, it is also “reasserting its position at the top of South Florida’s trophy real estate market”.

While the $35 million penthouse is in a class of its own, the rest of the units in the tower start at $5 million, which is none too shabby for the Fisher Island locale. With these prices, the island just might be making its comeback. See all condos on Fisher Island currently available for sale here:

Home Prices on the Rise Nationwide

By Sunny Isles Real Estate Expert on April 5th, 2015

Florida real estate for sale

A few short years ago, the real estate market was in a substantial amount of trouble. Home prices were dropping, people were unable to buy and to keep up with their mortgages, and it was a bleak time for most. Fortunately, the economy has strengthened, and things have started to change quite a bit for buyers, sellers, and real estate professionals. The prices of homes are going up around the country, and this means that the market is recovering nicely. Some feel that it’s already back to the point before the last storm, and that the additional safety measures in place today will reduce the chance of another crash.

Prices Going Up

When comparing the home prices across the country from November 2013 to November 2014, you can see that there is an increase of 5.5%. This is no small amount, and it’s important to remember that this is just an average of all of the states. In some areas, such as South Florida, the prices are doing even better. Look at the Miami area, for example. Prices are up by about 8% in the same timeframe, and it doesn’t appear as though the price increase will be slowing anytime soon.

It’s important to remember that even though the prices are getting higher and more favorable, things are not quite back to the same levels prior to the recession. For example, Nevada, Florida, Arizona, Rhode Island, and Connecticut still have a long ways to go before they are able to match those previous prices. Still, most experts feel as though the prices will continue to go up for a number of reasons. See Florida real estate here:

Buyers from Around the World Want US Property

They feel that any lulls in price increase will only be temporary, and that the prices will keep rising as more and more people start to get into the market to buy homes. There are plenty of domestic buyers who have an interest in the South Florida area, and they are starting to look into new properties. New Yorkers, for example, find that even with the increased prices for Miami homes for sale, the cost is far less than what they would be paying for properties in NYC.

It’s not only domestic buyers who have an interest in purchasing properties in the US though. In fact, there are many buyers from China, South America, Europe, and Russia who have quite a healthy interest in the Miami area, and they are starting to snatch up properties. Some are looking to move to the US, while others are looking for vacation homes. Some are investors. There are many reasons to buy, and this is helping to push the demand for properties in the area.

Even though there is a surplus of properties in some locations, that’s not stopping developers, who know that the demand is continuing to grow. Many new luxury condo towers are going up in Miami all the time and buyers are trying to get in on the action now, before the prices go up even further.