After a long, cold housing crash, Miami bounced back to a record year in 2014. Like the city itself, however, some of the rebound is over-the-top and potentially overheated, specifically in condominiums.
Sales of single-family homes increased 7.7 percent in the fourth quarter of 2014 from the same period in 2013, according to the Miami Association of Realtors, but condominium sales fell 3.3 percent. What is particularly troubling is that the drop in condo sales comes as thousands of new units are headed to the market.
There are currently 325 new condo towers proposed, with just more than 41,200 units. Of that, roughly 13,000 are in the planning stages, 15,000 are planned and approved, and more than 13,000 are under construction, according to Peter Zalewski, founder of Condo Vultures, a Florida real estate company. Developers claim there is huge demand, and they are requiring large down payments this time around, but Miami has seen this before, barely a decade ago.
"Every year that goes on, you have to get a little bit more and more cynical and skeptical as to whether or not developers will be able to deliver what they ultimately promised, and we know what our history is here for the last century," said Zalewski.