Rising Prices Along Miami’s Waterfront

August 20, 2015
luxury water front condo in sunny isles beach south florida

With a limited amount of land to develop and huge demand, Real estate prices continue to escalate along Miami’s waterfront. In the last five years, the price per square foot for Miami’s highly desirable waterfront properties has nearly doubled or more. With nowhere left to build along the ocean or inter-coastal, developers are turning their attention to the last remaining waterfront in this burgeoning metropolitan area, the river. For purchasers the luxury market remains competitive, and developers are beginning to experience a squeeze. However, Miami’s waterfront luxury market offers a lower price per square foot than comparable U.S. cities such as San Francisco, New York or Los Angeles. In relative terms, Miami is still a very good deal.

The median price in Miami Beach for luxury market single-family homes is $2.8M, and for condos it is $1.95M. Miami Beach properties sell on average in 144 days. In Bal Harbour, the median sale price for single-family homes is $5.425M, and for condos it is $2.69M with properties selling on average in 175 days. In Sunny Isles, the median sale price for single-family homes is $2.43M, and for condos it is $2.1M. Properties are selling quickly averaging 126 days. In Surfside, the median sale price for luxury market single-family homes is $2.45M, and for condos it is $1.8M with properties selling on average in 204 days. Fisher Island condos are selling on average in 168 days with a median sale price of $3M. In Key Biscayne, the median single-family home sale price is $2.75M, and for condos it is $2M. Properties are selling on average in 152 days. Sunny Isles continues to the be one of the hottest areas in Miami to purchase, and Bal Harbour remains one of the most expensive areas.

Despite the cool down in out of the country buyers, there is still tremendous demand for luxury real estate. In the last five years, waterfront areas such as Bal Harbour, Sunny Isles, and Miami Beach have experienced significant growth. Developers have built luxury state-of-the-art luxury condominiums to meet this growing demand. It is also estimated that over 50% of luxury ($1M plus) purchases are still all-cash. In addition, Miami’s homes are selling at a reasonable pace. In general, steady sales are preferred over the bidding wars seen in places such as the Bay area, which can indicate a bubble.

Related: Miami Community Spotlight: Sunny Isles

While Miami’s waterfront luxury condo market tends to dominate the conversations, strong luxury single-family home sales also suggest market stability. In general, single-family home sales represent long-term investment in the city since these buyers tend to be families. An increasing number of buyers are purchasing properties as permanent residence rather than as pied a terres in Miami. Overall, Miami’s luxury real estate market is robust. Over the next ten years, the market is expected to continue steady growth in parallel with its rising prominence and significance as a global city.
 

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