After a resounding boom period, Miami is facing a condo bust. Developers are beginning to cancel projects and are slashing prices as condo sales slow.
After easy financing, and rising prices, developers put 21,000 new units through 2004 to 2008, many of them still sit empty, the Wall Street Journal reports.
“The condo market has peaked,” says Neisen Kasdin, a real estate development lawyer at Akerman in Miami. “Sales velocity has slowed down considerably.”
The luxury markets in gateway cities like NYC and LA are all seeing some of the same problem. As the dollar ramps up (not to mention those oil prices), wealthy foreigners no longer have the cash to fill out all of the new luxury construction.
Miami in particular is being hit by the decline in South American buyers. Brazilian currency has fallen nearly 42% against the dollar since 2014, while Argentine money has dropped over 40%.
“The depth of the Chinese market, or the European or Canadian market, is not enough to make up for the South American buyer,” says Anthony Graziano, senior managing director at Integra Realty Resources. [WSJ]
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