Where to invest in South Florida now

Question

The Miami market is continuing to show price growth and some inventory growth. Inventory for single family homes continues to be very tight and I see the best opportunities to invest in single family homes in established and emerging areas.

There are a lot more condos coming on the market now: a lot of people are looking to sell after the strong appreciation in the past few years and there are thousands of new units being added by new development projects that are now being completed.

I've looked at a lot of condos and houses in the past few weeks and from being in the field I can tell you that the transaction volume is picking up again - a lot of places are going into contract and prices are holding up well.

My two favorite investment opportunities right now are single family homes in the top areas that your budget can afford and condos in buildings that were launched 4-6 years ago, are now in the market and have a lot of selling pressure because people who bought pre-construction want to sell and take profits.

What's your take on the current market? Where do you see opportunities?  Let's chat about the market and if you need personal advice on Miami or Fort Lauderdale real estate just message me.

Christian Busch · Answer

@Jay Lutz eventually most of the older buildings will be demolished. Some in prime locations will be bought by developers and others will probably deteriorate and eventually shut down - that may take decades though. Upkeep and HOA are challenging for these buildings.

Jay Lutz · Answer

@Christian Busch @Khalid Bryan How do you think the changes to the condo association inspection reporting and reserve requirements are impacting the market? Are people getting spooked out of older buildings / concerned about huge assessments? What's the ratio of these properties in the market?

Also, to what degree are people reacting to the new insurance rates? We were looking at a $115,000 condo, but the insurance deductible was $25,000!

Jay Lutz · Answer

Is your general expectation in this case, that all the older buildings will eventually be demolished? Or that if your building 20th century you should move? (@Christian Busch)

Christian Busch · Answer

Investing in affordable housing definitely makes sense if you can make the numbers work. There are still areas where you can buy units for $200k/ door but they require a lot of work usually and covering all operating expenses and interest payments can be challenging base on low-ish rent levels in some places.

Khalid Bryan · Answer

@Khalid Bryan another option if not affordable rental properties is if you would like to try the BRRR method I would look for properties that are not moving ready or maybe the condition prevents them for qualifying for an FHA loan or low down conventional loan, and do the necessary repairs to make it safe to live in clean and fresh. Similar to the Rental market the influx of incoming new residence from other states has definitely helped our luxury market. However, the local who have been here with metal class incomes still have the dream of home ownership and fully renovated luxury options are not the best choice for them. There is definitely a need for clean units that still have a level up upgrades that can be done after closing by the new buyer. Sometimes the issue is they just need something they can use their loan on and a lot of our options are fully renovated and priced over their reach or need so much work. They cannot use their loan. Keep in mind, however, FHA buyers cannot purchase a property that has been owned under a certain time frame. you will have to hold onto the property for a few months to sell to an FHA approved buyer. I don’t remember the timeline off the top of my head but it’s a simple Google search to find out.

Khalid Bryan · Answer

@Christian Busch i’m a broker that specialize in income producing properties so I end up working with buyers sellers and tenants. The one area in the south Florida market. I see an extreme need for is affordable housing. While a lot of investors are trying really hard to capitalize off of our influx of high income earning new residence and the fact that we are home to the most million and centimillionaires ($100M+) the market doesn’t call for all properties to be fully renovated. I find a large need for a clean, safe, affordable housing. ￼ the ideal property. If you’re looking for stability is a nice well-maintained apartment building with affordable units with a bedroom and bathroom make up that suitable to the area. It’s uniquely in if you have nice clean affordable apartments for rent, the people will come as long as your price is right.

Where to invest in South Florida now

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