It’s no secret that the Miami condominium market is a little bit shaky at the moment.
In March, we broke a 15-month streak of declining sales, but April resulted in a 12.5 percent year-over-year decline, from 1,269 sales last year to 1,111 this year. In a moment of so much volatility and uncertainty, it falls to experienced real estate professionals to make sense of this market, and to advise their clients accordingly.
With that, I offer you the same advice I am giving to my own clients:
1. There is always a good time to buy: As I write this, condo prices seem to have leveled somewhat. When sellers are serious, they will pay attention to market conditions, the most recent sales, and price their units fittingly. Some readers may be surprised to learn that the price difference between asking and selling (in the condo market) is now less than 5 percent. Buyers should understand this, and be ready to make appropriate and legitimate offers. Well-priced properties are not lasting more than two or three months on the market.
2. This is probably the best time to buy new construction: There is an extraordinary volume of inventory in the condo market from both builders and original purchasers. (In fact, there are so many resales that the new construction pricing is almost matching what was purchased preconstruction three to four years ago!) Serious new construction buyers can now look, feel and smell what is brand-new, and then take their time to find the perfect option for them.
For example, I had a client who had been shopping for a preconstruction condo for the past three years. Two years ago, when Aqualina and Regalia were the only two newer developments available in the area he wanted, we put in a couple of offers in those buildings that were ultimately not accepted. When I took him to Château Beach this past year (where he once again could feel and see what he was getting) he immediately purchased a unit in that project.
3. Always consider multiple attorneys: I treat my buyers as I would want to be treated: honestly and with complete transparency. However, and unfortunately, our business draws all types of people, and so I always, always, always recommend that my clients interview and pick from two or (even three) attorneys to represent them on their deal. I want them to understand exactly how they will be purchasing their units, the complexities of the contracts, and what is involved in their monthly costs.
This is especially true for my international buyers, who may not be as familiar with American real estate laws. In these cases, I will find them legal and tax professionals who are fluent in their respective languages. I want them to understand everything about their purchase, and go into it with clear and open eyes.
4. Don’t assume sellers are desperate or in mourning: This is a common and fatal mistake, one I deal with far too often. Sometimes, media reports about the Miami condo market can be overwhelmingly negative, and buyers start to dangerously overplay their hands.
While this may be a buyer’s market, it does not make for easy pickings, and I find that most sellers are actually waking up from their time in “la-la land” and pricing their units more competitively. Also, low-ball offers can genuinely insult sellers, causing the buyer to miss out on great opportunities.
5. Listen to your Realtor — not to third-party websites: I am not an agent who totally dismisses the popular online home finders or value estimators. These services have their place, and in certain cases, may be useful in getting a very rough idea of a particular home’s value.
But working Realtors like myself are actual human beings who live in the real world and can take into account factors (market pressures, property upgrades or damages, buyer/seller motivation, and recent comps of nearby residences) that are simply unknowable to these services. In fact, working in a unique market like Miami, we also have to consider factors such as global politics, shifting currency rates, insurance issues and developer reputations when weighing a property’s market value.
It’s difficult to predict exactly where the condo market will be in the next six to 12 months; there are simply too many dynamic local and global influences at play. However, veteran agents have lived and succeeded through volatile cycles many times and should be able to advise their clients with patience, wisdom and confidence in the future.