Foreign Investors Kings of Miami Housing Boom
Several news outlets have already picked up the recent trend in Miami’s housing market. That is, valuation has gone up since last year prompting a surge of investors buying homes in the city’s depressed areas, generally diversifying their portfolio and devising ways to turn a profit.
Regardless, news of Miami’s housing boom has certainly garnered enough attention especially with Latin American investors who are snatching up condominiums with the plans of renting it out. As a result, more and more developers have taken up arms and building new projects to counter the surfeit of demand. The question remains, however, will this turn out to be good for the city or not?
No matter where one looks at it, the recent uptick in home values may seem a sign of recovery. Indeed, as the 2006 real estate bubble would suggest, the increase in property values enables more homeowners to take advantage of the opportunity to build equity and eventually lower or come up to speed with their monthly payments. On the other side of things, however, unemployment rates at the city is at a dismal 9.9 percent since November of 2011, number so great in its nightmarish appeal that many are now questioning the benefits of the current deluge of residential properties.
To wit, the demand for office spaces is weak. In whatever angle one views this fact, one thing surely comes up: It is that this lack of need for office spaces reflects the current unfortunate jobless atmosphere of the city. It now seems that the future of these soon-to-be-rented out properties, especially as many investors are planning to offer them to “young professionals”, who are indeed a rarity in the city, becomes uncomfortably nebulous. And this might turn again into what many experts are seeing as another bubble. Although developers are seeing a strong need for luxury retail and shopping, it will only be a matter of time before such demand can generate enough jobs to create a solid foundation for the quickly recovering residential real estate market.