Real estate, more than many, is a business of trends and being able to tap into the changing whims and demographics of a clientele. Being successful in luxury real estate means integrating well with the trends of wealthy clients, looking for the latest in high-end home trends. Exploring the trends of the Miami Beach luxury real estate market shows that despite the surging areas of Brickell, Bal Habour and Surfside, Miami Beach remains the hottest and trendiest neighborhood in the Miami-Dade area. Here are the other significant trends from this high-end market.
Best Luxury Real Estate Market in the World?
According to a recent study from research firm Bendixen & Amandi International, the majority of agents and brokers feel that the luxury real estate market in Miami Beach is still offering a good value, even with the impressive price tags, with 52% of brokers and agents surveyed finding the current inventory a good value. However, the percentage of agents who called the market overvalued dip jump up from the year prior, indicating that perhaps the value is starting to switch. The inventory and value is currently buoyed by continued development and construction in the Miami Beach market. In fact, this market makes the luxury inventory in Miami-Dade arguably one of the finest in the world.
Tax Plan Brings In Buyers
Back in 2017, the United States tax code underwent a reform. Among other items, the tax plan created a cap of $10,000 of local and state taxes that filers could claim and deduct on their federal tax returns. Since luxury real estate buyers are more likely to be affected by this cap, the Miami Beach market has seen an influx of potential buyers from other states. This is particularly potent because buyers are coming in from higher-tax areas like New York and into the state and local tax-free area of Miami-Dade. While this impacts the entire Miami-Dade area, Miami Beach has seen a major impact, with the majority of purchasers from this demographic being single-family homes in the state’s hottest market.
Larger Homes Trumping Condo Purchases
Bolstered by the out-of-town, tax-incentivized buyers, a lot of the action is coming on larger, single-family homes. The fastest-moving inventory in the luxury market has been in homes over 10,000 feet, making up about 70% of the high-end home sales. Of these sales, the vast majority have been in brand-new construction homes with a modern style. This makes the development of these properties a lucrative area right now, and there isn’t an end in sight. The luxury condo market, while not the majority, is far from stagnant. Buyers interested in the smaller living space properties have been making up for it with a focus on unbeatable location. New construction is still highly valued, but condo buyers are very much focusing on beachfront property. Inventory in this space is fairly limited, but it is moving quickly, with high price tags.
The luxury real estate market is still a booming sector in the overall landscape of Miami-Dade. With that boom, plenty of markets are on the rise. However, the king remains the Miami Beach luxury real estate market, one of the finest major markets anywhere in the world. Driven by a rush of buyers from high tax areas, the real estate market is incredibly strong. This is driving prices up, and while most brokers still feel that the prices, even in the luxury sector, are a value, it is possible this is starting to turn. However, the time is still ripe for buyers to capitalize on value, and sellers can benefit from a short inventory with high demand in 2019.