The city of Miami Beach epitomizes the active and bustling lifestyle of South Florida, with its healthy mix of sun, sand, charming people, partying, and a wonderful variety of outdoor and water sports activities.
The city, which is located across Biscayne Bay from Miami, is a thriving island city complete with local government, police and fire departments, hospitals, shops, parks, and marinas. Most of the real estate in Miami Beach consists of expensive single-family homes and estates on the west side and luxury condominium and apartment units on the east side. The economic fundamentals of the city are solid, with tourism and real estate development as the main engines driving the current boom in the area.
Current Home Prices in Miami Beach
Despite the slowdown caused by the ongoing US housing and credit crisis, the overall trend for Miami Beach real estate has been relatively stable and prices have not shot up much above or much below the index. half.
Currently, the owner-occupied single-family home market has a median value of $334,400 compared to $119,600 for the US as a whole. Owner median monthly rates are set at $2,555 with a mortgage, or $878 without a mortgage. The median requesting vacant homes and condos for sale, as of 2005, is $328,300. On the other hand, median rental rates per contract, as of 2005, are $764. The biggest driving force behind Miami Beach’s growth is the tourism market, which generates billions in revenue, drives new construction of hotels, condominiums and apartments.
Tourists from far and wide flock to its picturesque beaches and lively nightlife, most of whom hail from Europe, South America, and East Asia. The area has been dubbed the New Manhattan by the US real estate media, and the Greater Miami Association of Realtors estimates that the Miami Beach real estate boom will lead to the construction of more than 100,000 new homes. Most real estate developments are currently being swallowed up by foreign buyers.
The US real estate crisis and its effect on the local market
As the US subprime credit market reels from a deluge of bad loans and unpaid mortgages, real estate trends in Miami have also suffered a bit, with home prices tumbling. Local realtors, who have sold Miami properties for decades, say buyers today are shying away from condo and apartment auctions, anticipating what will happen next and adopting a wait-and-see attitude. Yet despite the jitters being felt by buyers and sellers, developers aren’t slowing down on their new construction of more condos and housing units.
The US Federal Reserve’s vote to cut key interest rates by half a percentage point is intended to keep the economy growing despite the downward trend in credit markets. The Fed’s decision to cut the federal funds rate has had a positive impact on Wall Street and boosted stock prices, although analysts expect this move to take some time to stimulate the embattled housing industry. Miami Beach real estate developers and brokers are optimistic that the Fed’s move would provide a measurable improvement in the currently sluggish real estate market.
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