MIAMI, FL--Only 13 percent of the more than 43,200 South Florida coastal condo units created and sold since the real estate boom began in 2003 are owned by primary users who have filed for tax savings and added property protection under the state’s Homestead Exemption legislation, according to a new report from CondoVultures.com.
The percentage of primary users could move even lower as investors and second-home buyers – who do not typically qualify for Homestead Exemption benefits – are the suitors most likely to acquire a majority of South Florida's 5,400 unsold developer units near the coast as of the second quarter of 2011, according to an analysis based on the Sept. 29, 2011 report from the Condo Ratings Agency™.
“Analysts have long suspected that investors and second-home buyers are driving the current trends in the South Florida condo market,” said Peter Zalewski (lower left photo), a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures® LLC.
“This report finds that primary users account for only about one out of every 10 condo transactions in a new project in South Florida’s seven largest coastal markets.
“Foreign investors with strong currencies and domestic second-home buyers are clearly the lifeblood of the South Florida coastal condo market right now from Greater Downtown Miami north to Downtown Fort Lauderdale up to Downtown West Palm Beach.
“Given the report’s findings, it is quite possible that a majority of the coastal condos built during the South Florida real estate boom are now being occupied by renters.”
Determining the ratio of renters versus primary users – a key criterion for conventional financing - in a condo project is a challenging task as no formal paperwork is required to be filed with an independent third party or the government, according to a new CondoVultures.com report.
Peter Zalewski of Condo Vultures® can be reached at 800-750-0517 or by email at peter@condovultures.com
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