Bulk Buyers Resell 3,250 Condos At 21% Premium In South Florida Since Bust

Bulk buyers have resold about 64 percent of the nearly 5,100 condo units originally acquired in distressed transactions of 10 units or more in South Florida’s seven largest coastal markets during the heart of the real estate crash, according to a new report from CondoVultures.com.

As of March 31, 2012, bulk owners have retraded nearly 3,250 condo units near the coast in the tricounty South Florida region of Miami-Dade, Broward, and Palm Beach at an average price of $340 per square foot, representing about a 21 percent premium compared to the average bulk condo purchase price of $282 per square foot, according to an analysis based on the Condo Vultures® Bulk Deals Database™.

“The impact of the bulk buyers – spending more than $1.7 billion – has been vital to the stabilization of South Florida’s coastal condo markets,” said Peter Zalewski, a principal with the Greater Downtown Miami-based real estate consultancy Condo Vultures® LLC. “Bulk buyers – initially from abroad but more domestic in recent years – worked to backstop the South Florida coastal condo market by acquiring about 11 percent of the units created and transacted by developers since 2003. As the South Florida coastal condo market has firmed up and showed some price appreciation, bulk buyers have increasingly been reselling their units at a premium to individual buyers.”

As of the first quarter of 2012, bulk buyers still own more than 1,800 new condo units – acquired primarily between late 2008 and early 2011 – in South Florida’s seven largest coastal markets of Greater Downtown Miami, South Beach, Sunny Isles Beach, Hollywood / Hallandale Beach, Downtown Fort Lauderdale and the Beach, Boca Raton / Deerfield Beach, and Downtown West Palm Beach and Palm Beach Island, according to the report.

The competition for bulk owners who are attempting to resell their condo units is primarily developers in the neighboring – and in some cases the same – projects with remaining unsold inventory.

As of March 31, 2012, nearly 3,900 new condo units remain unsold from the last real estate boom-and-bust era in South Florida’s seven largest coastal markets, according to a recent CondoVultures.com report.

In the first quarter of 2012, buyers paid more than $320 million – an average of $468 per square foot – for more than 550 condo units in projects in South Florida’s seven largest coastal markets, according to a report based on the Condo Vultures® Buyers Guide™ eBook series.

With the first quarter of 2012 developer sales, buyers – individual and bulk – have now purchased nearly 45,000 condo units for more than $22.1 billion in South Florida’s seven largest coast markets between 2003 and the first quarter of 2012, according to an analysis of Clerk of the Court records from Miami-Dade, Broward, and Palm Beach counties.

In anticipation of the eventual sellout of the new condos created during the last boom, developers are already proposing at least 45 new condo towers with more than 7,600 units in the coastal South Florida markets, according to the Preconstruction Condo Projects list compiled by the licensed Florida brokerage CVR Realty™.

As of June 27, 2012, at least one new condo tower has been completed and nine more condo towers have begun construction, according to a new CondoVultures.com report.

During the last South Florida real estate boom, developers created 148 projects with more than 34,000 units in the three Miami-Dade County markets of Greater Downtown Miami, South Beach, and Sunny Isles Beach.

An additional 69 projects with nearly 10,200 units were created in two Broward County markets of Hollywood / Hallandale Beach and Downtown Fort Lauderdale and the Beach.

Developers created 28 projects with nearly 4,500 units in the two Palm Beach County markets of Boca Raton / Deerfield Beach and Downtown West Palm Beach and Palm Beach Island.

In the four decades prior to the boom, developers created nearly 700 condominium projects with more than 76,000 units in the same seven coastal markets in South Florida, according to a comprehensive study undertaken for the report based on the Condo Vultures® Buyers Guide™ eBook series.

It is important to note there are various stages to a residential real estate transaction in South Florida.

A transaction begins when a property is made available for sale and ends when a title is conveyed from one party to another party as a result of the recording of a deed with the local government.

As part of the process, a property typically goes under contract and into a due diligence phase by which a deal can be canceled.

The CondoVultures.com new condo sales report is based on completed transactions where a deed is recorded and taxes paid as a result of the sale.
Condo Vultures® LLC is a real estate consultancy and marketing company based in the 225 Midtown Building at 225 NE 34th St., Suite 209B, Downtown Miami, Florida, 33137. Condo Vultures® LLC can be reached at 800-750-0517.

Don’t forget to sign up for our weekly Market Intelligence Report™ for detailed condo reports to stay informed on the latest market trends and to find out about our various Condo Vultures® Seminars. Looking for a property at a deep discount? Take a peek at the Vultures Database™ or view our Video Library. Looking for bulk projects direct from developers or lenders? Visit the Condo Vultures® Bulk Deals Database™. Our new books, the Official Condo Buyers Guide to Miami™, Official Condo Buyers Guide To South Beach™, Official Condo Buyers Guide to Sunny Isles Beach™, Official Condo Buyers Guide to Downtown Fort Lauderdale and the Beach™, Official Condo Buyers Guide to Hollywood / Hallandale Beach™, Official Condo Buyers Guide to Downtown West Palm Beach™, and Official Condo Buyers Guide to Boca Raton / Deerfield Beach™, are now available. Want to see every foreclosure filed in South Florida since 2007? Check out our Foreclosure Database™.

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