The South Florida luxury condo market is back — and likely even outperforming the last boom a decade ago — in the minds of bullish sellers who are on the lookout for the illusive out-of-town buyers with access to endless amounts of cash.
Nearly 3 percent of the more than 24,350 condos actively for sale in South Florida currently have an asking price of at least $1,000 per square foot in the tri-county region of Miami-Dade, Broward and Palm Beach, according to an analysis of properties listed in the Southeast Florida MLXchange.
In practical terms, this level of pricing means a luxury condo with one bedroom and 1,000 square feet is generally on the market in South Florida for about $1 million.
For every additional bedroom needed in a unit, it is reasonable to expect a floor plan to increase in size by about 250 square feet or $250,000.
If this price range is not exclusive enough, nearly three dozen luxury units in South Florida have an asking price of more than $3,000 per square foot. Of these units, about four condos have an asking price of at least $5,000 per square foot.
As impressive as these prices are in South Florida, the most expensive condo — a four-bedroom unit in the Setai Resort & Residences in the 2000 block of Collins Avenue in South Beach — on the market today is for sale at a price of about $8,200 per square foot for a total of $18.9 million, according to the data.
Not to be outdone by existing units, a pair of proposed condos is competing for the distinction of having the biggest asking price in total dollars in South Florida.
A proposed six-bedroom penthouse with 16,000 square feet of living area in the new Mansions At Acqualina condo tower being constructed in the 17700 block of Collins Avenue in Sunny Isles Beach has a price tag of $55 million for an average of nearly $3,450 per square foot, according to the data.
Following in a close second in the rankings is a proposed four-bedroom penthouse with less than 8,300 square feet in the planned Faena House tower being constructed in the 3300 block of Collins Avenue just north of South Beach. The price tag for this unit is $50 million, or an average of nearly $6,050 per square foot, according to the data.
Sellers and developers can obviously seek whatever prices they desire for their existing and proposed South Florida condos but quickly realize there are no guarantees buyers will ultimately pay these arbitrary amounts.
A review of recent condo sales statistics suggests a growing disparity between increasingly sticker-shocked buyers and optimistic sellers in South Florida.
As of Feb. 19, sellers are offering more than 625 luxury condos with 1.7 million square feet of saleable space in South Florida at an average price of more than $1,680 per square foot, according to the data. By these numbers, the total sellout price for the current luxury condo inventory in South Florida is $2.9 billion, according to the data.
For comparison, buyers purchased less than 220 luxury condos units with about 540,000 square feet of saleable space in South Florida for an average price of less than $1,475 per square foot in 2013, according to the data.
The luxury condos that traded in 2013 sold for $792.8 million, down 13 percent from the original asking price of $912.2 million, according to the data.
Drilling deeper into the 2013 luxury condo sales data, it becomes obvious that a supermajority — nearly 195 units — of the luxury condo sales transacted at an average price of between $1,000 and $2,000 per square foot in South Florida.
Less than 30 luxury condos traded for an average price of between $2,000 and $3,000 per square foot. About six luxury condos sold for an average price of between $3,000 and $4,000 square foot in 2013, according to the data.
Based on the 2013 luxury sales pace of about 18 units trading monthly, the South Florida condo market has nearly three years — about 34 months — of inventory available for purchase, according to the data.
Generally, a healthy condo market has about six months of inventory available for purchase. Any less condo inventory suggests a seller’s market while any more supply indicates a buyer’s market, industry watchers said.
The question going forward in South Florida is whether buyers will be convinced by the overwhelming confidence being displayed by bullish condo owners and developers who are seeking top dollar for their units scattered throughout the tricounty South Florida region.
Peter Zalewski is a principal with the Miami real estate consultancy Condo Vultures. Zalewski also runs the preconstruction condo project website CraneSpotters.com in conjunction with the Miami Association Of Realtors.