Real Estate News

Hialeah is hot. Key Biscayne is not. Here’s where Miami property values stand in 2019

According to the Miami-Dade County Property Appraiser, taxable values in the downtown area rose in 2019 primarily due to new construction.
According to the Miami-Dade County Property Appraiser, taxable values in the downtown area rose in 2019 primarily due to new construction. pportal@miamiherald.com

The glitzy skyscrapers and downtown skylines get all the postcards and travel brochures.

But it’s the middle-class residential neighborhoods that are currently driving up Miami-Dade real estate, according to the 2019 preliminary report of taxable values released Friday by the Miami-Dade County Property Appraiser.

Overall, county-wide taxable values went up from $288.8 billion in 2018 to $307.2 billion in 2019, a 5.9 percent increase.

Without counting new construction, taxable values rose from $283.1 billion to $300 billion, a 3.4 percent rise.

The preliminary countywide growth estimate hit Miami-Dade’s property-tax forecast for the 2020 budget year, which begins Oct. 1. The county was counting on a 5.5 percent growth rate, and received no fiscal breathing room from the early numbers.

Past years had exceeded forecasts, triggering automatic union raises tied to surging property values.

The areas outside of city limits that rely on the county for municipal services, such as police and trash pick-up, fared far better than urban areas. The “Unincorporated Municipal Services Area,” which accounts for about one out of every two homes in Miami-Dade, saw its tax base soar by 6.4 percent, well above the county’s four percent forecast.

But Deputy Property Appraiser Lazaro Solis said the percentages alone don’t tell the whole story.

“When you’re dealing with these kinds of numbers, you need to look at the actual differences,” he said. “The estimated taxable values grew by $17 billion from 2018 to 2019. I doubt any other county in the state came close to that.”

Residential areas that showed the biggest gains on existing properties from their 2018 values include Opa-locka (8.3 percent), Hialeah Gardens (7.3 percent), Miami Gardens (6.7 percent), Hialeah (6.7 percent), Miami Shores (6.1 percent), Homestead (6 percent), North Miami (5.6 percent), North Miami Beach (5.5 percent) and Cutler Bay (5.2 percent).

Those gains were even higher after factoring in new construction. Opa-locka, for example, jumped 29.8 percent, and North Miami Beach grew by 15.8 percent.

Almost all of the neighborhoods where values rose the most have median home sales prices between $200,000-$300,000, according to Zillow. A noticeable exception is Miami Shores, with a median home sales price of $441,800.

“It makes sense that most of the areas where values went up the most have middle-priced homes,” said Miami-Dade Property Appraiser Pedro J. Garcia. “And with areas like Opa-locka [where Amazon built an 885,000-square foot fulfillment center last year], the new construction had a big impact on values.”

Areas where existing values fell were luxury or pricey enclaves, such as Sunny Isles Beach (a drop of 4.4 percent), Key Biscayne (a drop of 3 percent), Aventura (a drop of 0.3 percent) and Bal Harbour (a drop of 0.2 percent).

Most of those drops were offset by new construction, although some areas still ended with negative values, such as Key Biscayne with a -2.8 percent change from 2018.

“The problem with Key Biscayne is that they don’t have enough land there to build anything new,” Garcia said. “People will demolish their old house and build a bigger one, but you can’t really build much more than that.”

Even the Miami Downtown area, which stretches north from Brickell to Edgewater, suffered from stagnant existing values, with only a 1.8 increase over 2018. With the addition of $1.26 billion in new construction, the area’s value rose 8.3 percent over 2018.

Solis said that the downtown district includes a lot of old buildings with high levels of depreciation.

“A lot of those buildings are currently closed,” he said. “New construction is what gives the downtown district its life.”

The preliminary report released Friday is used by local governments to forecast how much property-tax revenue they can expect to generate within their jurisdictions, but Garcia stressed the numbers are subject to change.

A second report, due July 1, will provide the final values that will be used to generate 2019 tax bills.

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Rene Rodriguez has worked at the Miami Herald in a variety of roles since 1989. He currently writes for the business desk covering real estate and the city’s affordability crisis.

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