Miami-Dade’s real estate market saw growth slow to 5 percent at the start of 2017, but more than $8 billion in new construction should provide local governments some breathing room at budget time.
The 5 percent gain for existing properties in Miami-Dade is less than the 6.9 percent growth a year ago. But if that deceleration reflects a broader cooling of the housing market, the new numbers from the Property Appraiser Office capture a building boom that helped define real estate in 2016. With $8 billion in new construction for the year — roughly $22 million built every day — the county’s overall tax base grew by 8.2 percent.
We are starting to see a relative weakness in the market, especially with condominium properties.
Miami-Dade property appraiser
“New construction continues to drive growth in taxable value countywide,” Pedro Garcia, county property appraiser, said in a statement. But with gains slowing on existing properties, Garcia suggested next year’s report might not be as encouraging for local sellers and government budget writers.
“We are starting to see a relative weakness in the market,” Garcia said, “especially with condominium properties.”
Broward County saw rosier numbers, with existing values up 7.9 percent at the start of 2017. New construction boosted that gain to 9.3 percent. That’s better than last year’s gain of 7.1 percent for existing properties. Overall growth for Broward was 8.5 percent at the start of 2016, thanks to a slightly smaller wave of new construction in 2015.
“It’s really looking up,” Broward property appraiser Marty Kiar said Wednesday. “People are buying and selling real estate. We’ve seen lots of new construction.”
The annual tax-roll reports are closely watched by municipal budget writers, since they often determine how much revenue governments can count on from property taxes. Elected leaders are free to adjust rates, but a bump in values typically means extra money without the politically bruising task of having to raise rates.
It’s really looking up. People are buying and selling real estate. We’ve seen lots of new construction.
Broward property appraiser
In Miami-Dade, home to the largest local government in Florida, the 2017 budget forecast called for the countywide tax roll to grow by 6.5 percent. With the preliminary total hitting 8.2 percent, the results should provide some relief during a year when sales taxes are trailing forecasts amid a tourism slump. A final report that will be used for budgeting purposes is expected July 1.
State law limits tax increases for property owners, particularly for a primary residence. Higher values can only boost a primary residence’s tax bill by up to 3 percent or the rate of inflation, whichever is lower. Recent years saw inflation below 1 percent, but rising prices have boosted the cap to 2.1 percent for 2017 tax bills, according to the Florida Department of Revenue. That’s the highest since 2012, when the inflation rate hit the ceiling of 3 percent.
Some highlights from the latest tax-roll numbers include:
In Miami-Dade, property values soared the most in Bay Harbor Islands. The tony cluster of islands off Biscayne Bay saw values on existing properties increase 15.4 percent as of Jan. 1, 2017. In Broward, the first-place slot went to West Park, with an 11.4 percent increase.
Miami saw $2.8 billion in new construction alone. That was given a significant boost by the opening of the new Brickell City Center, which is valued at over $1 billion, according to Garcia’s office. In Broward, a new Florida Power and Light plant in Hollywood helped add about $942 million in new construction to that city’s tax rolls. That was the largest in the county.
One of the smallest cities in Miami-Dade enjoyed the biggest surge in property values. West Miami, which has one of the five smallest tax bases in the county, saw values surge 28 percent. That was thanks to existing property growing by 13 percent and $55 million in new construction. The weakest performance in Miami-Dade came from Florida City, which saw total gains of just 1 percent.
In Broward, the top performer was Dania Beach, where overall values soared 20 percent. The weakest performer: Pembroke Park, which still managed to post an overall gain of 5.2 percent.