MIAMI (CBS4) – It’s the biggest purchase most of us will ever make in our life; the purchase of a home.
JoLinda Herring is excited about it.
“Downtown Miami has had a resurgence. It’s a great place,” she told CBS4’s David Sutta.
The attorney is looking to finally stop renting in downtown Miami. She wants to settle into a condo of her own, right on Brickell if she can get her way. But just months into her search though, it hasn’t been easy.
“I may end up having to go as far as Aventura. Not necessarily ideal, but I have had to wrap my mind around something different. New experiences,” Herring said.
Some may find it hard to believe, but the 22,000 empty units that once flooded Downtown Miami six years ago are now practically gone.
“What we are finding is that there are way too many buyers and not enough units, believe it or not, that are really available for sale,” Peter Zalewski of CondoVultures.com told CBS4. “And the units that are for sale, the prices are high and as the offers are coming in; the prices are going higher.”
More often than not the deals that are closing are all cash deals.
“Cash is no longer king. Cash is a requirement today,” Zalewski explained.
Herring is in trouble competing with that.
“I don’t think I would ever just go pay cash for a condo. I’m just not that kind of person. That doesn’t make financial sense to me,” Herring said.
It doesn’t make sense to a lot of people, but that is what many buyers are up against. Zalewski found in a recent review on condo purchases just one of ten sales involve a homestead exemption. The property tax benefit can only be used by homeowners who use the property as a primary residence.
In other words nine out of ten condo sales involve someone buying as a second home, investment, or rental property.
At the bottom of the downtown market in 2009 you could buy a 1,000 square foot condo for roughly $250,000. Today, that same condo is going $400,000 grand. That is a 60% markup in just four years.
Zalewski said we are seeing the beginning of a boom.
“Ultimately we are beginning the cycle all over again. I’ll tell you if you would compare this to a party. The setup staff is coming in. The speakers are being setup. The DJ is being brought in. The caterers are starting to arrive. And we are getting ready to party and 2014 is probably going to feel very reminiscent of anybody who was down here during the last boom and ultimately bust,” he said.
Herring hopes she’ll get in before the party starts.
“I think I may be able to own a place. I may just have to regroup though in terms of I may not get exactly what I want,” she said.