Florida Market Insight: Current market conditions in Florida’s luxury residential sector.
Douglas Elliman and Knight Frank have just released our Florida Market Insight report. Here are the key takeaways:
• South Florida is the top destination for overseas buyers in the US, accounting for 23% of foreign purchases in 2022. Foreign driver license exchanges have increased by 78% in the year to date, with 24% coming from New York, 10% from New Jersey, and 8% from California. Feeder states like Texas, Georgia, Virginia, Maryland, and Ohio are also increasing their market share.
• Cash buyers dominate SouthEast Florida's $1 million-plus sales, with Palm Beach's condo and townhouse market accounting for 84% of sales in August 2023. Rising mortgage rates and sustained migration from asset and income-rich buyers contribute to this growth.
• The market is divided by price bands and location, with higher mortgage costs causing homeowners under $1 million to stay or rent, reducing property sales.
• Single-family homes priced above $1 million-plus in Miami-Dade County and Palm Beach made up 20% and 21% of sales in August 2023, respectively. However, desirable suburbs like Palm Beach are experiencing tight inventory levels. Broward County, home to Fort Lauderdale, saw the largest decline in listings, down 9% overall.
• Florida's low corporate tax rate of 5.5% has attracted major tech, finance, and legal sectors like Citadel, Microsoft, Blackstone, and Goldman Sachs, with Citadel relocating its headquarters to Florida in June 2022, and Jeff Bezos pursuing Miami for space exploration.
• Miami is emerging as the sports capital of the world, with Lionel Messi joining Inter Miami. The city already hosts a Formula 1 circuit, Miami Open Tennis, and key basketball and hockey franchises. Fifa is looking to lease offices in Coral Gables for the 2026 World Cup. Sports tourism will become more important to Miami's economy, with residential developments offering top-notch sporting facilities.
• Florida's low tax and lifestyle benefits are under scrutiny as global policymakers raise taxes to address deficits. US households have amassed more savings than previously thought, with over half held by the top 10%. However, Florida faces economic and climate challenges, with oil prices potentially rising and rising sea levels.
To read the complete report, click this link: Florida Market Insights