Whether you are an investor that plans to flip Miami apartments, or you are a buyer who wants to use your Miami condo as a primary or secondary home, you need to think about resale value when buying. There are many different kinds of apartments for sale in Miami Florida. There is also a wide divergence between the price of new apartments and the price of resale apartments, with new apartments selling at a premium. In the event that you want to sell your condo, you want to ensure you will be able to command top dollar. You can do this by considering some of the following things before you purchase a Miami apartment.
Location, Location, Location
Regardless of the market, location is always a key factor in resale value of a property, but this is even more relevant when buying luxury condos in Miami. Those who buy luxury properties in Miami are buying a lifestyle that is associated with the beach and the water, so they want to be located as close to the water as possible. Of course, beachfront have the best resale values in the Miami luxury condo market. The next best location would be something with a Biscayne Bay view. Those that have direct water views from the shores of Biscayne Bay or the Atlantic Ocean will often command a higher resale value than buildings located on a canal or creek. This is especially true in the Fort Lauderdale area where canals are abundant.
There are many great waterfront neighborhoods in Miami, some of which are Fisher Island, South Beach, South of Fifth, Coconut Grove, Sunny Isles Beach, Surfside, Bal Harbour, and Key Biscayne.
In the event that you choose to buy a property that isn't on the waterfront in Miami Beach, you should make sure that the property has beach access. Some luxury homes in Miami and Miami Beach that are not located on the water or beach have an arrangement with local companies that provide beach service or boating service. These arrangements increase the resale value at properties that are not located on waterfront or beachfront.
Choose the Right Floor Plan
Different floor plans have different resale values in the Miami condo market. Generally, larger floor plans have the highest resale value. Even those who are single may want to go for a larger size apartment, such as one with an office, den, or guest bedroom, as the demand for pure one-bedroom apartments is lower than larger units. Similarly, there are very few top penthouse apartments South Florida, which keeps the demand higher, even during a downturn in the market. If you want to get top dollar for your Miami apartment at resale, you should consider purchasing the most square footage that your budget allows.
If you are investing in a high-rise condominium building, the floor that your residence is on affect resale value. Typically the higher the floor the better the resale value. Miami residents who live in luxury apartment buildings want the panoramic views of Miami's skyline, Biscayne Bay, and the Atlantic Ocean, which are often unobstructed on higher floors. Even if you purchase a unit on a lower floor that has great views, you run the risk of another developer building something nearby that obstructs the view. This may negatively affect your resale value—you purchased a unit with a great view of Biscayne Bay, but three or four years later residents look at the steel and glass of another building from the terrace.
Time the Market
Much like the general economy, the real estate market goes through boom and bust cycles, where the industry contracts and expands. To get the best resale value for your luxury Miami apartment you need to time the market so you sell at right time; having a real estate agent who is experienced in Miami's luxury market will give you this edge. Your agent will advise you where the market is in the real estate cycle so you are able to resale for the highest price per square foot. The real estate cycle is generally divided into four stages: recovery, expansion, hyper supply, and recession.
If you visualize the real estate cycle as a continuous wave pattern, recovery occurs at the bottom of the trough. During the recovery stage buyers will find bargains everywhere. The industry contracts with developers going out of business and there is little to no new construction because demand is low. Most will not buy during recovery, but astute real estate investors know that this is the time to make money. Those who are selling typically will not get top dollar early in the recovery stage.
During the expansion phase the market grows. The demand for new condos increases as rents increase, leading to new construction. During expansion you will see pre-construction projects. Once again, viewing the real estate as a wave, expansion continues until the peak, or crest, of the wave, where supply and demand are in equilibrium. Sellers will get the best resale value by waiting as long as they can to sell in an expanding real estate market.
Once supply and demand for Miami apartments reaches an equilibrium it may remain stable for awhile, but eventually, the market will begin to constrict. The market is saturated, prices are high, and there are fewer buyers. Sometimes this goes to an excessive level where overbuilding occurs. Eventually the market sinks into a recession.
In this stage, demand for Miami apartments continues to fall and so does pricing. This can be a dangerous time for sellers who wait for things to turn around instead of cutting their losses or riding the entire cycle. When the market hits bottom, the cycle starts over again in recovery.
Use an Experienced Realtor When Buying a Miami Apartment
An experienced real estate agent Miami can guide you in choosing the right location for you. They can also help you determine which floor plan works best for your family. Miami real estate brokers are a valuable resource when inventory for sale is very high. A skilled broker or agent understands the real estate cycle broadly and is experienced with the Miami market, but he or she also understands each sub-market, such as the inventory of Miami beach apartments for sale compared to Miami luxury condos for sale. We have in depth knowledge about developers and specific buildings. We know which ones have delivered the best product to the market and know which ones have fallen short. This nuanced understanding of the market can only be attained with experience. Further, it is often difficult to tell when the market is recovering. A good agent will guide you on when the timing is right for you to sell your Miami apartment so you get the best resale value.
And, remember, in the United States, and in Miami Dade county in particular, buyers pay nothing to have representation, as the seller will pay the broker commission in all transactions.
Contact us for your questions and inquiries about buying or selling a luxury Miami apartment.