Compass dealer affiliate Scott Diffenderfer and BH Group head of acquisitions Alex Tukh communicate to Fox Information Digital about why South Florida’s older condos are at the moment promoting quicker than newer models.
Condos constructed greater than 30 years in the past have gotten a number of the hottest properties in South Florida, with latest information displaying they’re promoting quicker than newer models — usually for lower than half the value.
“I believe these previous condos are going to be like basic automobiles,” Miami-based Compass dealer affiliate Scott Diffenderfer informed Fox Information Digital. “There’s just a few those that choose them. They’ve much more appeal to some individuals, a few of them have nice layouts and nice closets, and issues which can be far more costly in new condos.”
“Persons are in search of affordability,” BH Group’s head of acquisitions Alex Tukh additionally informed Fox Information Digital, “and the resales, usually, are cheaper in the identical places as new developments, so it is an affordability concern.”
A July report from Miami REALTORS discovered that Miami-Dade condos in buildings 30 years or older are spending much less time in the marketplace than these in buildings 29 years or youthful — 62 days in comparison with 79.
IS A FLORIDA CONDO CRISIS BREWING? DEVELOPERS CLAIM RISING COSTS ARE NECESSARY TO PREVENT DISASTER
The development is tied to affordability pressures, new rules and redevelopment alternatives, in keeping with Diffenderfer – who focuses on older condominium gross sales – and Tukh, whose agency is main redevelopment of older condos into luxurious initiatives.
Condominium building is proven in Miami’s Brickell Monetary District. (Getty Photos)
“Persons are changing into very snug with the brand new legislation that went into impact in January requiring older buildings to restore and preserve their constructions,” Diffenderfer stated, referring to the so-called Condominium 3.0 invoice.
The legislation adopted the June 2021 collapse of the Champlain Towers South condominium in Surfside, Florida, which killed 98 individuals and prompted sweeping modifications to the state’s condominium security guidelines. Federal and state investigators later decided the tragedy stemmed from critical structural deficiencies, particularly within the pool deck, the place concrete was insufficient and reinforcing metal had corroded.
“The value of latest building and new buildings is a lot greater than older buildings that… the market is talking and lots of people cannot afford these new buildings,” he continued. “In Miami-Dade County, the latest common sale value of a 1,300 sq. foot, two-bedroom, two-bath condominium in a constructing lower than 10 years previous is $1.15 million… The identical [in an] older constructing… is $505,000. So you’ll be able to see it’s lower than half.”
Gutman Growth Advertising and marketing’s Phil Gutman, The Continuum Firm’s Ian Bruce Eichner and BH Group CEO Isaac Toledano clarify to Fox Information Digital why they help Florida’s ‘Condominium 3.0’ invoice.
Renovations additionally issue into the worth of older condos: “For those who purchase a $700,000 condominium and you place $300,000 into it, you’re nonetheless at 1,000,000 {dollars} versus $2.5 million for brand spanking new building of the identical dimension condominium in Miami Seashore.”
BH Group, then again, has been working to scoop up older buildings for eventual demolition for brand spanking new luxurious builds. Within the developer’s view, older condos entice traders when contemplating market demand and land shortage.
“Any funding we take a look at, we begin with location,” Tukh stated. “And loads of these older condos are in prime places. There’s no extra land, essentially, in these prime markets. So now we have to look [for] different methods to create further worth in these markets, and redevelopment is one among them.”
Miami Seashore, Florida, in an aerial view, with Collins Avenue, Indian Creek Imperial Home Condominium constructing and The Alexander Oceanfront Resort. | Getty Photos
“Redevelopment is an possibility, particularly when it isn’t possible to proceed to attempt to preserve property that is functionally obsolescent or simply would not have the density that the brand new zoning permits… Undoubtedly, the brand new rules do have an effect for the homeowners and boards of the older communities, and it might be a win-win for everybody concerned. It would not simply should be for the developer, play. The homeowners of those older condominiums can get some reduction on upkeep and in addition can have, you realize, an honest payday as properly.”
DOZENS OF LUXURY HIGH-RISE BUILDINGS IN SOUTH FLORIDA ARE SINKING
Tukh additionally pushed again on any criticism about older condominium resident displacement and affordability throughout the Sunshine State’s southeast.
“Florida, South Florida, it is nonetheless inexpensive,” he argued. “Chances are you’ll not get ocean fronts, however you’ll be able to nonetheless get a good-quality neighborhood, protected, good colleges. Florida has many issues going for it: security, pro-business, no state revenue tax… There’s been loads of inflow of individuals, and it continues.”
South Florida’s condominium market has additionally been fueled by continued migration into the area. Between 2020 and 2024, Florida’s inhabitants grew by roughly 8.2%, the quickest fee within the nation, including almost 1.8 million residents. The Miami–Fort Lauderdale–West Palm Seashore metro space – which incorporates Miami-Dade, Broward and Palm Seashore counties – ranked among the many high three U.S. areas for inhabitants development from 2022 to 2023, pushed largely by worldwide migration, in keeping with U.S. Census information and Miami REALTORS.
Madison Ventures+ managing accomplice Mitch Roschelle reacts to newest developments with the alleged gang-controlled condominium advanced in Colorado and Florida’s condominium market in correction mode.
Diffenderfer goals to bust myths about security round older condos and the No. 1 false impression that they’re a “cash pit.”
“The largest is that it’s a cash pit… proper behind that, although, is security. There’s those that suppose they’re unsafe and you actually have to return and look – just one constructing has collapsed. There are tens of hundreds of condominium buildings in Florida on the water which can be previous, and just one has collapsed,” the Compass agent identified.
He predicts confidence will develop as repairs are accomplished: “This new legislation additionally requires reserves to be put in place in order that these buildings are ready for future repairs. As soon as this preliminary large monetary reckoning occurs, I believe it’s gonna be nice for the market. All buildings will be capable of really feel like they’re protected, that they’re financially steady.”
For consumers, the true property agent holds optimism that older condos characterize affordability and alternative, whereas on the developer’s aspect, they exemplify the way forward for South Florida’s skylines.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
South Florida actual property lawyer Invoice Sklar on a Florida job drive inspecting condominium legal guidelines after the Surfside collapse to find out if modifications are wanted.
“The longer term’s so vibrant, we gotta put on shades proper now,” Diffenderfer famous. “The previous condos, the chance is so superb… As soon as these repairs are performed, it’s gonna be a no brainer and I believe you’re gonna see the worth of older condos come a lot nearer to newer condos.”
“We lately closed on three redevelopments of older condominiums… The longer term appears to be like very vibrant,” Tukh stated. “There’s loads of older associations and co-ops which can be nice targets for redevelopment. So, we’re very bullish in the marketplace.”
