South Beach area of Miami Beach has 18-year inventory of new condos
Nearly 18 years worth of new condo inventory was sitting on the active sale market in South Beach, Fla., on Sept. 30, as sales in the third quarter were virtually nonexistent. According to third-quarter data released by real estate consultant CondoVultures, only 19 new condo units were purchased and 1,300 were left unsold in the 24-block tip of Miami Beach known as South Beach. More than 23% of the 5,600 condos created since 2003 remain unsold, CondoVultures said. Right now, about six new condos are selling per month in South Beach. Year-to-date, 110 new condos have been sold. CondoVultures found that 18 of the 37 condominiums built during the housing boom in South Beach sold out while six attained an occupancy rate between 65% and 90%. Of the remaining 13 newly created condos with unsold developer units, 11 buildings sold less than 10% of their overall inventory. The other two buildings sold 22% and 37% of their units, respectively. Condos are currently selling for above average prices — about $1,500 per square foot compared to $355 per square foot in downtown Miami, the report said. Sales may be stymied by developers unwilling to reduce their prices, CondoVultures suggested. "South Beach is an international destination with world-class beaches, beautiful people, and a legendary nightlife that attracts visitors from around the world who are increasingly bringing strong foreign currencies," said Peter Zalewski, principal at CondoVultures. "Developers and lenders are well aware of South Beach's unique characteristics and future potential, and have therefore been unwilling to reduce the pricing significantly." Write to Christine Ricciardi.