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In these 20 years working in the Florida real estate market, I have been able to experience different economic cycles and follow the evolution of different neighborhoods and communities in the region. Throughout this period I have identified some determining factors that make a property purchase a success investment in Miami. In this article we explain in detail some of these factors.
See below 7 characteristics that a property needs to have to be a good investment in Miami:
1- Liquidity: Always think about the day of the sale
One of the main characteristics of an investment is liquidity. There is no point in having a valuable asset if you cannot sell it. Low liquidity will force you to depreciate the value of the property to offer it in the market.
Although return on investment (ROI) may not be your main reason to buy real estate in Miami, you should consider it an investment. Your priorities may be different, like having a second home or to live in Miami. However, there is a possibility that one day you will need to sell it. And it is at this point that you will understand why you should have guided your purchase decisions considering the property as an investment.
Always ask the following question: “In a time of need, can I sell this property fast?”
2 – Stay away from “generic products”
A generic product or generic property is one similar to the vast majority. The generic property does not have a unique feature or expressive differential, such as a great location, a beautiful view of the city or the ocean, a corner positioning, high floor, among others.
It is impressive the number of high standard apartments in Miami that are offered on the market as exclusive when, in fact, they are similar to most in their surroundings (in the building, condominium or neighborhood).
Generic properties tend to appreciate less over time. They may even have some liquidity in a heated economic context. However, they will be the first to suffer or “run aground” in times of crisis, since many of them will be offered for sale simultaneously on the market.
Within the same building look for those units that offer differentiated plants or that are “corner” (corner), the best view, high floors, etc.
Properties with unique characteristics tend to increase in value over time and offer better liquidity. They are rare units and, therefore, more desired.
Always ask the following questions:
1 – How many properties similar to this one (with the same characteristics) are there in this building, condominium or neighborhood?
2 – What makes this property exclusive or different from most?
4 – Condo Amenities
The new condos in Miami are famous the world over for the extraordinary amenities and infrastructure they offer to their residents. Some have revolutionized the real estate market with services hitherto seen as impossible. This is the case of the Porsche Design Tower condo, which allows the resident to park the car inside the apartment, thanks to a high-tech car lift.
How about playing bowling without leaving the building? Or ice skating? These are just a few of the amenities offered in luxury condos in Miami.
It is important to take these characteristics into account. At the time of sale, the buyer will make a comparison between the various condominiums in the region.
Always ask the following question:
1 – What services and amenities does this condominium offer, compared to others in the region?
2 – Do other similar condominiums on the street or neighborhood offer better plants or lines?
5 – Attention to the plans of the units and faces (lines) of the building
In Brazil, we are used to the expression “building faces”. We base our decisions, for example, on the “North Face” or “South Face”, with more or less exposure to the sun. In Miami it is not much different, but the concept is a little broader, since many condominiums have several “faces” or “lines”. In addition, sunshine and clarity in Florida abound. It is necessary to check other factors as well.
The lines of a building in Miami are the vertical rows of units, whose numbers are identified by the terminations 1, 2, 3, etc. It is very common, in new Miami buildings, that the units of one line have considerably different plans from another line. The same building, therefore, can offer several options of plans and lengths for its units. The positioning of the different lines on the facade of the buildings also directly impacts the view of the units.
This information is very important, as there is no point in selecting a building in Miami due to its proximity and presence of the ocean, with its wonderful views of the sea, if the acquired unit is on a line whose view of the sea is blocked.
Remember: It is better to buy in the best line of the second best condominium in the neighborhood, than in the worst line of the best condominium.
Always ask the following questions:
1 – What is the best plan and line of this building?
2 – Do other similar condominiums on the street or neighborhood offer better plants or lines?
6 – Beware of changes in the surroundings
As we mentioned in the previous topic, the choice of property in Miami is often strongly influenced by the view it offers, be it the sea, the wonderful channels of Miami or the so-called “Miami Skyline” (urban skyline of the city).
It is extremely unpleasant and depreciating for the property when the view suddenly becomes obstructed by a new construction on the side or in front of the condominium. And this is very common!
This is why high-floor units and walk-in-sand condos are the most expensive in Miami. This property profile tends to value more than the average.
High floors minimize the chances of new construction obstructing the existing view. Condominiums facing the sea, walking in the sand, also do not suffer from this disease, since no new buildings will be built in the front.
It is important to assess whether there is idle land around the condominium and the chances of a new tower being erected in the near future, which may obstruct the view from your floor or bring about inconvenient changes to the region. If there is land next to the chosen condominium, evaluate the retreat of the building in question to the land. Larger indentations minimize the risk of obstructing the view.
7 – Choosing the neighborhood
We often read generic news about the Miami real estate market, giving an opinion on whether or not it is a good time to buy or sell. The truth is that Miami is extremely heterogeneous. What is valid for one neighborhood is not valid for the other. In one region the market may be heated, while in another it may not. Everything must be analyzed based on statistical data from that specific region.
While in one neighborhood the inventory of properties for sale may be high, in others there is a shortage. Opportunities exist in several Miami neighborhoods, but they need to be evaluated very well.
Choose an experienced broker
Choose a broker with experience in Miami. An experienced broker knows what features a property needs to have to be a good investment in Florida. This does not mean knowing only the regions and condominiums, but also having knowledge about the main construction companies, the quality of their projects, punctuality in the delivery of properties, etc. A good broker has traffic with the main developers and access to the main information on the construction market.
An experienced broker will also be able to inform you of important details such as maintenance costs for the various condominiums, restrictions in the statutes of the buildings, management efficiency and financial health, rental rules, rules about guests, condominium value consistent with the services and amenities that he offers, among other information.
Choose a broker who has the knowledge and experience to investigate all of this information and make a solid investment in Florida.
