Those seeking a juicy return on a new condo flip, beware, as Miami’s pre-construction condo resale market is experiencing distress, notes Andrew Stearns, founder and CEO of StatFunding.com.
"With more than 700 units listed for sale, a total of eight resales of year 2012-2016 vintage condos closed in August (17 projects included in the review)," Stearns says. "Sellers suffered losses on seven out of eight resales (87.5%)."
"If pre-construction developer fees, association contributions, and other actual costs are included in the analysis for each resale, then 100 percent of resellers of Miami pre-construction condos in August 2016 lost money on the resale transaction, even without including carrying costs."
September is showing a similar pattern, with only one of the five sales netting a gain, and this is also excluding developer fees, association contributions, and so forth.
Stearns expects the market to continue to weaken with an additional 11,000-plus units on the cusp of flooding inventory.