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Miami pre-constructions: All things come in threes?

29 Jan

miami-pre-constructions-new-developments-brickellAll eyes are nowadays on Brickell Avenue. Miami pre-construction projects are sprouting around like mushrooms and Miami City commissioners are attending one ceremonial groundbreaking after the other. Two days ago, Marc Sarnoff even broke the record by leading three-groundbreaking events in less than four hours. What a race against time!

The streak of ceremonial shoveling began at 10:00 am at The Bond. Its developer Alan Ojeda confirmed that 70 percent of the condos were already under contract. Then, the Mckafka Development Group launched its latest Miami pre-construction, the Crimson. Finally, the Related Group CEO George Perez presented his 453-unit SLS Brickell.

What does this eventful day really mean for the real estate market? On one hand, some say that the current over-confidence of the developers might jeopardize the market in the future. An over-supply of condominiums might lead us to a new bubble. On the other hand, developers rely on clients’ deposits to build their condos. This shows strength in the Miami pre-construction market.

Indeed, sellers and buyers seem to have learned lessons from the latest crash. To reduce the chances of a bubble burst, buyers agree to pay 50 percent of the purchase price before construction. As the clients have already put down a healthy deposit, it’s easier for the developers to get a loan. Finally, most of the buyers have in mind to rent on a long-term basis their unit whereas they were hard flippers during the boom years. That’s pretty comforting, isn’t it?

So if we follow the tracks, all ceremonial groundbreakings will come in threes in the future. Be ready!

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Posted by on January 29, 2014 in News

 

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