George McCaw of S.E. Buildcorp LLC and Escambia County Florida says that Miami’s luxury housing market is as hot as its weather right now. Buildcorp LLC is a construction firm that handles the design, drafting and renovations of new and existing construction projects in the South Florida area. With the market as wild as it is – George McCaw keeps up to date with the latest real estate news – this includes luxury markets and auctions. Below, Mr. McCaw discusses these luxury auctions in southern Florida and explains why they are being sold as fast as they are advertised.
As the crypto investors and new breed of multi-millionaire entrepreneurs flood South Florida, realtors have struggled to keep up with the demand for luxury real estate.
And for the landed gentry of South Florida who are keen to shift luxury properties off their books, there’s never been a better time to throw an auction says George McCaw.
George McCaw of S.E. Buildcorp LLC and Escambia County Florida explains that the current luxury inventory is down almost 20,000 properties on where it was in previous years.
An increase in luxury real estate auctions in South Florida is good news for sellers—the market is calling out for prime real estate across the core local hot spots. And—speaking of hot—sales are smoking.
According to the latest Douglas Elliman’s Elliman Report, nearly half of all sales in the region last quarter were from the top five luxury markets.
So, George McCaw asks, what’s driving South Florida residents to snatch up the prime real estate cuts in a post-pandemic market? And what sales of South Florida are hotter than a Miami heatwave?
George McCaw of S.E. Buildcorp LLC and Escambia County Florida explains below.
What is Fueling the Increase in Luxury Real Estate Auctions
George McCaw credits the boom to a simple case of supply and demand—and that classic fear of missing out (FOMO).
Shimberg Center for Housing Studies, and the Housing and Urban Development Secretary both agree that in 2021, Miami was the epicenter of the country’s growing housing crisis. It should also be noted that the structural gap between income and housing prices has always existed.
In essence, George McCaw says there’s always been a demand for the finer things in the South Florida municipalities.
Money, Money, Money
George McCaw says that if you factor in the number of wealthy retirees relocating to the area, the influx of new money entrepreneurs, and the yearning desire for big city tech kings to get out of the rat race of New York and Silicon Valley, and the result is the perfect tropical South Florida storm.
The shift towards remote working, and Florida’s friendly position on income tax (as in there is no income tax) are also moving in the Sunshine State’s favor according to George McCaw.
Wealth in the United States has also reached a specific net worth threshold over the past 24 months. In 2020, the number of individuals with a net worth greater than $5 million increased by 2.2%. Impressive, sure, but in 2021 that number soared again—by 19%.
With nearly ¾ of a million individuals newly minted into the high net worth bracket comes a higher demand for luxury real estate.
A Shift in Priorities
The Institute for Luxury Home Marketing’s annual report also noted a sharp increase in demand for luxury homes over the past two years. The report pointed to Miami-Dade County’s fastest growth of demand “during the first year of the pandemic [and] even in April 2022, a higher volume of sales compared to 2021.”
George McCaw of S.E. Buildcorp LLC and Escambia County Florida says that the demand for luxury real estate is high—it’s an undisputed fact. But the increase in luxury real estate auctions in South Florida comes down to strategy—and sellers trying to secure top dollar when they sell up.
Auctions are a careful strategy designed to have buyers thinking about their maximum bid—not their low-ball offer.
The Top 5 Luxury Real Estate Markets in South Florida
For buyers looking to strike while the market’s hot, there is a wealth of premium properties across South Florida. Here are the top performers of 2022 so far.
At the tail end of this top 5 sits the Boca Raton / Highland Beach zone with an average sale price of $5.5 million at the start of 2022. Driving up the average was the sale of a $40 million oceanfront mansion on South Ocean Blvd at the start of the year.
Just edged out of a top 3 spot, Fort Lauderdale earned an average sale price of $6.9 million for the 50+ luxury homes sold in the first half of the year. It also earned an average square footage price of $1,167, making 2022 Fort Lauderdale’s most expensive year to date.
Just south of Miami, Coral Gables is racking up an average sale price of $10 million and up.
Counting Miami Beach, Barrier Islands is Florida’s second most expensive luxury property market for 2022—and the average price for a single-family luxury home is breath-taking. At $17.9 million, and $2,800 per square foot, and a market worth $2.9 billion in sales, Miami Beach is holding on to its status as a playground for the rich and famous.
Is any luxury real estate list complete without Palm Beach. It accounted for more than half a billion dollars’ worth of total sales for the year, with the average sale price for a family home setting buyers back $21 million.