Aventura condo resale prices move closer to 2006 levels

Peter Zalewski of CondoVultures
Peter Zalewski of CondoVultures

Question: What is happening in the Aventura condo market? What is happening with prices?

Resale prices in the Aventura condo market are slowly moving closer to the levels set at the top of the last South Florida real estate cycle in 2006.

Buyers purchased more than 1,250 condos  about 105 units monthly — at an average price of $255 per square foot in 2014, according to the Southeast Florida MLXchange.

Back in 2006, buyers paid an average resale price of $291 per square foot for condos in Aventura. That same year, buyers purchased less than 700 condos for an average transaction velocity of about 57 units per month, according to the data.

After reaching the top of the market during the last cycle, Aventura condo resale prices plummeted to an average of about $174 per square foot at the bottom of the market in 2010, when less than 1,050 units traded.

Since then, Aventura condo resale prices have been on the rise even as the number of annual transactions has been mixed year over year.

In 2011, buyers acquired about 1,270 condo resales  about 106 units monthly — at an average price of $175 per square foot. The following year, buyers purchased more than 1,360 condos  about 114 units monthly — at an average price of $198 per square foot. In 2013, buyers acquired less than 1,335 units  about 111 condos monthly — at an average price of $243 per square foot, according to the data.

Despite the reduction in transactions, sellers appear to be optimistic that condo resale prices are sure to climb in Aventura.

To date, more than 1,000 condo units are on the resale market in Aventura, at an average asking price of more than $335 per square foot, representing a 32 percent premium from 2014, according to the data.

It is worth noting that the current supply of condo units available for resale in Aventura represents nearly 10 months of inventory. A balanced market is generally considered to have about six months of inventory available for purchase. Less than six months of inventory typically indicates a seller’s market, and more than six month suggests a buyer’s market.

Besides the rising prices in Aventura, another factor that could be contributing to the slowdown in the number of condo resale transactions is the amount of preconstruction condo units proposed for the area.

Developers have announced plans to build 13 new condo towers with more than 2,100 units in the Aventura area as of Friday, according to the preconstruction condo project website CraneSpotters.com. (For disclosure, my firm operates the website.)

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To date, one tower has been completed, four towers are under construction and the remainder of the announced projects are in the presale or planning stages.

The unanswered question going forward is how long it will take for Aventura condo resale prices to match and ultimately surpass the 2006 levels given the amount of existing and new inventory currently available for purchase.

Thought Of The Week: Has A New Soccer Field Site Emerged For Beckham?

More than a year after soccer legend David Beckham first officially announced his intention to bring a new Major League Soccer franchise to South Florida, the former Manchester United star has still not been able to nail down a stadium site in Greater Downtown Miami.

Beckham’s original plans called for building a stadium on the west side of PortMiami.

When that effort failed to garner the necessary support, Beckham was forced to consider filling in a deep-water boat slip between the American Airlines Arena and the new Museum Park on the east side of Biscayne Boulevard for his proposed 20,000-seat stadium.

Once again, Beckham was rejected.

As the international celebrity athlete searches for a third option for a home field, a temporary  but highly unlikely  fix for Beckham’s need for a soccer pitch could soon be found at the planned Miami Worldcenter mixed-use project going up a block west of the American Airlines Arena in Greater Downtown Miami.

Developer Daniel Kodsi announced plans this week to incorporate a soccer field into an outdoor sports complex at his new 60-story Paramount Miami Worldcenter condo tower slated to go up between Northeast 8th and 10th streets just west of Northeast 2nd Avenue.

Kodsi is promoting the soccer field as just one of the many amenities for presale buyers in his proposed tower that will feature nearly 500 luxury units.

If Beckham ends up not being able to find an appropriate stadium site by the time the Paramount Miami Worldcenter is scheduled to open in 2018, the English star might want to consider buying up a series of condos from Kodsi that overlook the tower’s soccer field and convert the units into luxury suites for spectators to watch future matches.

Peter Zalewski is a real estate market consultant, non-practicing licensed real estate broker and columnist for The Real Deal who now answers reader questions about the South Florida real estate market in a new weekly Friday column. Questions and comments can be sent to southfloridanews@therealdeal.com. The TRD editors will choose which submissions will be addressed.