Re-published with the permission oif RisenLife Realty.
The Miami real estate market is currently one of the most popular and profitable markets in the United States. Investors moving their business into Miami-Dade County are set up to be part of a booming property market, particularly in the coming decades. Throughout the last century, Miami has been a prime vacation spot as well as a strong residential and commercial sector. The city has continued to grow exponentially in the past decade, strengthening its economy and making a prime name for itself even among international buyers. For real estate agents considering Miami, it is prudent to understand why the city, especially the Downtown area, is an incomparable place to consider farming real estate.
Real estate farming refers to the practice of focusing real estate investments in a particular neighborhood or regional area or a specific demographic based on the market qualities it offers. This guide will go over just a few of the many reasons that Downtown Miami is a phenomenal neighborhood to consider focusing your real estate investment efforts.
Since the housing bubble burst of 2008, investors of all types, including real estate agents, have been doubly careful in choosing their investments. It is only natural that investors want to be sure of the most relevant and up-to-date information available on potential market ventures before they make decisions backed up by time, work, and money. No entrepreneur wants to go into a market without reasonable assurance that it is worthy of their trust. This leads many new and even experience real estate agents to seek out markets already showing great promise, proving that they are worth the risks associated with any form of investments. These are, in fact, precisely the reasons why Downtown Miami is a prudent choice for real estate agents weighing the pros and cons of various markets in Southern Florida.
Miami holds up almost effortlessly with competing metropolitan areas both in the United States and internationally. Since 2010, Miami-Dade’s population has risen by more than 10 percent and continues to grow, while Southern Florida remains the second-highest recipient of new residents annually in the United States. Reports estimate that Miami’s population will grow to 7.5 million residents by 2040, a growth of 2 million people in a mere two decades. There are many reasons why Miami has continued to attract people both in modern times and in the past, from breathtaking seaside sights and incomparable climate to unrivaled culture.
Like every other city, Miami consists of a variety of neighborhoods with competing cultures, attractions, and housing markets. Although Downtown Miami has been a neighborhood of retail and business properties until recent years, the 2010s have seen an explosion of residential properties in the area.
The History of Downtown Miami
From its founding, Miami has been a place of strong cultural diversity and economic growth. This diversity began in the 19th century with industrialist Henry Morrison Flagler, an early and consequential investor in the Miami economy. Flagler financed and helped construct railroads, streets, utility systems, and a resort hotel, as well as canals to drain water from the Everglades that inundated most of the region at that time. In response to Flagler’s work, tourists and new residents swarmed the rapidly expanding Miami area, a migration that has not stopped since. The city quickly became a seat of wealth and success. The constant development and appeal of the region have made the Miami real estate market prone to frequent surges.
Soon after Flagler’s instrumental developments, two men named Carl Fisher and John Collins began to promote the Miami area. Fisher and Collins popularized Miami Beach across the United States, turning it into a major tourist hub and vacation spot. Fisher and Collins also built hotels, stores, and clubs in addition to the famous Dixie Highway, further strengthening the area’s growth. The economic surge created by these entrepreneurs continued until it met an even more consequential surge in 1926: A major hurricane hit the coast, leaving no time for recovery in time for the 1929 market crash.
In the wake of the storm, Miami birthed its renowned Art Deco District as a strategy to revitalize its real estate market. Coinciding with the Harlem Renaissance popularity of Overtown, the Art Deco District made great strides in making Miami a national hotspot once again. Overtown, known at the time as “Little Broadway,” featured such nationally recognized names as Louis Armstrong, Cab Calloway, and Duke Ellington, who favored Miami Beach and drew ever more visitors to the area.
After the Great Depression, the economic boom coinciding with World War II gave Miami a leg up in its recovery. Hundreds of thousands of the enlisted were sent to train in Southern Florida, giving a powerful push to the local marketplace. After the war, thousands of these soldiers come back to Miami to settle or visit. In both instances, those reporting for duty gave even more steam to the Miami real estate market and contributed to the creation of a steady market boom by the 1950s.
When Fidel Castro and his revolutionaries took power in Cuba on New Year’s Day 1959, a massive influx of Cuban immigrants poured into the Miami area to seek asylum and wait out what many hoped was a temporary interruption to their normal lives. As it became clear that Castro’s government would not see a quick end, many of these immigrants settled permanently in Miami, adding more strength and ingenuity to the local economy. Additionally, Cuban immigrants further diversified the local culture, bringing their own customs and talents in ways that permanently shaped the face of Miami.
Cuban immigrants were not alone in their cultural and economic contributions to Miami, symbolized by the famous Little Havana neighborhood containing more than half a million Cuban-American residents. Before the rise in immigration from Cuba, the Caribbean and African-American communities grew to become one-third of Miami’s entire population. In the late 1970s, more than 100,000 Nicaraguans and Haitians emigrated to the Miami area in the wake of their countries’ own revolutionary movements, and between April 15 and Oct. 31, 1980, at least 150,000 new Cuban immigrants arrived in Miami by way of the Mariel boatlift.
Miami as an International Business and Tourism Hub
Over the last century, Miami has increased and sharpened its focus on becoming a center for international business ventures, from startups to global corporations. Out of any city in the United States, none can boast as many international banks as Miami, a consistent and growing characteristic of the city for the last century.
The Greater Miami Visitors and Convention Bureau has reported that ever greater numbers of visitors. The bureau indicates that hotel occupancy rates are up, more money is being used for purchases in the city’s restaurants and bars, and more people are using Miami’s ports than ever before. Other reports show that 900 people migrate to Florida each day to begin life as permanent residents in the Sunshine State; the population of the state as a whole is up, and Miami is the central hub of that migration. In 2014 alone, the taxable property values increased by 7.8 percent as a continuation of the post-2008 economic recovery. This coincides with greater numbers of new construction projects and investments throughout the city.
History Living in the Present Day
Miami is in the unique position of being a community rooted in its history yet pressing forward into the future. The city has preserved an abundance of historical architecture and boasts a one-of-a-kind combination of historical styles. Buildings and monuments throughout Downtown Miami preserve the best of Mediterranean revival, art deco, modernism and postmodernism, and the famous Miami modern of the 1950s and 1960s. Contemporary architecture has also blossomed throughout the Downtown region for the last 20 years.
Downtown Miami is incredibly rich in cultural diversity, bringing together Cuban, African-American, West Indian, Caribbean, Brazilian, Honduran, and Nicaraguan influences, in addition to many more. In fact, Downtown Miami boasts far more diversity than most other cities in the United States, giving anyone looking for deeper exposure to the great cultural treasures of the world an opportunity to achieve it just by walking out the door.
Development in Miami in recent years has reached a strong and stable rate, with the introduction of new condominiums, apartments, and development complexes. As a result, real estate agents can secure new or newly renovated properties for potentially lower prices as developers seek to move on to future projects. The Downtown and wider Miami real estate markets are in a moment of prime opportunity for new investment. In addition, Miami-Dade County’s unemployment rate is in a steady decline since 2010, resting at 4.3 percent in July 2018, which is currently better than the United States’ national average.
Considering all of these factors, it is no surprise that Miami is abuzz with new and growing national and international businesses. Tourism continues to be a massive plank in Miami’s economy, going from a winter-season business opportunity to year-round stability. Miami is an incredibly popular international destination for both personal vacations and business trips due to its proximity to Latin America and the Caribbean. Miami’s location is also the major reason that its port handles so much of the world’s international trade and cargo, and the Miami International Airport transports more international freight than any other carrier in the United States. The city holds more than 60 consulates, dozens of international trade offices, and numerous multinational corporate offices, making it one of the cornerstones of the global economy. Miami also boasts the largest number of international banks on the East Coast south of New York.
These are simply a few of the many reasons that Miami is a brilliant place for real estate agents who are looking to do business in a thriving marketplace. Real estate farming, whether geographic or demographic, is something that Downtown Miami is absolutely ripe for. All it takes is knowledge of the craft, familiarity with the city’s history and trajectory, and the determination to take these qualities to their limits.
Amenities in Downtown Miami
Downtown Miami boasts some exceptional schools, making it an increasingly popular area for families with children. Institutions like the Ada Meritt K-8 Center and the Downtown Miami Charter School offer even more options to Downtown residents, giving parents the opportunity to ensure quality education for their children close to home. This makes downtown neighborhoods an ideal place for real estate agents looking for ways to incentivize buyers. A downtown area may not seem like the first choice for families with young children, but a stellar range of education options makes the neighborhood a prime place to find both family and single-person dwellings. Downtown Miami is also home to Wolfson Campus, one part of Miami-Dade College.
Downtown residents have a plenitude of recreational options available to them, often just down the street. Sailing, golf, beach parties and get-togethers, renowned restaurants, scenic parks, and the famous Miami club scene all offer a variety of activities for people of all walks of life and practically every conceivable interest. Miami is a vibrant, busy city that is a prime stop for tourists and snowbirds alike; in other words, people come to the city looking to have fun. Downtown is a prime hotspot for people looking for things to do, which is also something homebuyers are interested in. The vibrant nightlife, unique attractions, and vast range of dining and shopping options make the downtown Miami area a real estate gold mine.
Downtown Condominiums and Middle-Income Apartments
With the advent of the luxury Miami lifestyle has come the age of the Downtown condo, giving visitors and residents looking for short or long stays the ability to fully enjoy Downtown life while living close to the action. In addition, middle-income residents from almost any imaginable background thrive in the city. This is ideal for potential buyers looking for the feeling of a comfortable home base that is still in the middle of the action of the city; they want continuous access to exciting ventures in shopping and dining with the choice to retire to a private place when they need a break from metropolitan life. For most of its real estate history, downtown Miami has been a place of office buildings and retail space, but the 2010s have brought a revival of residential properties in the form of condos, apartments, and houses.
Downtown Miami’s historic district is home to 60 historic properties from the earliest days of the city’s development. Many of these buildings sprang up during the economic boom of the 1920s. Today, they beautify a large section of Downtown Miami, where they are a recognizable part of its unmistakable skyline. The historic district is one of the proudest possessions of the city and is a neighborhood that residents and tourists alike return to for education, relaxation, and entertainment. Downtown Miami has done a remarkable job of preserving the beauty and heritage of these edifices, while also integrating the historical architecture into the surrounding contemporary building. This gives the city a distinct advantage over many other cities, which have either failed to preserve their historic character with new construction projects or have attempted to freeze their downtown in time while infringing on new growth.
The combination of arts, entertainment, recreation, and historic interest with the solid office and retail space and newly constructed residential properties makes downtown Miami a dynamic place to invest in real estate. This assortment of property types gives real estate agents a wide degree of flexibility to get creative and carve out their own paths in building a business that is unique and offers properties unlike any others.
Trends in Downtown Miami
The latest trends in the downtown area show a decrease of 16 percent in median home sales in the 2017-18 fiscal year. Additionally, during this period, the price per square foot decreased from $363 to $328. Unlike many metropolitan areas, such as Los Angeles, New York, and San Francisco, the Downtown Miami area is becoming more affordable for new residents as more residential spaces are built and the economy continues to grow.
In the last five years, rental properties have been in decline and rent prices have dropped. However, this trend seems to be coming around, meaning that real estate agents who invest in rental properties may find themselves taking advantage of a coming upswing.
At $864.2 billion, Miami as a whole is the fourth-most valuable real estate market in the United States, only surpassed by Los Angeles, New York, and Washington D.C. The city has enjoyed a 4.7 percent growth rate over recent years and is projected to steadily continue.
An Insider Secret for Potential Realtors
A smart real estate investor will keep their eye on the budding Downtown residential scene, which is one of the fastest-growing sectors of the Miami real estate market. As Miami continues to grow in popularity with both seasonal and permanent residents who are more frequently seeking greater accessibility to Downtown amenities, the residential sector will continue to expand in size and value. This leaves ample opening for investors to secure a strong stake in the Downtown marketplace by choosing to farm these properties.
In the aftermath of the enormous development of the late 2000s, there are many available properties for real estate agents to choose from in the Downtown Miami area. Developers have long waited on buyers and have begun to reduce prices in the hope of moving on to new prospects. This gives real estate agents a prime opportunity to begin their foray into the area and enables established agents to further expand their business.
Bear in mind that the neighborhood of Downtown Miami closely follows those of Brickell and Edgewater, so the trends often track together. It is prudent for real estate agents to keep an eye on all three areas to project where each one may be going.
While by no means exhaustive, these points illustrate the reasons why Downtown Miami is a prime location for real estate agents looking to begin or expand their investments. A vibrant and successful community, the Downtown neighborhood is full of innumerable opportunities for real estate investment, giving it a powerful appeal to real estate agents interested in a diverse menu of property types. The one-of-a-kind combination of tourism, residential properties, vacation spots, restaurants and shops, beachfront and seaside properties, and condos and apartments makes Downtown Miami a thriving center that continues to attract more investment from every sector of the national and international economy.
Real estate agents in Miami are not limited in size or scope when considering what they would like to farm or the customers, foreign or domestic, they would like to serve. Should you decide to build your business in Downtown Miami, you will have the above location types and many more available to you. Whether you want to interact with luxury customers seeking the famous Miami lifestyle, a middle-income family looking for a place to call home, or a snowbird trying to find a comfortable spot to get away and unwind, you are certain to find a wonderful intersection of a growing customer base and plenitude of properties to suit it. By taking a stake in the Downtown market, you can be assured that you are becoming a part of a real estate market whose pride and strength of spirit stretch from an absolutely stunning past into an ever-optimistic future.
The city of Miami has been a place of innovative entrepreneurs and investors for centuries. In the 21st century, it continues to be a place for these same people in new ways. For real estate agents looking for new ventures, Downtown Miami is a prime neighborhood to explore.