Strong Florida job growth is attracting new residents from across the country. Florida added over 350,000 residents in 2015. The state’s Governor, Rick Scott, is making headlines for his courting of companies from across the country, and even universities, to relocate to the Sunshine State. While South Florida continues to live up to its pricey, global reputation, Tampa, Jacksonville and Orlando remain attractive for their tamer costs of living and solid real estate and labor market growth. Tourism spending was up by almost nine percent in 2015, and other industries like construction, financial services, professional/business services and education/health services have maintained consistent positive momentum.
The focus of residential development in Miami is likely to shift, as the condo market approaches its peak. Condo sales dropped at the beginning of the year, and developers have been quick to downwardly adjust their required deposit amounts in response. Some development projects have withdrawn in the last few months, however, the Miami Association of Realtors reports that “85 percent of product currently under construction in Downtown Miami is sold.” International buyers remain around 36 percent of total dollar volume of residential real estate transactions for Miami. Area realtors have noted that a depreciation of the dollar would help their market. Single-family construction and existing home sales are improving, especially in the low and mid ranges. This growth will fuel the regional housing sector through at least this year. Development will continue to broaden outside of Miami, as bargains are sought outside the city limits.
Job growth in Miami, as in Florida, continues to outpace the national average. Construction jobs are booming, as big ticket development continues across the region. The high-paying financial activities and professional/business service sectors are seeing continued strength. As the area labor market continues to tighten in the area, Miami has seen prices increase more than the national average. This is currently being matched by stronger-than-national income growth, but a mismatch would make Miami even less affordable.
Miami’s international exposure has benefited its growth since the Great Recession, as wealthy Latin Americans snatched up deals while their currency was relatively strong. The future of Brazil will weigh heavily on the real estate and retail industries of Miami. The shift from luxury development to more single-family, accessible real estate will temper risks. The newly-opened doors to Cuba will surely bring more people and trade through Southern Florida, cementing PortMiami’s place among the nation’s fastest-growing ports.
Click here for the complete Miami MSA Regional Economic Update: Miami 2016Q2.