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Florida Real Estate: Surviving The Mortgage Bust
The mortgage bust that hit the U.S. resulted in a major decline in the real estate market.
Florida and Miami were among those who were hit the hardest in the market decline of residential and commercial properties. Though compared to the state of the real estate market in 2006 and 2007, many analysts predicted that recovery is possible this year.
Mass Foreclosure Hit Florida
Due to the devaluation of the currency, as well as the high interest rates of many financial lenders, there has been a mass foreclosure going on in Florida. As the number of investors failed to pay their obligations, banks and other financial institutions were practically foreclosing properties left and right. These foreclosed residential units added to the rising number of unsold homes, which further depressed the current real estate market.
Failed Condo Projects Converted To Rental
Overbuilding of condominium units during the early market boom contributed to the decline of real estate market in Florida. At the moment, there's a large supply of vacant condo units which was never acquired by any of the locals, and is converted into rentals to make ends meet.
But before that, the lack of market and acquisition of these condo units affected the rental income growth of Florida, which in turn made a negative impact on the overall percentage of the real estate economy.
Despite these problems, however, late months of 2007 ended in a positive result in the market. Since the conversion of these condos into rental residential units, the market seems to have stabilized and is projected to improve in the coming months.
Apartment Rental Booms
The downfall of condo acquisition sparked the current market boom for apartment units. According to the figures of REIS, there's an approximate of more than 230,000 residential units available in the market since 2007, with an average monthly rent of $1,062 per unit.
Also, the increasing demands of new workforce in the state produced a higher demand of residential units in South Florida. Construction projects for apartments can be seen all around the area to address it. Analysts are now reporting that development for such real estate will continue to be seen in the next 24 months.
Foreign Acquisitions On Residential Properties
There has been an increasing number on acquisition of real estates, especially condos, from foreign investors. According to statistics, it seems that Canadians and Europeans are taking advantage of the currency devaluation by purchasing condo units in the city at a cheaper price. Since they are not affected with the mortgage crisis that is prevalent in the nation, the investments they put it are likely to be affordable on their end, in contrast to local investors.
Vanessa Arellano Doctor http://miamirealestateinc.com
http://miamirealestatetrends.com - Miami Real Estate
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