Miami’s Prime Market Value is Growing, Despite Negative Numbers in Most Cities
Knight Frank‘s Wealth Report forecasts how key prime residential markets* are set to perform in 2019, and looks back at how its predictions for 2018 planned out. Miami is expected to be the 5th fastest growing luxury real estate market in the world. According to this Knight Frank report, it is ranked 5th out of 20 global cities and could grow at the second fastest rate in the world.
Worldwide however, value increases are slowing for the prime property markets. Knight Frank and Douglas Elliman foresee slower growth in prime property prices as central banks end easy monetary policy. As we learn to live without the ultra-low interest rates that have supercharged real estate markets globally since 2008, lower price growth is an inevitable consequence of the shift in monetary policy.
*Prime residential property is defined as “The most desired and expensive property in a given location, generally defined as the top 5% of each market by value”
Florida’s Tax Climate and Comparatively Low Sales Prices are Fueling the Growth
For 2018, Miami prime properties were expected to remain stable with 0% market change. The reality was a 3.3% growth in price compared to 2017. This was positive compared to the average increase of prime residential property prices, which was just 1.3%, the slowest rate of appreciation since 2012.
With 33,300 millionaires, Knight Frank expects Miami to record prime price growth of 5% in 2019, outperforming a number of other key US cities such as LA and NYC. Prices are rising from a comparatively low base, new investment in the form of the Brightline train is boosting the local economy and Florida’s low tax status may spur some US residents to move to the sunshine state in the wake of the new State and Local Tax (SALT) deductions.
David Siddons | Siddons.email@example.com | +1.305.508.0899