Watching as the Miami real estate market soared, Alexander Midler decided to make his move.
After eyeing a number of condo projects, the 32-year-old Boston software engineer recently settled on a one-bedroom condo at Jade Beach in Sunny Isles near North Miami Beach.
The price: $800,000.
It wasn't the cheapest place he found, but he figured an oceanfront view in an exclusive building filled with wealthy South Americans and Europeans would buffer him from a potential economic or housing downturn.
"I was looking for the safest investment I could make," said Midler, who is planning to move to Miami in a couple of years.
And with condos in the immediate area appreciating as much as 75% annually, Midler figured that he might sell the unit before he closed and make a tidy profit.
That would make him one of the market's many "flippers," people not looking for a place to live, but rather a way to make a quick buck.
While some booming housing markets have cooled, Miami's continues to get even hotter. With land scarce, most of the growth is coming from high-rise condos.
In Miami, nearly 70,000 condo units are under construction or in the pipeline, including high rises designed to soar more than 70 stories.
Miami home prices, which include condos, have shot up about 30% over last year. Relative bargains just five years ago, the average condo now costs about $300,000.
"We are going through the greatest expansion in housing in south Florida � particularly in Miami- Dade � in its history," said Michael Cannon, president of Integra Realty Resources-South Florida.
A long period of low interest rates has fueled a housing boom nationwide. Miami stands out as a relative newcomer to the hot list of markets and for the sheer number of new condo projects under way.
Fueling demand are buyers from South America and Europe as well as second-home seekers from the Northeast, real estate watchers say.
In addition, a growing number of permanent residents with high paying jobs are moving into the area.
Along with Tampa, Miami in the first quarter led the nation with the sharpest increase in available jobs paying $100,000 or more, according to a survey by TheLadders.com, an online executive search firm.
"We have almost 200 people moving to Miami and Fort Lauderdale every day and who knows how many second-home buyers," said Ron Shuffield, president of Esslinger-Wooten-Maxwell Realtors, or EWM, one of the largest realty firms in the area. "That means by the end of the week there will be at least 1,400 people who want to live in the area, or 6,000 new people a month."
Lack of supply is putting a lid on unit-sales growth.
"Our unit sales for the last two months are less than a year ago and the sole reason is we just don't have enough homes to show people," Shuffield said. "In some neighborhoods, we don't have anything to show."
Miami-Dade has just 2.8 months supply, Shuffield says. Just north in Broward County, which includes Fort Lauderdale, supply is at a record low 1.9 months. That compares to about five months of inventory nationwide.
Even with all the new supply in the pipeline, real estate observers don't expect the south Florida market to crash like it did in the mid-1920s and 1980s and early 1990s, when unsold units glutted the market.
"When you leave the beach and drive west in Miami or Fort Lauderdale you only have about 20 miles of dry land," said Shuffield. "We have now built on almost all of it."
Since there's little room to build on, developers are going vertical. They're targeting neglected areas in or near downtown and any vacant parcels near the water.
Just two years ago, single-family homes in Miami made up the majority of EWM's sales volume. That number is now reversed, with condos accounting for 58% of sales and single-family homes 42%. In Miami Beach, condos are 87% of EWM's total.
Many buyers are investors, or so-called flippers. They lock in at discounted pre-construction prices and sell as soon as they are able. Sometimes even before closing.
So far, they've found plenty of buyers willing to pay up.
"Condominiums have almost become a commodity," said Jorge Perez, chairman of the Related Group of Florida. "The (stock) market fluctuates daily. Oil is up, it's down. A lot of people are saying they feel more comfortable with a more tangible investment."
Developer Perez is happy to oblige. His firm has 14,000 condo units under construction, most of them in Miami.
They include the 60-story luxury project Icon Brickell, designed by the architectural firm Arquitectonica, whose trendy early buildings were featured on the TV series "Miami Vice." Interior design is by the well-known Philippe Starck.
The first 750-unit Icon tower sold out in two days. His most expensive project, the Apogee, just broke ground at the southern tip of Miami Beach. Units sell for $4 million to $15 million. "We have four units left. So come and get it," Perez said.
Shuffield expects real estate prices to eventually soften, but he's not too worried.
"This is like an escalator," he said. "The escalator may slow down a bit, but it always keeps moving. So it's just a question of what step you want to get on."
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