Here is the reality in Miami property: the market has shifted. Inventory is going down every day and as a result prices are going up. And now you are probably asking, "Does that mean I missed the bus?"
In my opinion, there are still great properties available for great prices, and there is always opportunity for growth in the brick and mortar industry. But as the market gets more aggressive you need to be smart on how you work your search, your selection and the negotiation process, because that will make the whole difference.
Here are few of the consequences of a market like the one we have now in Miami:
1) Lack of inventory means that realtors who work with real estate investors have to become more creative finding the right property for buyers;
2) With some properties attracting multiple offers, it is important to work with an experienced realtor who has experience in this type of market and has great negotiation skills to help you to get the deal. If you think the contract with the highest offer always wins the property, you are wrong. Sometimes it does, but in this market the seller is often looking for a combination of things that goes beyond price.
3) Timing is crucial. For some buyers, the analysis takes more time than the property is on the market. Sometimes we show properties and by the time the buyer decides to make an offer, the property is already under contract. Buyers need to be more certain and fast with their decision making process.
4) Discounts are overrated in Miami right now. Why? Well, three years ago it was easy to get a 10 percent to 30 percent discount in a property. Now, in most cases, we are talking about a 5 percent discount and if the property has multiple offers, it may get to the point of offering above full price to get the property.
Now, I am sure that if you are a buyer wanting to buy in Miami, after reading this article you might be wondering if buying in Miami is the right choice. I still believe Miami is a great place to buy. Our prices are below Los Angeles, New York and other primary U.S. markets for second home buyers and real estate investors. Prices are still below 2007 levels. And this city is growing in many ways. More people are moving here to live; international buyers see Miami as their second home and as a great place to own investment properties.
So this market, in my opinion will continue to grow. The crash was a bump on the road that we passed and we are now recovering. Real estate works in cycles. There always will be a bump in the road, and we don't know when the next one will come, but it will happen at one point. When I review real estate markets worldwide I don't look at the "bumps in the road." I look for the time that it takes for a market to recover and shift again -- the recovery time is crucial to make a decision on where is the best place to buy.
Now, back to the question, about missing the bus. You might think yes and no -- yes you missed the opportunity to buy at 30 percent discount in 2010. But most people were hesitating to buy at that time. A lot of buyers were looking for the signal of stability and evident growth and decided to wait, and now some regret the decision. The great thing is now you can still find great properties in Miami for a great price. You can still catch the bus.
Valeria Grunbaum is the founder of The International Real Estate Academy and a Realtor specializing in international clientele in Miami. Her Web site is InvestinMiamiFlorida.com.