Waterfront Growing Scarce Property
2/6/2005 6:05:03 PM by By JANA SOELDNER DANGER
"If youre lucky enough to live by the water, youre lucky enough." So reads the inscription on a wall plaque sold in a national catalog. Living by the water is popular just about everywhere, but South Floridians seem to be especially covetous of the privilege.
As waterfront land for residential development grows scarcer and scarcer, demand seems to grow stronger and stronger. While there may be the beginnings of a slower market for other kinds of property, real estate professionals say the market for waterfront continues to sizzle.
"Waterfront real estate in South Florida will always be one of the hottest markets worldwide," said Teresa King Kinney, CEO of the Realtor Association of Greater Miami and the Beaches. "Our waterfront property is some of the least expensive of any international city."
The desire for beachside living seems to be almost universal, said Elliott Sharaby, developer of Courvoisier Courts on Brickell Key. "Everybody wants to be by the water," he said. "Its South Floridas best trait, and theres not much property left on the water. Its very difficult to find any to build on were getting close to the point where that will be it."
In this market, waterfront property moves with lightning speed, said Philip J. Spiegelman, president of the Aventura-based International Sales Group, which specializes in condominiums. "Prime waterfront properties tend to sell out before construction begins," he said. "Theres been no slowdown in enthusiasm for prime waterfront from local buyers, buyers within the continental U.S., or buyers from South America and Europe."
The majority of buyers Spiegelman deals with plan to hold on to their property. "They arent flippers (investors who buy hoping to resell at a higher price within weeks or months). Theyre people who see the long-term value of waterfront property in Florida, and are able to make informed decisions when they buy," he said. "Theyre sophisticated enough to compare whats available in the market, and recognize a good product in a great location."
Because the property is so coveted and sells so fast, it can be hard to find. "The listing inventory over the past summer has been extremely low compared to the last few years," said Sonja Bogensperger of Majestic Properties. "This means that whatever came into the market sometimes did not even make it to the MLS (multiple listing service).
"Today, as we are moving into the season, we have a slightly higher listing inventory, so buyers have a somewhat better choice as far as waterfront properties are concerned," Bogensperger continued. "They are especially highly sought after, and move quicker than anything else on the market, especially single-family homes. People still want to live here."
At Villa Flora, a luxury townhome development in Aventura built adjacent to the Williams Island Marina, buyers can have a slip to accommodate a boat up to 120 feet. "Its a huge selling point, because its unusual to find somewhere you can have a boat in the backyard," said Ken Weitz, director of sales and marketing for the project. "But were getting a mix of boaters and non-boaters. The views are fantastic, and for many people, its fabulous just to be able to look at the marina."
Most of the buyers at Villa Flora are local, Weitz added. "Theyre people who have lived in the city for many years, and have close ties to the community," he said. "Theyre looking for something more maintenance free, and with more amenities."
Veronica Cervera, a partner in a Miami-based real estate company that carries her name, is seeing plenty of international buyers. "People in Europe are saying its their dream to have a place in Miami," she said. "Its less expensive to entertain your family here, and European kids love to shop here. Miami is very affordable."
A favorable exchange rate for the euro and the British pound makes a South Florida home purchase even more attractive for overseas buyers. "They can take 30 to 45 percent off the top just because of the exchange rate," King Kinney noted. "The value of our real estate, the security of the investment, and the safety of the marketplace, in addition to our wealth of entertainment, shopping and general destination lifestyle, make Miami and South Florida an ideal location for international buyers."
Mexico has become an important market, Cervera said. "Mexicans feel comfortable here because many of them have friends here. They bring their extended families here, while Europeans tend to stay within their nuclear families."
Mike Pappas, president of Keyes Company, said affluent baby boomers are heating up the market. "A tremendous number of them have inherited money from the World War II generation," he said. "Waters a scare commodity. Its like a rare diamond. People with money want it, and there are more people around with money."
Once purchased, a waterfront home tends to appreciate faster than other property, Pappas continued. "The problem is, theyre not making any more water, and environmental restrictions are tightening the market. Gables by the Sea, for instance, probably would not be able to be built today, because they had to cut through the mangos."
Even if property is not directly on the water, proximity to it can be a major selling point, said Paolo Scattarreggia, a developer of Absolute Bay Lofts and a partner in Miami Lodge Realty. The condominium building is about a block from the water, but the wet stuff is visible from the units. "The view is enough to be an attraction," he said. "When you can see the water from the balcony or the pool deck, its a big draw."
Scattarreggia himself lives in a building directly on the water. "I want to be able to see the ocean in the morning, and take the elevator down to the beach," he said. "When you live here, you dont have to go on vacation."
Where a body of water doesnt occur naturally, developers sometimes create one. At Orchid Grove in Pompano Beach, Coscan Development dug a four-acre lake. Abridge leads to an island in the center, where theres a gazebo decorated with artwork.
Small ponds for water retention would have been necessary to develop the property, but Coscan decided to do something better. "There are huge premiums when a home site is on any body of water," said Coscans Al Piazza. "So rather than create ponds for water retention, we created a water amenity."
The market for waterfront property in South Florida is likely to stay hot for a long time to come. "It will continue to boom because the sun keeps shining," Pappas said. "If it starts to snow here, people may quit coming."