Real Estate

Downtown Miami Has Nearly Six-Year Backlog of New Luxury Condos Amid Housing Crisis

Earlier this year, real-estate analyst Peter Zalewski warned that South Florida developers had so overbuilt luxury condos for the global 1 percent that it would take an estimated four years to sell them all. At the rate condos were selling in downtown Miami, he found, the 505 available units would have taken nearly 6.5 years (78 months) to sell during the slower, winter buying season. In the meantime, low- and middle-income Miamians are suffering from a dire lack of basic affordable homes.

Well, the state of affairs in what Zalewski dubs "greater downtown Miami" has grown only worse.

Now, according to a new report Zalewski's issued this week, even more luxury units are available downtown. For sale are 559 "preconstruction" units at an average price of $2.13 million. Even at the peak of the Miami summer real-estate "buying season," Zalewski warns, those 559 units could take 70 months — or 5.8 years — to sell. The Real Deal South Florida first reported about his study Wednesday.

"It is worth noting this report only tracks those Greater Downtown Miami condos formally listed for sale. The report does not factor in the nearly 47,500 new condo units currently in the development pipeline east of Interstate 95 in the tricounty South Florida region," Zalewski's study ominously notes.

Though Zalewski's estimates fluctuate from season to season, the overall trend is clear: Miami's real-estate development community and public officials have approved a truly absurd number of new luxury condo projects pitched at global investors rather than actual Miami residents.

Naturally, it's pretty impossible to pump that much supply into a city's real-estate ecosystem without prices collapsing — and Zalewski says elsewhere on his website that the condo market is "slumping" and undergoing a "correction." Importantly, the housing market overall does not seem to be slumping.

As New Times wrote last time Zalewski released a similar dataset, the information shows that Miami's real-estate market simply is not designed to benefit working residents. Given the high price of land in Miami-Dade County, it's more profitable for developers to target global investors and rich vacationers who want to either stash and/or launder money in the United States or purchase a third, fourth, or fifth vacation home they can leave empty 49 weeks of the year.

In the meantime, studies on working-class housing affordability in Miami remain as grim as ever. Restaurant workers can't afford 99 percent of Miami-area housing. Miamians need to earn $50,000 to afford two-bedroom apartments. And waiting lists for affordable-housing units are often years long and include thousands of applicants. 
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Jerry Iannelli is a former staff writer for Miami New Times from 2015 to March 2020. He graduated with honors from Temple University. He then earned a master's degree in journalism from Columbia University.