South Florida Real Estate Bubble False

Author:	Lucas Jones
Source:	Homes Discovered
Date:	March 24, 2006

Without a doubt, the South Florida real estate market is showing signs of cooling but the idea that there is a bubble in the market is an really just speculation.  There are so many factors involved in the market that one could not remark about the situation with a full range of knowledge on the subject.  Sure, in one way or another someone can see a "bubble" but overall, it is just not true. Much of the talk about the cooling or "bubble" in the market forgets to mention how Florida has experienced a hurricane that disrupted business for many weeks.  The hurricane brought business to a stand still and many real estate closings had to be put on hold for weeks or months at a time.  Many people in the media also choose to sensationalize stories such as the real estate "bubble" in South Florida when it realls isn't as bad as it seems. It is, of course, unreasonable to think that the South Florida real estate market can maintain the level of appreciation it has seen in the past 2 years because of how incredibly rapid it has been.  Instead of maintaining 25% to 30% appreciation per year as it has been, a more realistic 10% to 12% is still very strong.  The market is cooling slightly or being brought back to reality.  Many homes that used to sell for far more than they were worth are forced to sell at what they are truly worth. The outlook is great in Florida as more than 1000 people a day move to the state.  South Florida real estate will continue to be in high demand into the future.  As the population booms, coastal properties will go at a much higher premium. Generally, real estate price declines are rare and when they do occur, are usually linked to massive job losses.  In two years time the Miami area has added 126,000 jobs, one of the highest rates in the country.   Compared to the rest of the country, South Florida is a unique real estate market due to the scarce amount of land available for development. Miami is considered to be the gateway to South America and is the main hub for Latin American business activity in the United States. South Florida has the strongest tourist market in the country and continues to draw millions of eager travelers each and every year. With all of these factors in its favor, the South Florida real estate market should continue to be in demand and grow for many years to come.

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