Don’t look now, but another condo bubble may be starting to inflate in South Florida:
More than two dozen condominium projects, including five in Broward and Palm Beach counties, are being added to the South Florida skyline in the next few years, according to CondoVultures.com, a consulting firm.
By the end of 2012, as many as 10,000 units could be in the planning stages, the firm said. That’s nearly a quarter of all the existing condos that sold in South Florida last year, according to the Florida Realtors.
To put those 10,000 planned units in perspective, the Sun-Sentinel reports that between 2003 and 2011, developers added 49,000 condo units in Palm Beach, Broward, and Miami-Dade counties. So 10,000′s a lot. What’s more, the expansion is being mainly buyer-financed:
Still wary from losses during the housing meltdown, many lenders aren’t offering construction financing. So Related and other developers are requiring buyers to pay up to 80 percent of the cost of the condos before closing. That means a buyer would pay $640,000 up front on an $800,000 condo.
Just think of what’s going to happen when banks decide it’s safe to start lending again. . . .