New Index To Track Miami Condo Association Financial Cliff For Investors
The Miami Condo Cliff Index™ is a weekly index that tracks the financial health and stability of condo markets in the tricounty South Florida region of Miami-Dade, Broward and Palm Beach.
The Miami Condo Minute™ is a daily micropodcast by expert Peter Zalewski about the South Florida region of Miami-Dade, Broward and Palm Beach published on weekdays.
Welcome to a new era of condo investing in Florida.
To better track the South Florida market for investors at the start of the 2025 Florida Condo Association Financial Cliff, we have created an index - beginning Jan. 1, 2025 - to closely monitor the overall condo market with a focus on Vintage units.
We are calling our new creation the Miami Condo Association Financial Cliff Investors Index™. On second reference, we will be calling it the Miami Condo Cliff Index™.
The Miami Condo Cliff Index™ is a weekly index that tracks the financial health and stability of condo markets in the tricounty South Florida region of Miami-Dade, Broward and Palm Beach.
The Miami Condo Cliff Index™ is designed to provide insights and trends on the Miami and South Florida condo market from an investor's perspective, with a focus on identifying potential financial risks and opportunities.
Since we will be monitoring more than 20 different South Florida markets and coastal submarkets, we plan to slightly revise the name of each index to reflect the market for which we are tracking for each respective report.
Before we go any further, it is worth noting that Vintage condos are a term we first coined back in the summer of 2024 to define units in condo buildings that are a minimum of three-stories tall and at least 30 years old.
Our criteria mirrors Florida’s new Milestone Study requirement that attempts to accurately and consistently assess condo buildings from a life-safety perspective.
Listen to this report
The Miami Condo Cliff Index™ was created in response to the growing concern about the financial stability of condo associations in South Florida, particularly in the wake of the tragic collapse of the Champlain Towers South condo in Surfside in June 2021.
The Surfside condo collapse resulted in 98 deaths and a $1 billion settlement paid out to the families, highlighting the need for greater transparency and accountability in condo association finances.
In response to this tragedy, the Florida Legislature - influenced by the insurance industry - adopted laws aimed at strengthening condo association governance, reserve funding and building safety standards, in hopes of ensuring that nothing like the Surfside condo collapse ever happens again.
However, these new laws also introduced a variety of challenges and uncertainties for condo associations, including increased costs, mandatory reserves for future fixes and maintenance, regulatory burdens and potential liability risks.
To gauge future volatility, the Miami Condo Cliff Index™ will track the condo markets of South Florida, Miami-Dade County, Broward County and Palm Beach County on a weekly basis, providing a comprehensive and up-to-date picture of the region's condo market.
In addition to the weekly tracking of the overall South Florida market, the index will also monitor a range of submarkets generally east of Interstate 95 on at least a quarterly basis, including:
1. Greater Downtown Miami (Miami-Dade County)
2. Miami’s Coconut Grove (Miami-Dade County)
3. Coral Gables (Miami-Dade County)
4. Miami's Little Havana (Miami-Dade County)
5. Miami’s Upper East Side (Miami-Dade County)
6. North Miami - North Miami Beach (Miami-Dade County)
7. Aventura (Miami-Dade County)
8. Key Biscayne (Miami-Dade County)
9. Fisher Island (Miami-Dade County)
10. Miami Beach (Miami-Dade County)
11. North Bay Village (Miami-Dade County)
12. Bal Harbour - Surfside - Bay Harbor Islands (Miami-Dade County)
13. Sunny Isles Beach (Miami-Dade County)
14. Hollywood - Hallandale Beach - Dania Beach (Broward County)
15. Downtown Fort Lauderdale and the Beach (Broward County)
16. Pompano Beach (Broward County)
17. Boca Raton - Deerfield Beach (Palm Beach County)
18. Delray Beach - Boynton Beach - Lake Worth (Palm Beach County)
19. Downtown West Palm Beach and the Palm Beach Island (Palm Beach County)
Please note, we will adjust the submarkets in the future if necessary.
These markets will be examined in detail, providing a more nuanced understanding of the local condo market trends and dynamics.
The index will track two key metrics:
1. Number of active condo listings in a respective market
2. Number of pending condo sales in a respective market
The pending sales ratio is calculated by dividing the number of pending sales by the number of active listings, and then multiplying by 100.
This ratio provides a snapshot of the market's current state, with higher ratios indicating stronger demand and lower ratios indicating weaker demand.
The index score will be interpreted as follows:
1. 0-19: Severe Buyers Market - a market with extremely low demand and high supply, where buyers have significant negotiating power.
2. 20-39: Buyers Market - a market with low demand and high supply, where buyers have an advantage in negotiations.
3. 40-59: Balanced Market - a market with balanced supply and demand, where neither buyers nor sellers have a significant advantage.
4. 60-79: Sellers Market - a market with high demand and low supply, where sellers have an advantage in negotiations.
5. 80-100: Severe Sellers Market - a market with extremely high demand and low supply, where sellers have significant negotiating power.
To summarize, the Miami Condo Cliff Index™ will be updated weekly, providing investors with a timely and accurate picture of the Miami and South Florida condo market and helping them to identify potential buying opportunities and avoid potential financial pitfalls in South Florida's vibrant and complex condo market.
It is a lot of information but we are confident our index, reports and archives will assist you to better understand current market conditions in South Florida.
It is worth noting that we are sharing a portion of our research for free with subscribers to our newsletter and readers of MiamiCondo.Club.
If you want access to all of our published information and charts, we would encourage you to join the Miami Condo Investing Club™.
The objective of the Club is to create a community that shares realtime, actionable information on the latest real estate trends, opportunities and service providers in South Florida.
The Club is ideally suited for Do-It-Yourself (DIY) condo buyers and real estate professionals, alike, who can rely on our latest statistics, expert opinions and access to consulting services.
Additionally, we encourage you to listen or view our podcast wherever you get podcasts. The podcast is available on Apple, Spotify and/or YouTube.
As a reminder, we are always available for consulting, expert witness work and buyside brokerage services just as we have been since 2006.
If you are seeking information on condo resales in South Florida, please visit CondoVulturesRealty.com or call the office at 305.865.5859.
— Peter Zalewski, Founder of the Miami Condo Investing Club™
The views and opinions expressed in this report is for general informational purposes only. It is believed to be accurate and complete based on current market trends but cannot be guaranteed or warranted as circumstances change without notice. It should not be considered as financial, legal, tax or investment advice. This content should not be relied upon as the sole basis for making any financial decisions. Before making any investment or financial decisions, you should consult with a qualified professional to determine the suitability of any investment or strategy for your individual circumstances and goals.
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