Nearly 80% Of Buyers At Reach Purchased As Investment
July 27, 2017 by Lucas Lechuga
One year ago, we noticed a shocking yet not unexpected trend at Brickell City Centre's Reach Tower. At that point, 277 of the building's 390 residences had closed, and 30% of those had already come back to the market as rentals. We knew that a significant number of buyers had purchased as rental investments, but had not seen the exact figures. It was intriguing, and we have followed the numbers as the building continues to fill up.
And here we are. A year has passed and according to the tax rolls, 351 units have closed. Of those, 34 have come back to the market as resales, 191 as rentals, and 55 owners put their units up for sale and for lease. That leaves only 71 units to be used by the owners. According to the tax rolls, none of the owners had filed for the Homestead Exemption, so it appears that those 71 owners are part-time residents.
Over the coming days, we are going to be calculating the same figures for other buildings that recently opened. Do you think we will see the same trend throughout the marketplace, or is Brickell City Centre an exception?
Sara –
Very interested to see comparative analysis across buildings but the important question is actually: how can prices sustain in Brickell (and downtown) due to record new rental supply?
Reach & Rise, Heights East & West, SLS, and Bond… That’s 6 new towers looking to lease probably +1,000 units. Now combine mega apartment projects like Panorama and Solitair, all of sudden we’re adding another 1k and this is all over less than two years. Downtown still has even filled Monarch with Avant on the way and the list goes on for new buildings still coming ’18 and even ’19.
We’ve never seen rental supply combined with condo supply on this scale. So as investors stuggle to fill rental supply (which we are already seeing from Reach/Rise and Bond) what will happen to condo prices across the board?
Hello Marcus, I agree with you! I’m currently running numbers of all of those buildings to try and see what we’re in for.
I do think Panorama started their campaign WAYYYY too strong and WAYYYY too early, but its their money…
As for the other buildings, there is a stark difference in renting a condo vs renting an apartment. That may be a good blog post on its own, as you mentioned…I will go for it!
There will be plenty of new options for renters , either condos or apartments buildings , we will see very good opportunities in this market , in both new units and second market units ( old buildings) , that they will be forced to compete with the new units added that at the same time will be forced to rent for a lower estimated price of what they were purchased for …… same will happen for sales .