Survey: 2016 Real Estate Market Update
August 2, 2016 | Mangrove Realty Marketing Dept.
Survey: 2016 won’t turn real estate market upside down in South Florida
Real estate insiders expect a strong 2016, according to Berger Singerman survey
But struggling foreign economies will curtail growth
Hotel and retail development expected to pick up
The law firm polled about 100 top developers, Realtors, investors, lenders and contractors for their take on the new year.
“The overall consensus is that things are going to continue in a similar direction,” said Jeffrey Margolis, a partner at the firm. “2016’s going to look a lot like 2015. So while everyone is asking, ‘Are we in a bubble? Is it all going to come crashing down?’, the smart money says that’s not the case.”
About 42 percent of respondents said 2016 will be “somewhat better” than 2015. About 37 percent said there would be “no change” in the market next year. Only 13 said they expect a “somewhat worse” year.
The reason growth won’t pick up much? Struggling economies in Latin America and Europe are holding back the foreign investment that has fueled South Florida real estate since the recession, particularly the new condo market, an important local economic driver. (Single-family homes are still selling at a record pace because of tight inventory.)
More than 60 percent of respondents pegged “global economic conditions and uncertainty” as their top reason for a lack of confidence in the market.
The poll also revealed that developers plan to build more than just condo towers. While 26 percent of respondents said condo development will produce the highest returns in 2016, the hotel and hospitality (21 percent) and retail (20 percent) sectors weren’t far behind.
That’s a change from previous years, said Berger Singerman partner Marc Shuster.
“We’re definitely seeing more diversity in the market,” Shuster said. “Following the multi-family rebound, people have a feeling that these other areas are going to take off too.”