Here’s what you need to know about the state of the luxury real estate sector from CNBC.
Dezer Development’s Gil Dezer dabbled in topics like President Trump, Russian buyers and Florida’s beneficial tax laws in an appearance on CNBC’s Squawk Box on Thursday.
Dezer, whose projects include the Porsche Design Tower and the planned Residences by Armani/Casa in Sunny Isles Beach, appeared on the show for a segment on South Florida’s luxury real estate market. “Florida’s Millionaire Migration” discussed how wealthy Northeasterners are buying property in South Florida to establish residency in a state where there is no state income tax.
“A business owner making a million dollars a year will actually be saving enough money in taxes to support a $2 million mortgage in Miami,” said Dezer, who is president of Dezer Development. “That’s really what’s driving sales right now.”
Dezer, who is close with President Trump and has licensing agreements with the Trump Organization on a number of properties in Sunny Isles Beach, said buyer demand for these properties is still going strong. Not only does Florida have a lot of Trump supporters, but South American buyers also like the president and are buying units at Trump-branded buildings, Dezer said.
Fittingly, the conversation turned to Russia. Sunny Isles Beach, where Dezer Development is based, has a high concentration of Russians, and many Russians own units in the luxury condo towers.
Dezer said he is seeing a slowdown of these Russian buyers due to recent sanctions. He is, however, seeing an uptick in Russian-born New York residents who are moving to Florida.
“The Brighton Beach Russians are definitely coming down,” he said.
Recent reports show that the luxury condo market in South Florida is still saddled with high amounts of inventory, however, which is driving down sale prices.
EWM reported that there is 17 years of inventory of condos priced at $5 million and up in Sunny Isles. Overall, Miami-Dade County faces nearly five years of supply of high-end units.
A fourth quarter 2018 report from Douglas Elliman released on Thursday showed that the median luxury condo price in Miami Beach fell to $2.2 million, down 12.4 percent from the same period of the previous year.