Trump’s tariffs are creating a lot of noise, forcing resi buyers and sellers to take a beat.
This is what’s supposed to be the most profitable quarter of the year for residential brokerages and agents. But tariffs have added to buyers and sellers’ doubts.
“People are pausing to find out where the market is going,” says Mike Pappas, CEO of the Keyes Company, one of the biggest independent brokerages in the Florida.
“It is volatile. No question everyone is waiting for it to settle down. People want certainty and clarity,” he says.
It’s not helping that condo inventory in South Florida is on the rise, putting pressure on prices. (I’m referring to the resale market, not new developments.)
Still, Pappas and others are hopeful and optimistic. Historically, single-family homes are more insulated from volatility.
A 10 percent universal tariff and a 25 percent tariff on imports of steel and aluminum are in effect. Goods imported from China face a 145 percent tariff.
Zack Simkins, managing director of Vaster Capital, tells me that spec home developers are going to take advantage of the 90-day pause on country-specific tariffs and buy materials before price increases kick in, as they can store them onsite. Not much is sourced from China, but developers are eyeing increased prices on other materials.
Vaster provides financing to these single-family projects. Instead of underwriting with a 5 percent contingency, the firm is increasing that to 10 or 15 percent.
Luxury resi broker Nathan Zeder, of the Jills Zeder Group at Coldwell Banker, says he hasn’t had any deals canceled.
“Is it going to slow things down? Potentially,” he says. “But it’s hard to tell. We’re still really busy.”
Still, the volatility that stems from tariffs and the Trump administration’s immigration policies could have a greater effect on how buyers behave, especially middle-market buyers.
“If your portfolio goes down, that might give [buyers] some pause,” Simkins says. That’s especially true for second home buyers from Canada. Simkins still believes in the South American investor-buyer “as long as they feel confident in their visas and ability to get in.”
“Trade wars, inflation, they’re used to that,” he says. “The other side of that is the thinking that, ‘Well, I go to America to avoid it, not experience it again.’”
What we’re thinking about: I don’t know why, but I’m kind of obsessed with The Ticket Clinic founder Mark Gold using the fortune he built off of others’ traffic citations and DUIs to build a proposed car condo condominium in Pembroke Pines. Are car condo projects back? Send me a note at kk@therealdeal.com.
Special thanks to Kate Hinsche for contributing to this newsletter!
CLOSING TIME
Residential: Waste management magnate Patrick Dovigi paid $27.5 million for a waterfront Sunset Islands estate. The 11,340-square-foot mansion at 1525 West 24th Street in Miami Beach was built on 0.6 acres in 2005 and has seven bedrooms, nine bathrooms and 156 feet of waterfront. It hit the market for $32.8 million in September.
Commercial: Blackstone paid $115.9 million for the 359-unit Solea at Miami Lakes apartment development at 17405 Northwest 94th Court. Greystar sold the 20.2-acre property for about $323,000 per unit.
NEW TO THE MARKET
Broker Howard A. Parker of Howard A. Parker Realty is listing his own property, a waterfront estate in Manalapan. Parker listed the 12,000-square-foot, seven-bedroom and eight-and-half-bathroom mansion at 1275 Lands End Road for nearly $40 million. The 1-acre property fronts the Intracoastal Waterway. The house was built in 1992.
A thing we’ve learned
Four Florida restaurants won Michelin stars last week, and all of them serve Japanese or Japanese-inspired cuisine. Itamae Ao in Miami, Chef’s Counter at MAASS in Fort Lauderdale, Konro in West Palm Beach and Ômo by Jônt in Winter Park earned stars in the latest Michelin Guide, according to Eater. They mark the first such awards for restaurants in Fort Lauderdale and West Palm Beach.
Elsewhere in Florida
- A 20-year-old man killed two people and injured six others in a mass shooting at Florida State University's Tallahassee campus last week, police say. The alleged shooter, the son of a sheriff’s deputy, was shot and taken to a local hospital. He used his mother’s gun in the attack, the Tallahassee Democrat reports.
- Resignations and questions around the legality of a $10 million donation involving a charity started by Florida’s first lady Casey DeSantis are dogging the organization. Attorney Mohammad Jazil and executive director Erik Dellenback both quit, as DeSantis’ Hope Florida Foundation faces scrutiny for dispersing millions of dollars from a Medicaid overbilling settlement that ended up with political committees controlled by the governor’s former chief-of-staff, according to published reports. “This is looking more and more like a conspiracy to use Medicaid money to pay for campaign activity,” said Rep. Alex Andrade, a Pensacola Republican, CBS reports.
- Cuban-American billionaire Mike Fernández wrote an open letter blasting Cuban-American Republican leaders for their response to President Donald Trump’s immigration policies, according to the Miami Herald. Fernández heads MBF Healthcare Partners and has donated millions to Republican candidates in past elections. “In the face of all of this, the silence from our own leaders — the sons and daughters of exiles — has become deafening,” he wrote.