Miami Condo Market Speculative: CSFB
A mid-sized condo developer in Florida was downgraded by Credit Suisse First Boston, characterizing its future as "neutral at best." The market is threatened by "investor speculation", and the shares of WCI Communities lost 4% on the news.
The Miami Herald report found at Planet Realtor includes the typical arguments surrounding the question of overheated markets. But one bit of data may be telling. "South Florida is in the midst of an unprecedented condo development boom. More than 55,000 residential condo units are in some phase of development in Miami, and..increasing monthly. In contrast, Miami has built about 7,000 condo units in the last 10 years."
Nor was the story lacking in humor. "Downtown developers have brushed off worries about rampant speculation..'I don't see it backed up by empirical statistical data' said Pedro Martin, CEO of Terra Group (which) recently signed a contract to buy 10 acres..for $190 million(!)'You don't put 20 percent down on a $500,000 condo when you are a speculator' said Martin, who has two other high-rise projects in downtown Miami."