Posted on 10/09/2024 8:16:18 PM PDT by SeekAndFind
Following in the footsteps of NFL star Tom Brady, Citadel CEO Ken Griffin, and the mayor of Flavortown, David and Victoria Beckham have reportedly purchased a Miami Beach mansion for a posh $60 million.
The couple’s rumored new stateside “Beckingham Palace” features 9 bedrooms, as well as the run-of-the-mill pool, spa, gym, and cinema that come almost as standard among the area’s sprawling waterfront estates. Whether it will hold its value, even with all of those amenities, is another question altogether.
Indeed, the annual UBS Global Real Estate Bubble Index for 2024, which analyzes residential property prices in 25 major cities worldwide, revealed that Miami’s soaring housing market had the highest bubble risk with an index score of 1.79 — beating Tokyo and Zurich for the top spot.
The score is calculated as a weighted average of several factors such as price-to-income and price-to-rent ratios, economic distortions like lending and building booms, and prices in the city compared with the rest of the country. As such, it serves as an indicator of how likely it is for a region’s housing market to be in a price “bubble.”
While UBS noted that Miami’s booming housing market has “cooled somewhat” due to higher mortgage rates, prices are still rising. In fact, Miami homes are now almost 50% more expensive than they were at the end of 2019, significantly outpacing income and rental growth over that period.
Per the report, price inflation has been fueled by wealthy households vying for the city’s few upmarket oceanfront properties. They’ve been drawn in by Miami’s new position as a financial hub, relative value compared to NYC and LA properties, warm weather, and — of course — low tax rates, with the 1% (or 0.1%) potentially saving millions on not paying any capital gains, state income, or estate taxes in the state of Florida. It follows, then, that Miami’s millionaire population has grown by 75% over the past decade, with the lavish West Palm Beach area alone seeing an increase of 90%.
Insurance and Condo Inspections were already killing real estate in Florida, and now 2 hurricanes. It’s going to be a bloodbath there, just like 2008.
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