Condo hotels are one of the hottest products in today's real estate market. New properties are cropping up in dissimilar parts of the country and new buyers are entering the store daily. Things have been intelligent so quickly in terms of condo hotels, but sometimes it's worth taking a occasion to step back and look at the big picture.
Condo Hotels In General: There is a spreading enthusiasm about the condo hotel concept. More population are recognizing its potential and therefore creating question for more inventory.
Miami Beach Hotels
Condo Hotel Buyers: The midpoint buyer is 35-50 years old. Buyers for Florida properties, where condo hotels are most prevalent, come from all over the U.S. On the international front, most foreign buyers concerned in U.S. Property are from South America and Europe.
The vast majority of buyers want condo hotel units primarily as investments and are focused on the potential for appreciation with the side advantage of hassle-free ownership. They see the quality to unquestionably use their condo hotel unit as a vacation home as important but secondary to their goal of speculation diversification.
Condo Hotel Market: Virtually every single Property that has come on the store to date has sold out in pre-construction. Most of these properties are mega high-rise structure with on midpoint 200-500 units, and with some in excess of 1,000 units.
The speed with which these properties sell out is often as surprising to buyers as it is to the developers themselves. For example, the Mgm Grand in Las Vegas, a 576-unit condo hotel, was expected to sell out in two years. It sold out in two months! The Platinum, a 255-unit Property in Las Vegas, also sold out in just a matter of a combine months.
Hot Areas: South Florida continues to be an highly favorite area and one that has shown strong and steady appreciation. As already mentioned, the condo hotel trend which began in South Florida has now spread out west. Las Vegas is important the pack with many new condo and condo hotel developments in all price ranges being built.
Growth in Florida: seeing at South Florida, it's easy to see what is happening. Miami Beach, the hottest area, is all built up. There just isn't any undeveloped land. That's causing a combine of things to happen. Developers are heading to the northern end of Miami Beach (North Beach) and areas still additional north such as to Sunny Isles and Ft. Lauderdale.
A new trend is developers buying existing structures in Miami Beach and whether upgrading them, as in the case of The Mimosa which was the previous Brazil Motel, or knocking them down and starting over, as in the case of One Bal Harbour in which a multi-family, high-rise building (Harbour House) was demolished and a five-star condo hotel built in its place.
Finally, some properties are starting to crop up inland. These condo hotels may not have oceanfront views; however, they're within a few short blocks of a beach. Because they're not on the ocean, these properties tend to be priced more economically.
Properties: The most favorite properties continue to be those with a franchise name, one that brings a reputation for four- to five-star quality or a name that is already well-known. A prime example is Canyon Ranch Living in Miami Beach. population recognize the Canyon Ranch name and feel inescapable that this Property will be of the same five-star caliber as its Arizona counterpart. Of course, it doesn't hurt that this Property will have a 60,000 sq. Ft. Rooftop spa and fitness center.
The Selling Process: A lot of properties take reservations of more than half the total scheme long before they've even prepared their purchase contracts. This means that many of the best units are reserved months before any money changes hands and often before even the first spade of ground has been turned over. Those early investors are seeing some astounding appreciation on their investments.
Prices: Like anyone for which there is more question than supply, prices keep going up, up, up. Developers often raise their prices 3-5 times from when they start selling until they sell out.
Developers are no longer discounting prices at the starting of the selling process when they are anxious to get a few sales under their belt. This used to be common practice; it is no more because question is so great.
There are sometimes, however, some price adjustments made at the very tail end of the sellout phase when developers want to close out their Property and move on to their next project. generally speaking, with regard to price, the best time to get in is ordinarily early on in the first pre-construction offering.
Quality: Most condo hotels being built are of four- to five-star quality. The presume is two-fold: 1) There is question for the types of services in case,granted by four- and five-star properties, and 2) Oceanfront land is so high-priced that it makes more sense for the developer to put in a luxury Property with units that he can sell at a premium price rather than lower priced units.
Financing: It's getting a exiguous easier to get condo hotel financing. There was a time when most banks and mortgage fellowships weren't even familiar with the term condo hotels. They now know it and also recognize the viability of these properties. They are more accommodating in expediting these loans.
Contracts: Contracts that allow assignability have come to be rare. In the past, at some properties buyers could place a deposit on a unit in the pre-construction phase and then flip their unit prior to when they had to close. Developers now want to be sure that they don't compete to sell their last few units with investors who purchased early at pre-construction prices and are now re-selling them at below the developer's current prices.
Resales: Some condo hotel unit resales come on the market. Of course, this is to be expected. Some of the earliest buyers now want to move on to something or somewhere else. However, the resale store is still relatively small, and it's hard to find a bargain.
Advice to New Buyers: How can buyers choose a condo hotel unit that will be a good investment? It's best if they can work with a real estate broker who specializes in condo hotels and can make them aware of all products on the market. Aside from that, they should look for the following elements:
Location: Real estate is all about location. Beachfront properties in South Florida have done exceptionally well in modern years. Their appreciation has been significant. If you prefer a Property that is not on the ocean, it's a good idea to settle on one in an area where you can expect to have company driven to your property, such as near a major practice center or in uptown Miami near the financial district.
Franchise: It's all the time safest to go with a major company, familiar internationally. Four Seasons, Hilton, Starwood, Rosewood, Setai and Trump are exquisite examples. Ask yourself, would you likely stay in a Holiday Inn for or the independent hotel over the street for ? Many investors or hotel guests will pay a exiguous more for the relieve level they get with a well-known, well-respected franchise.
Management Company: compare the supervision fellowships and their rental sharing program. You will likely feel more comfortable investing your money in a condo hotel with an experienced, top-notch supervision company vs. An independent operator. Also, it's worth noting that an established supervision company does worldwide marketing and likely has a state-of-the-art reservation ideas that will help ensure your unit is rented as much as possible.
Condo Hotel Trends - A Look at the Big photo in Vacation Home proprietary