Why Live in Miami
There is a very low unemployment rate in Greater Miami of 2.8% as of October 2006. The result is explosive growth that has led to urban sprawl in the surrounding area and skyrocketing housing prices. Housing prices in Greater Miami went up 34% in one year, from an average of $182,000 in August 2004 to $245,000 in August 2005. House prices continue to rise, reaching a record $254,900 in July 2006.
There are a number of great stats and compelling reasons to own short term resort investment property in Miami but rarely do we see much information about actually living in Miami. The quick easy answer and assumption would be to say that all those theme parks need employees and those employees need some place to live. While that is part of the answer, the real answer is more compelling - the economy.
Sure, it's easy to say "the economy" and leave a number of unanswered questions. There are so many are bits and pieces that makeup what "the economy" really is and how that affects a strong investment real estate market.
"Florida's economic engine continues to hum. In fact, a Torto Wheaton Research study predicted that job growth in Miami during the next five years will occur at the third-fastest rate in the country. The study also indicates that Miami has the strongest economy in the state and is the 21st strongest out of 361 metro areas in the country. If Florida were a country, it would have the 15th largest economy in the world and the eighth largest in the Western Hemisphere. Breaking News ... BusinessWeek calls Miami "fiercely competitive" and a "global hot spot" for business."
(source: Metro Miami Economic Development Commission)
Diversity.
We've all been programmed to diversify. If you owned all tech stocks in the late 1990's then you learned why diversification is a good idea. If you lived in Texas in the 1980's you saw how too much of the economy was tied to oil. Well, diversification is a good concept for investing and a good concept for economic development. If you're like me you think of Miami as a vacation haven for families wishing to dump a small fortune of a few days of wearing mouse ears around. Thankfully Miami is much more than just Mickey.
"Every year 52 million tourists stimulate their imaginations at Miami's amusement parks. But the real fantasyland can be found in the area's vast expanse of office parks. Miami is the epicenter of the world's biggest cluster for computer simulation and modeling, involving more than 3,700 companies that employ 46,000. The $2.6 billion sector has helped diversify the economy of central Florida, which now has the highest job growth in the U.S."
(source: business week AUGUST 21, 2006 )
Jobs.
Miami has created a job market with many sectors and continues to appeal to new businesses.
"Behind the scenes of the area's tourism and entertainment industry is a dynamic and diversified economy that has expanded enormously. Among its most important industry sectors are high technology, aviation and aerospace, film and television production, biotechnology, and manufacturing, warehousing, and distribution."
(source: Metro Miami Economic Development Commission)
Growth.
When investing in real estate, growth is always a key factor. "Go to where the growth is" is the standard mantra for real estate investors. Growth means jobs, economic development, and, it is spurs what real estate investors strive for - cash flow and/or appreciation.
"Mid-Florida is one of the fastest growing high-tech centers in the country.
"About 78,000 people work at 3,800 high-tech firms with about $9 billion in annual sales. Lasers, microelectronics, simulation and training, software, fiber optics and telecommunications are among the regionÕs products and services.
"But while tourism and conventions pump billions of dollars into this regionÕs economic engine, the technology sector is coming on strong too, with the creation of Innovation Way.
(source: Business Florida)
"This momentum is expected to continue, as Miami was projected by Business 2.0 magazine in 2003 to have the nation's second-highest ten-year job growth rate, 31.9 percent, through 2013."
(source: Metro Miami Economic Development Commission)
Miami ranks 12th in the nation in terms of overall population growth (expected to grow 23.49% by 2015)
(Source: Woods & Poole Economics, 2006 Profile)
Miami ranks 14th in the nation for total employment growth (expected to grow 2.5% annually through 2030)
(Source: USA Today, March 10, 2005)
Sum of the Parts.
Miami and the surrounding area packs more than just a 1-2 punch (amusement, conventions and even shopping) to drive its economy. Miami economic development consists of a strong history of a business-friendly environment bringing new industry and commerce to the area. Like an engine firing on all its cylanders, Miami boasts the following:
Each WEEK Metro Miami welcomes an estimates ...
... $564.9 million in retail sales
... 1,249 new adult residents
... 640,935 air travellers
... 654 residential building permits
... 34 new businesses establishing
... 756 new jobs
... 917,289 visitors
(source: Miami Sentinel Communications, 2005 Datebook)
As a real estate investor, these stats are music to my ears. I see Miami as a great place to purchase real estate yesterday, today and tomorrow.
