With its influx of corporate titans, Miami’s real estate values soar
South Florida real estate has been on the tongues of nearly everyone lately, whether it’s prospective homeowners bemoaning prices or real estate agents sending out gloomy fore- casts about the shrinking inventory. Housing affordability in South Florida is now a concern for all income levels except for the latest influx of home buyers – the ultra-wealthy, the centi-millionaires, and the billionaires.
Miami is the fastest-growing wealth hub in the United States with the number of millionaires increasing by 75 percent from 2012 to 2022. A 2023 USA Wealth Report claims Miami is now home to 160 centi-millionaires, with the city ranking at number one in the top U.S. locations where millionaires are buying homes (West Palm Beach follows at No. 3 and Boca Raton at No. 10).
And then there are the billionaires, like Jeff Bezos, who just spent $150 million on two adjoining properties in Indian Creek Village, a wealthy island community north of Miami Beach that is also home to Jared Kushner and Ivanka Trump. He also recently bought two neighboring homes in the leafy Coral Gables suburb for his parents, Jackie and Mike Bezos, for $34 million and $44 million.
Ken Griffin, the czar of global hedge fund Citadel, waded into the South Florida real estate scene after moving his company’s headquarters from Chicago to Downtown Miami last year. Griffin paid $106.87 million for a historic estate in Coconut Grove, purchased from Miami philanthropist Adrienne Arsht. She had originally purchased the two properties comprising the estate for $4 million in 1996, and for $12 million in 2007.
“The growth is just super intense,” says Liz Hogan, a luxury real estate agent for Compass who specializes in custom estates for millionaires. “It’s just scarcity. If you have such extreme wealth and there’s a bidding war on a $10 million home, to plunk down $12 million is nothing – you’re probably saving $5 million in taxes just to move [to Florida], so what do you care if you pay an extra $2 million? And then the next guy comes and pays $13 million, and then the next person.”
Mostly coming from California and New York, these uber-wealthy buyers are driving out locals who can’t afford to get into bidding wars with centi-millionaires or billionaires. The new buyers are often high-profile attorneys, successful entrepreneurs, or high-level executives at tech firms, looking to South Florida for lower taxes, better quality of life, and waterfront living. Some are simply looking to diversify their portfolios but not actually moving here, though Hogan says those are in the minority.
“From what I’ve seen, my clientele all come to live here permanently,” she says. “I don’t know if they’re living here full-time because they can afford second homes somewhere else, but the majority of them are staying.” Those who aren’t, are buying anyway because “they really believe in the market and where it’s going.”
The city of Palm Beach has also emerged as a hotspot for some of these uber-wealthy clients. In the third quarter of this year, the average sale price of a home in Palm Beach topped $20 million, with an average price per square foot reaching $4,554, more than two-and-a-half times that of Manhattan’s. This past summer, entrepreneur and investor Harvey Jones bought a Palm Beach mansion for $50 million; it had previously sold for $7.37 million. In Miami Beach, meanwhile, the average price of “luxury properties” – for $10 million or more – surged to a record $25 million.
Hogan says it’s not just those neighborhoods that are seeing record sales, though. “South of Brickell is extraordinary,” she says. “It’s the families looking for private schools because the majority of those are all down south of Brickell. And Coconut Grove is really the next hotspot… It seems to be a great melding between suburbia and urban.”
Waterfront areas are a major draw for out-of-state buyers, and these prices are soaring. In October, David R. Rodriguez, the former CEO of Amicus Medical Group, purchased an oceanfront property in Golden Beach, just north of Miami Beach, for $29 million. It last sold for $6 million in 2011. Also in October, a company owned by attorney and CEO John Ruiz purchased a waterfront home in Coral Gables for $22 million. It had previously sold in 2019 for $10.88 million. An even steeper hike took place in the same month, when an empty bayfront
lot in Coconut Grove was purchased by a Colorado company for $18 million. It was last purchased in 2021 for $5.75 million, when it had a house that was subsequently torn down.
When the high end of South Florida real estate will cool off is anyone’s guess. Hogan says the luxury market in South Florida will remain strong in the coming years as more and more high-profile buyers join the ranks of others moving here for tax and lifestyle reasons. According to the U.S. Census Bureau, last year Florida became the fastest-growing state in the country for the first time since 1957. According to the University of Florida, by 2030, Miami-Dade County alone will grow by more than 200,000 people from its current population of 2.76 million.
