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Searching for Sunshine

Florida

Sometime in the decade of the 1980s, the perception of the Florida lifestyle changed. The land of sunshine became the land before the final rest. The "Gold Coast" turned into the condominium coast. The glitz and glamour gave way to drugs and crime.But slowly after the crash of the real estate market in the early 90s, a new Florida has emerged… less reliant on retirees less honky-tonk... much more international, trendy. Here is the first of two parts on the resurgence of Florida real estate.

By Karen Curran
GLOBE CORRESPONDENT

BOCA RATON - Florida real estate, like that in Massachusetts, has very much been the beneficiary of recent successes on the stock market since 1993.
However, dollar-for-dollar, the average home costs less in Florida. The 1996 Florida median existing home sales price of $91,800 is still 27 percent lower than the US $126,500 median price, and less than half the price in Massachusetts at $189,300.
According to the University of Florida's Bureau of Economic and Business Statistics, approximately 1.2 million people moved to Florida from other states and foreign countries between 1990 and 1996. That is more than 500 new residents a day. About 7 percent of those new residents relocated from Massachusetts, about 15,000 persons a year. (And this excludes those who purchase homes in Florida but retain primary residence in Massachusetts.)
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The Florida home market, however, is complex.
Prices vary dramatically depending on location and distance from the ocean. Homes located along Route A1A on the narrow peninsula that runs between the Atlantic ocean and the intracoastal waterway from Jacksonville south to Miami Beach are the priciest.
On the other end of the spectrum, older condominiums located west towards the Florida Turnpike can be bought for as little as $10,000. Brand new homes in lovely golf course communities start at around $200,000.
Not since Dade Country hit a high of 15,000 unsold condominium units in 1986, has there been such an explosion of new condominium development in the Miami area. Beginning in 1994, more than 30 condominium developments containing more than 6,000 units have been constructed along the intracoastal waterway in Dade County.
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According to Appraisal & Real Estate Economics Associates Inc., 6,575 new condominiums were purchased in Dade (72 percent), Broward (19 percent), and Palm Beach (9 percent) counties in 1996, a 3 percent increase over 6,399 sales in 1995. More than 9,000 new condominium units are projected to be available for sale in l997.
What is fueling this unprecedented growth?
Developer Brian Street said that five. years ago there wasn't a condominium being built on Miami Beach. Now it's wall to wall condominiums, and they are being absorbed by the one market that not one of the experts foresaw, the foreign market.
"I think that south Florida is at the threshold that Los
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Angeles was in the 1930's, when it became the gateway to the Pacific Route. Miami is already the gateway to Latin America. All of those indicators that tell you in 20 years you will have an absolute boom on your hands. Look at Argentina and Brazil. Look at the size of those markets, they are vast. They have to hub through Miami, and Miami speaks their language," said Street.
If you want proof the stock market has been good for Florida's real estate, drive A1A from Boca Raton north to West Palm Beach. In a half-mile section, there were six homes under construction exceeding $3 million each.
On the Boca Raton-West Palm Beach corridor, all of the homes along the ocean are in the $3 million to $10 million dollar range.
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Palm Beach is a quiet community where a host of celebrities don't want to be bothered. Palm Beach is old money; Boca is new money. Worth Avenue in Palm Beach is believed to be one of the most expensive shopping strips in America. The highest sale in Broward County was $5 million. "They are still far, far, far from Palm Beach," sums broker Michael Mayer.
Interestingly, an article in the September issue of Barron's identified Palm Beach County, including West Palm Beach and Boca Raton, as the only US housing market currently
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underpriced besides Fort Worth, Texas. Based on a model developed by the Local Market Monitor in Wellesley, Barron's concludes that the 37 percent change in the median home price in Palm Beach County between 1986 and 1996, leaves the home market approximately 10 percent undervalued.
According to the Florida Association of Realtors, sales of existing single family homes, excluding new homes and condominiums, were up 6 percent between 1994 and 1996.

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