Bal Harbour-Surfside-Bay Harbor Islands Market Struggles With 10-Month Supply Of Rentals Listed For Lease During COVID-19 Pandemic

Tenants Paid $2.03 PSF Monthly For Residential Rentals In Bal Harbour-Surfside-Bay Harbor Islands In First Half Of 2020 

(This Report Is Powered By The Condo Vultures® Podcast Series Featuring Expert Peter Zalewski

DOWNTOWN MIAMI (Sept. 1, 2020) - Nearly 400 residential rental properties are formally listed for lease in the Bal Harbour-Surfside-Bay Harbor Islands market of the South Florida county of Miami-Dade during the COVID-19 pandemic, according to a new report from Condo Vultures® Realty LLC.

Based on completed leases of about 39 residential properties monthly in the first six months of 2020, the Bal Harbour-Surfside-Bay Harbor Islands area now has more than a 10-month supply of rentals - apartments, condos, efficiencies, multifamily and townhouses - available in the tricounty South Florida region of Miami-Dade, Broward and Palm Beach during the traditional Summer Buying Season, according to the report based on data from the Southeast Florida MLS Matrix. 

A balanced market is generally considered to have about six months of supply. More months of supply listed for lease suggests a tenant’s advantage and less months typically indicates a landlord’s advantage in the market. 

In this new COVID-19 pandemic era, numerous questions exist about how the South Florida residential real estate market will perform going forward, both in the short- and medium-term periods. After a typical start to the new year, the South Florida residential real estate market began to change dramatically at the end of the first quarter of 2020. 

When Florida Gov. Ron DeSantis declared a "state of emergency to create a pathway to obtain funding and resources to stop the spread of COVID-19" on March 9, 2020, the South Florida residential real estate market continued to function, albeit with changes for safety that included social distancing and a push for virtual tours instead of buyer actually visiting properties.  

Nearly a month later on April 3, 2020, DeSantis instituted a 30-day "statewide stay-at-home order" that effectively shut down the Florida economy but in doing so deemed residential and commercial real estate businesses "essential services," according to an industry press report.

Despite the ability to transact real estate during the "stay-at-home order," it is unclear how many buyers have been willing to view properties - either in person or virtually - in hopes of purchasing residences. It is also unclear how many sellers have opened their properties to potential buyers given the contagiousness of the COVID-19 virus. 

Once the "stay-at-home order" was finally lifted on May 4, 2020 for nearly all of the state - excluding the tricounty South Florida region of Miami-Dade, Broward and Palm Beach - the Florida economy was thought to be in recession like much of the United States. Palm Beach County eventually opened its economy on May 11, 2020, and a week later both Miami-Dade and Broward counties opened for business on a limited basis on May 18, 2020.

A month later during the week of June 22, 2020, Miami-Dade and Palm Beach counties instituted mandatory mask wearing in public areas in response to a "spike" in the number of COVID-19 cases in the South Florida region, according to a press report. 

Broward County - located between Miami-Dade and Palm Beach counties - recommended but did not mandate masks be worn in public areas.

After Independence Day, Miami-Dade County took a step backward and shut back down restaurant dining rooms, party venues, gyms and short-term rentals due to a spike in new COVID-19 cases, according to a press report.    

With the situation worsening, the state of Florida surpassed New York on July 12 for the distinction of having the most new COVID-19 cases reported in a day with more than 15,300, according to a press report.  

A day later on July 13, an additional 12,624 new cases were reported in Florida, pushing the state number of COVID-19 cases to at least 282,435 with more than 121,000 cases in the tricounty South Florida region. On a county-by-county basis, Miami-Dade had nearly 67,715 cases, Broward had nearly 31,485 cases and Palm Beach had more than 21,800 cases, according to a press report. 

As of July 24, Florida had more than 402,300 confirmed cases of COVID-19 with nearly 5,700 deaths, according to the Florida Department Of Health's COVID-19 Data And Surveillance Dashboard. 

On that same day, the tricounty South Florida region had about 172,440 confirmed cases - representing about 43 percent of the Florida total - and about 2,660 deaths - representing about 47 percent of the state total, according to the state dashboard. 

As of Aug. 31, the COVID-19 pandemic had resulted in nearly 623,500 confirmed cases and nearly 11,200 total deaths in Florida. In the tricounty South Florida region, there were more than 267,850 cases and about 4,740 deaths, according to the state website. 

On a county-by-county basis, Miami-Dade had nearly 155,700 confirmed cases and more than 2,435 deaths; Broward had more than 70,550 confirmed cases and nearly 1,185 deaths; and Palm Beach had more than 41,600 confirmed cases and nearly 1,120 deaths, according to the state website. 

In an encouraging step, Miami-Dade County joined Broward and Palm Beach counties in once again permitting restaurants to allow indoor dining at levels of up to 50 percent of the seating capacity as of Aug. 31. The move in Miami-Dade County was based on a leveling off in the number of new COVID-19 cases and pandemic-related deaths, according to a press report.   

This being said, about 47 rental properties are currently under contract - or pending - and waiting to transact at a median monthly asking price of $2,150 per unit or about $2.22 per square foot in the Bal Harbour-Surfside-Bay Harbor Islands area. 

The median asking price of a Bal Harbour-Surfside-Bay Harbor Islands residential rental property currently listed for lease is about $3,363 per property monthly. This works out to a median asking price of about $2.77 per square foot monthly, according to the data compiled by CondoVulturesRealty.com. 

In the first six months of 2020, the median transaction price of a Bal Harbour-Surfside-Bay Harbor Islands residential rental property was about $1,963 or about $2.03 per square foot monthly, according to the data. 

This means the current asking price of a Bal Harbour-Surfside-Bay Harbor Islands residential rental property listed for lease is about 71 percent higher than the median transaction price achieved on a monthly per-property basis and nearly 37 percent higher than the median transaction price achieved on a monthly per-square-foot basis between January and June of this year. 

In the first half of 2020, landlords needed 54 days - on a median basis - to lease a Bal Harbour-Surfside-Bay Harbor Islands residential rental. The current median Days-On-The-Market rate for a Bal Harbour-Surfside-Bay Harbor Islands residential rental property listed for lease is 92, according to the statistics. 

The number of Days-On-The-Market for the residential rental properties currently under contract is about 62 in the Bal Harbour-Surfside-Bay Harbor Islands area, according to the statistics.

CondoVulturesRealty.com is a licensed Florida brokerage that specializes in assisting buyers and tenants in value-oriented acquisitions of condos in the tricounty region of Miami-Dade, Broward and Palm Beach.

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