Record apartment sale in Little Havana another sign of Miami’s rising rents
Post on April 17, 2015 by The Victoria Law Group 0 Comments
As landlords seek profits, apartment buildings in Miami’s poorer neighborhoods are trading at a hectic pace. That means higher rents for residents.
East Little Havana, long a home for working-class families, is high on investors’ lists thanks to its proximity to Miami’s surging downtown. But as new owners renovate old buildings, locals are being forced out to cheaper parts of town, further from their jobs.
A case in point: On Thursday, a small, two-story apartment building on Little Havana’s gentrifying eastern edge sold for $855,000, or $205 per square foot. That’s a record square-foot price for a building in Little Havana built before 1980, according to brokerage Avison Young, which handled the sale. The five-unit building, at 553 SW Third St., dates to 1979 and lies just across Interstate 95 from Brickell, where condo and office towers are rising. It offers large two- and three-bedroom apartments.
The high price was partly the result of extensive renovations performed by the previous owner, a company called Summit 312 553 that through affiliates owns at least eight apartment buildings around Miami.
In 2014, Summit redid the units, replacing kitchens, bathrooms and adding tile floors, said broker Rafael Fermoselle of Avison Young. After the renovations, the landlord raised rents between 30 and 50 percent, to roughly $1,250 per month for two-bedroom units and $1,500 for three-bedroom units.
Only one of the five families living in the building was able to afford the higher rate. The others moved out.
“A lot of the owners in Little Havana don’t realize how strong the rental market is,” Fermoselle said. “Investors really see the value when they come in and invest $8,000 to $9,000 per unit and get the younger millennials who can’t pay Brickell prices but want to live close by.”
Real-estate website Zillow puts the average rent in Little Havana at about $1,520 per month, up more than 9 percent over the last year. In Brickell, rents have soared to $2,450, Zillow found.
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Presented by Miami Business Attorney