Cost of Vacant Lots, New Construction Homes in Broward County Continue to Soar

It’s not unusual for Broward County real estate to sell for $1 million, but for the first time, new constructions in both Miramar and Pembroke Pines are being built for that price, according to today’s Sun-Sentinel.

The reason is simple. Land. With so few vacant parcels left, the price of a lot has risen to 40 percent or more of a home’s overall price — up from 25 percent as recently as 2000. South Florida housing market shoppers still want the newer construction, and apparently, they’ll pay more for it.

“This is what happened with land prices in California, and this is what is happening now in South Florida,” said Florida real estate analyst David Dabby of the Dabby Group.

Two of every three cities in Broward County had at least one home sell for $1 million or more in 2005, according to the office of the property appraiser. Real estate analysts say they expect the number of such sales to continue growing, but Broward isn’t only for the wealthy, as 27 of the 31 cities in the county saw single-family homes sell for $200,000 or less.

Municipalities without $1 million home sales in 2005 were Lauderdale Lakes, Lauderhill, Oakland Park, Tamarac, Sunrise, Margate, N. Lauderdale, West Park and Pembroke Park. Combined, they account for 41 percent of the total sales last year of homes costing $200,000 or less. Homes in that range are considered a bargain in a county with a median price of $360,800.

Missing from the list of cheaper cities are the beachfront communities of Hillsboro Beach, Lauderdale-by-the-Sea and Sea Ranch Lakes. Absent from both lists, meanwhile, was the tiny town of Lazy Lake, a two-street enclave surrounded by Wilton Manors. Million-dollar homes in Pembroke Pines and Miramar would have been unheard of just a few years ago, before double-digit appreciation caused the South Florida housing market to skyrocket.

Yet at Sunset Falls in western Miramar, 18 buyers so far have plunked down $1 million or more for new houses. The subdivision includes 491 properties around a 375-acre lake, among the county’s largest. More than half of the homes have been sold, with prices starting around $600,000.

“The bottom line today is if you want to be in west Miramar, which is so up and coming, and you want a brand new home, this is where you can go,” said Rooz Eslahi, 28, a licensed real estate agent, who lives with his 16-year-old brother and is buying one of the units.

For all the talk of the South Florida market losing steam, ever-increasing property insurance premiums and rising Florida home loan costs pricing people out of the market, there still seems to be significant demand in some areas. Hopefully this will continue to fuel the region’s economy and a soft landing can be achieved.