Luxury homes in South Florida have been selling like hot cakes – mostly because mansion taxes and the capping of SALT deductions have pushed many from Mid-Atlantic and Northeast states to the tax-friendly environment of Florida.
“I’ve been selling real estate for 34 years,” said real estate broker Rob Thomson, a Mar-a-Lago club member and the owner of Waterfront Properties & Club Communities, who spoke with Bloomberg. “This is the longest bull run of my career.”
He said mansions, small homes, and empty lots have been in high demand, thanks to the state’s income tax rate of 0%, along with the region’s vast amount of wealth.
Thomson said while the Miami Metropolitan Area, from Miami to West Palm Beach/Palm Beach, is booming – there’s a section of residential real estate — within a ½ mile of President Trump’s Mar-a-Lago Club that has gone cold.
Ten homes remain unsold within a four-block radius of Mar-a-Lago have been sitting on the market for an extended period.
One of the properties is located at 1090 South Ocean Blvd. has been listed since 2016; with a listing price of $6.95 million, according to Zillow, down 26.5% from an initial $9.5 million. Four other listings have been sitting on the market since 2018; seven have already seen significant reductions in price.
There’s certainly a cloud of negativity over properties close to Mar-a-Lago – it’s a massive contrast to the eight luxury Palm Beach homes that sold in 4Q19, with an average listing time of 191 days, said Douglas Elliman Realty LLC.
“The fact that they’re all being marketed at the same time, nearby, is not natural,” said Jonathan Miller, the CEO of Miller Samuel. “A cluster of listings, especially at the high end, is not likely to reflect a positive condition” in the market.
Brokers in Palm Beach had different explanations for the unsold homes around the resort, and all said it did not correlate with the president.
Paulette Koch, a broker with Corcoran Group, said the listed homes around the resort are “all coincidental,” adding that, “you can get a group of people who all want to sell [at once] for varying reasons.”
One broker said Trump’s constant appearance at his resort is nothing but positivity for the region. Jeff Cloninger, a broker for Sotheby’s, said the benefits of the president in Palm Beach is the added security.
Another pointed out that homes around Mar-a-Lago are directly under a flight path of planes, and noise is so loud, it has deterred many from buying houses near the resort.
Miller has a different explanation for the unsold homes: “It’s not uncommon to have clusters of people around a celebrity or notable name trying to cash in. In other words, Trump might not be a deterrent, but he also might not be the draw they think he is. It’s more about these listings being overpriced.”