By Mike Colpitts
Rising home and condominium prices in isolated markets scattered across the U.S. rarely develop into a sudden real estate recovery, but demonstrate the differences of local housing markets.
For the first time in years the average prices of homes and condos in Miami moved higher in July, showing that even in downtrodden Miami, once the proverbial epicenter of the real estate crash prices can get so low that somebody comes out to buy.
In Miami’s case, most of the market’s strength is from foreign buyers, which won’t help the housing market much in say Peoria, Illinois once a vast test market for home products in the 1960’s.
The power behind home sales in a place like Miami is the resort market, its unique ability to attract tourists from all over the World with the Key Biscayne Waterfront, thousands of restaurants serving everything from Cuban food to Mojitos at the corner bar, a diversified cultural experience and plenty of hard bodies on the beach.
For some reason you don’t see girls in skimpy bikinis in the corn fields outside of Peoria.
Along the art deco district of South Beach, the center of Miami nightlife the casual visitor would hardly know there was an economic downturn. A few businesses are closed, and down the side streets there are homes that show signs of being foreclosed. But the busy tourist trade still serves the Miami area well.
Like in California’s Silicon Valley, you almost have to be a local to detect that hard times are being felt all around South Beach, but then again isn’t that the way it’s supposed to feel like in a vacation paradise?
In South Dakota, North Dakota and Iowa cities housing markets that weren’t affected by the real estate bubble as much are seeing slow but steady growth in home prices. Housing markets are all different and are dependent on local market conditions.
In Miami, the vacation destination for millions of tourists, it’s all about having a good time and that’s what resort real estate markets offer. Miami after all isn’t Peoria.