Why Miami’s Real Estate Market Is Poised For Opportunity In 2025 And 2026

Miami’s Real Estate Market Set for Change

Miami’s real estate landscape is poised for significant shifts in the coming year, driven by falling interest rates, strong economic growth, and favorable demographic trends. With increased liquidity in the debt market and diminishing private credit returns, investors are likely to refocus on real estate equity. As borrowing costs decrease and construction expenses stabilize, many investors are eager to re-enter the market.

Economic and Demographic Growth

South Florida is experiencing notable population, job, and wage growth. Since the pandemic, Miami has attracted high-paying jobs and skilled workers, leading to a 2.9% increase in private-sector jobs in August 2024—significantly higher than the national average of 1.4%. Brickell’s ZIP code 33131 boasts the highest mean household income in Downtown Miami at $185,585.

Demand for Commercial Space

The demand for commercial real estate remains robust, with Class A office vacancy rates down 1.1% year-over-year. Brickell’s average asking lease rate hit $99.40 per square foot, reflecting a 5.8% increase. Significant transactions, like JP Morgan’s office expansion and Elliott Investment Management’s acquisition of the 701 Brickell tower, underscore this trend.

Multifamily Sector Opportunities

The slowdown in new residential developments presents unique opportunities in high-demand areas. For instance, the downtown Miami/South Beach multifamily submarket reported effective rents of $3,286 and a 95.5% occupancy rate in Q2 2024. With limited new supply, existing properties in Brickell and the Roads corridor are becoming increasingly attractive.

Global Investment Interest

Miami’s appeal is bolstered by an influx of investment from various states and countries, driven by its strategic position as a gateway to Latin America and its lack of state income tax.

Looking ahead, Empira Group plans to launch two Class A multifamily projects soon, with expectations of strong rental growth by 2026-27, reinforcing confidence in Miami’s long-term residential real estate potential.

Source: SFBJ