BUILD Q1 2023 4 News alor Capital Doubles Down on Tampa Bay Luxury Real Estate. Demand in the luxury real estate market remains strong as affluent buyers see real estate as a solid investment during inflationary times. Rising interest rates have reduced the number of houses on the market as sellers opt to stick with their existing lower-interestrate loans. Valor Capital’s Moises Agami explains why the luxury real estate market remains strong. After months of heavy stock market declines, rapid inflation, and rising interest rates, it can be hard not to see doom and gloom on the horizon. Even as average national real estate prices are 13% higher year-to-year, some economists cite the sharp drop in transaction numbers over the past 12 months and reduced construction spending since August as evidence the housing market is in trouble. Moises Agami and Valor Capital are holding tight to historical trends and current realities. The luxury real estate market in Tampa Bay is weathering the storm. While many macroeconomic factors are concerning, real estate performs differently according to location and asset class. For example, while real estate prices across the nation rose 13% last year on average, in Tampa and Miami, that increase was 28% (continuing the Florida real estate explosion), and Charlotte, North Carolina, saw a 21% rise. Some observers are saying that the reduced number of property transactions represents a lack of demand. Still, a closer look reveals that rising interest rates and other economic factors are contributing to diminished supply. “The slowdown in trade speaks to SUPPLY rather than demand,” says Valor Capital’s Moises Agami. Rising interest rates and limited inventory deter homeowners from selling if they can avoid it. Prices are higher, and their current mortgage is likely locked in at a lower rate than they can get today. It makes sense to stay rather than sell and find a new home, and some sellers have taken their properties off the market, thereby reducing inventory. This is particularly true in the luxury housing market and families with a primary residence valued at $10 million or more. Realtors in the Hamptons and New York City see ultra-luxury buyers waiting patiently as inventory is low. Fewer homes are purchased because there are fewer for sale. Valor Capital’s luxury condominiums in Clearwater, Florida, are selling at the highest and second highest price per square foot in Pinellas County on the Gulf Coast of Florida. While Luxury Real Estate May Be This Economy’s Best Investment V Valor Capital sees fewer showings, absorption of their luxury condominium designs remains high. Agami says, “A thorough evaluation of the present time, as well as our history in the past few decades, points to the fact that interest rates will rise and likely settle down around our historical average of 7%.” Moises Agami goes on to say, “There is no real estate crisis. There is an inflationary crisis, which means all goods, services, and assets are going up in value. When investors and consumers realize this, they invest heavily in real estate to protect their money from the depreciation caused by inflation.” Moises Agami’s background prepared him with valuable lessons for counteracting the effects of inflation and supply issues. He says, “I have a background in supplying vehicles and parts to dealerships and manufacturers around the world — a very rigorous process where cars always have to arrive just in time. The supply chain had to be impeccable ALL THE
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