Release Date: October 5, 2006

REALTOR® O. Kheir, CDPE Notes that Remodeling Helps Push Prices Upward

Daytona Beach Shores, FL - Luxury upgrades like custom appointments including travertine floors and granite countertops push oceanfront prices up. REALTOR® O. Kheir, CDPE , a multi-million dollar producer with RE/MAX Signature in Daytona Beach Shores, FL points out that it does — and says these appointments are partly responsible for escalating oceanfront condo prices in the past five years.

In ongoing email newsletters and website updates, Kheir notes that his customers’ spending for improvements on condos has greatly increased and that it will likely continue to rise, despite the temporary slowdown in home sales and prices reported earlier this week by the National Association of REALTOR®s.

Valuation of oceanfront condo properties can be tricky because owners’ improvements often aren’t noted in public records or the Volusia County Tax Appraiser’s office. Kheir estimates that condo remodeling is responsible for just a portion of the price appreciation each year. Owners want to upgrade their condos to reflect the luxury appointments at their primary homes - home theaters, humidors, wine closets, and summer kitchens.

Kheir notes that most of his customers buy direct oceanfront condominiums as second homes, vacation properties and since many are baby boomers, they buy their dream homes now while the market is taking a short break. Inventories of existing condos have risen sharply in the past few months; however, Kheir continues to write contracts on pre-construction condos at record pace. In the past month, Kheir inked another deal that will close in the early part of 2007 - a direct oceanfront three bedroom, three bath condo with over 2000 square feet for under $750,000. While older condos may initially cost less per square foot, they are more likely to need the luxury appointments that today’s affluent buyers desire.


In the past two years, Kheir has closed several deals in Daytona Beach, Ormond Beach, and Ponce Inlet that involve 1031 Tax Deferred Exchanges and Self-Directed IRA holdings. Today’s savvy executives have learned to leverage real estate using creative financing and are looking long term for a chance at substantial appreciation, and a chance to own a piece of the beach.

The direct oceanfront condo marketplace is like none other. With entry level converted hotel suites that start at under $100,000 to multi-million dollar condos that are bigger than many homes (4000+ sq feet), there is a view of the Atlantic Ocean, or the Intracoastal Waterway for anyone who desires to live the island lifestyle.

So, while national real estate prices overall may continue to decline due to overbuilding, speculation and risky mortgages, remodeling oceanfront condos and buying pre-construction properties continues to be a very viable option. Kheir predicts that the excessive inventories of older oceanfront condos will be depleted due to several factors - a slow hurricane season, low interest rates, motivated sellers and a potential of a harsh winter.