Gentrification, which helped tame Miami's gritty arts and design districts, has been followed by luxury shops including Hermes, Cartier and Christian Louboutin. The storefronts have brought a glossy finish and valet parking to once-empty showrooms - and forced some independent art fairs and pop-up events to relocate during this year's annual Art Basel Miami Beach revelries.
"We're more of a luxury destination than we used to be.'' said William Talbert, president and CEO of the Greater Miami Convention and Visitors Bureau. ``Why they're being built is because of the international customers - this is what they want.''
The good times have sparked questions about how long money from abroad can support the area real estate and its economy. In a survey of 42 real estate experts, 69 per cent identified Miami as facing risks of a bubble within five years, according to the real estate data firm Zillow.
Developers downplay the risk, noting that cash, rather than debt, is driving most of the purchases. And Miami has one advantage that should help it continue to draw wealthy buyers: No state income taxes. It helps give Miami an affordability edge over California and New York City where international buyers also cluster.
Someone who earns $1 million in Florida pays about $100,000 less in taxes than in New York City, noted Carlos Rosso, an executive with the Related Group, a developer. Those tax savings add up to nearly the equivalent of a yearly mortgage payment on a multimillion dollar home.
"That's why people are moving here; they can get a $3 million house for free,'' Rosso said.