The "hysteria" that surrounds the conversion of rental units to condominium ownership seems to be grossly exaggerated, a survey conducted for the Florida Association of Realtors contends.
The survey was carried out by Barry Hersker, of Hersker & Associates, Miami, and a member of the faculty of Florida Atlantic University. It covered tenants in Miami, Fort Lauderdale, Palm Beach and St. Petersburg-Tampa, where most of the Florida condo conversions have taken place.
In the past decade, elderly renters have been reported to suffer the most from Florida's conversion trend, because many are not interested in buying.
But Hersker said the study showed that "the impact on persons most directly involved when rental units are converted into condominiums -- and I refer to the tenants -- apparently is far less than popularly believed . . .
"The study also clearly indicates that the net displacement effect of the conversions on the supply of alternative rental housing may not be as great as the number of converted apartments might seem to suggest."
The Realtors wanted information on the impact of condominium conversion in Florida on purchasers and tenants who are forced to move. The study showed that the majority of tenant-purchasers (58 percent of the sampling) did have negative feelings when they first learned that their buildings were going condo. It concluded, however, that the hostility of the tenants was not as great as popularly believed -- or else that the hostility and negative feelings tend to decline rapidly after purchase or relocation.
One finding was that rents increased in all four counties for those tenants who moved because of conversion. But Hersker said there was a lack of accurate information about the prevailing apartment vacancy rate in south Florida -- information that has lead to legislative action with far-reaching social and economic implications. (He said he believes that the current reported vacancy rate of 1.2 percent is not correct.)
"It should be remembered," the report stated, "that condominium conversion is a shift in residential status rather than a diminution of available housing."
The state government's land sales and condominium division reported that last year, 16,145 apartments (2.8 percent of the rental apartments in the state) were converted to condominium ownership. It noted that this did not mean that 16,145 households were suddenly thrust upon the market to compete for a limited but unknown number of vacant apartments.
Based on the number of conversions and utilizing the percentages that were determined by their study, the Realtors said that the actual rental "shortfall" was only 2,712 units. Of the 16,145 conversions last year, the study indicated that 40 percent, or 6,458 units, were retained by tenant-purchasers. Of the outside purchasers, 29 percent, or 4,747 households, moved from other rental apartments, thus freeing them for new tenants, the researchers found.
Also, of the 60 percent of tenants who moved from the 16,145 conversions, only 77 percent, or 7,459, rented apartments. The difference between the 7,459 and 4,747 results in a shortfall of 2,712 rental apartments -- less than 1/2 percent of the state's apartments last year.
The study indicated that of those who had to move from newly converted buildings, 12 percent actually bought condominiums in other buildings, 8 percent bought houses and 2 percent rented houses. In addition, about 6 percent said they actually regretted not having bought their units.
An important finding, the Realtors said, was the strong preference for relocation near the original apartment.