Housing lotteries grow popular as homes go up for grabs in South Florida. Feeling lucky?

When people sign up for lotteries, they usually do so in the hopes of winning millions. But with the scorching housing market, people are signing up for lotteries in the hopes of spending millions.

As the demand for luxury properties in South Florida reaches unparalleled highs, gated communities are using lotteries as a way to create a semblance of order when listing new homes on the market.

These lotteries have become especially commonplace in southwest Palm Beach County, which has quickly transformed as a hot spot for upscale home developments due to the wide swath of available farmland. Luxury homebuilder GL Homes, which has driven the market in that area, has built more a dozen communities and has plans for more than 1,900 high-end homes.

Valencia Grand, a new 55-and-over community in West Boynton, and Lotus Palm Beach, which will feature more than 520 luxury homes in West Boca, are among the communities that are employing lotteries as wealthy people from out of state continue to flock to South Florida for more space and year-round sunny weather.

“It’s a function of demand,” said Elliot Koolik, principal of the Koolik Group and founding agent at Compass Boca. “So basically, when you know you have more demand than supply, you can create a scenario where you create more demand and more excitement for what you’re selling by [releasing a limited amount at a time.]

“It’s like being at a rock concert when you’re waiting for tickets or in college when you’re waiting for tickets to a football game. There’s a lot of demand for what they’re trying to sell and because of that it’s been working very well.”

Typically, prospective buyers will give a refundable deposit of between $5,000 to $10,000 to enter a housing lottery.

The communities will place a limited amount of homes, usually under 100, in each drawing and then repeat the process as many times as they see fit before opening up all of the homes to the general public.

A representative for GL Homes could not be reached for comment.

While GL Homes has used lotteries for their new luxury offerings in the past, the current housing surge has amplified the overall demand, said Ryan Greenblatt, a broker for Lang Realty who specializes in luxury products in West Boca.

The difference in the past was that a lottery was offered “for the beginning, for the first [homes] at the entry-level pricing,” Greenblatt said. “The reason why people wanted to get in on that lottery early is because it was usually pre-construction and you got a better price offering and then they would open it up so you could walk in and the prices would continue to rise.

“The difference now it’s lottery for everything. You have to win a lottery to take any lot.”

Boca, Greenblatt said lotteries are becoming more common across throughout the region, noting Lake Worth Beach and Loxahatchee as cities that have seen housing lotteries.

In West Boca, Lotus Palm Beach will feature more than 520 homes on a 189-acre golf course by Glades Road and Florida’s Turnpike. Homes are currently priced between $1.3 million and $2.5 million, according to the GL Homes website.

Greenblatt expects demand to be through the roof for those properties, saying he already has “buyers begging to get in there.”

“It’s uncharted water,” Greenblatt said. “It’s the first community in this area that will be new in this new post-COVID environment. All the other neighborhoods, Lotus and Boca Bridges, were already selling pre-COVID and you could walk in and buy a house after the lotteries.

“This is different. This is different market, it’s going to be interesting to see how they do this.”

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