Sales were up, prices were up and homes sold faster, so despite a dip in inventory, it was mostly a banner quarter for Miami, a report from the Miami Association of Realtors recently confirmed.
Residential sales topped 7,800 this quarter, which marks a 2.3 percent increase from the same period last year. Growth can largely be attributed to the 4.1 percent year-over-year jump in single-family transactions – though, condo sales did still inch forward 0.8 percent despite the rise in inventory and pre-construction condo units available.
The strong demand represented in sales translated to price as well in the third quarter. In the single-family sector, median price was pushed up 9.3 percent from the third quarter in 2014 to $273,200 – higher than both the state’s median price of $199,900 and the national median of $229,000. Condo median price also experienced a healthy bump of 4.8 percent.
Prices + Low Mortgage Rates + Diverse Job Market = Consumer Confidence
Since the beginning of the year, several organizations, including rating agency Fitch Ratings, have put forward evidence claiming Miami properties are overvalued. However, according to the National Association of Realtors 2015 Profile of Home Buying Activity of International Clients, the city remains “more affordable” than other global cities, such as London, where the difference in condo price is more than $700,000 – a fact MIAMI 2015 Residential President Christopher Zoller reiterated in a statement accompanying the association’s report.
“Miami real estate remains a bargain compared to other world-class global cities,” he said. “Miami single-family home prices are at 2004 levels, considerably lower than world cities such as New York, London and Hong Kong.”
Zoller attributed a growing consumer confidence to a coupling of prices, low mortgage rates and the area’s diversified job market.
Inventory Issues
The appeal of Miami’s real estate market, particularly its luxury sector, which attracts buyers from around the globe, is becoming more apparent to many homeowners in the city, as active listings were up in the third quarter from 17,480 during the same period last year to 17,837 – a 2 percent increase.
Still, demand in the single-family sector is outpacing both builders and the ambitions of potential sellers. Median days on market has dropped from 45 a year ago to 39, while inventory tumbled 5.4 percent to a 5.1-month supply – still ahead of the national supply.
As mentioned above, the supply of available condos in Miami has surged this year, a trend that continued in the third quarter, as active listings went up 6.3 percent year-over-year to an 8.7-month supply. But demand in the sector has failed to keep up. Median days on market for condos climbed 5.3 percent from the same period last year to 60.