September was a strong month for Miami’s single-family market, as sales and prices rose in moderate tandem, signifying continued strong demand heading into a traditionally slower season, according to a new report from the Miami Association of Realtors (MIAMI) and the local MLS.
Lumping together all property types, sales actually fell 3.2 percent in September compared to a year prior, but those declines were driven drops in condominium transactions, which fell 8.3 percent year-over-year. Single-family sales, however, rose 2.9 percent from 1,166 last September to 1,200.
Prices for single-family homes also increased in September, rising double digits (14 percent) year-over-year to $285,000. Persistent foreign interest is helping to maintain strong demand, but some of the rise can also be attributed to a weak inventory, which fell 5.4 percent year-over-year from 6,347 to 6,002 in September.
A Tough Condo Market
While MIAMI’s report documented a wholly positive month for the single-family sector, it also revealed a weakening condo market, which has been plagued with overbuilding and a lack of approval for FHA financing.
Despite the drop in condo sales, inventory increased 6.3 percent from the same time last year and median price jumped 2.8 percent. Some experts fear the sector is in trouble and being overbuilt, but MIAMI Senior Vice President of Government Affairs and Housing Danielle Blake believes sales can be improved by clearing some existing buildings for FHA loans.
“Increasing the number of local condo buildings approved for FHA loans will increase the ability for more South Florida residents to gain the dream of homeownership,” she said.
Of the 8,523 condominium buildings in Miami-Dade and Broward Counties, only 29 are approved for FHA loans, according to the Florida Department of Business and Professional Regulation and FHA. On what the association is doing to bolster those numbers, Blake said: “(MIAMI) continued to work on ways to increase access to these mortgage loans.”
One of the Top Local Sales Years on Record
With suggestions of overvaluation and overbuilding, the future, long-term direction of Miami’s market is in question. But according to MIAMI’s 2015 Residential President Christopher Zoller, the city is on track to maintain its pace into the new year – even for condos.
“After a historic summer of home sales and rising prices, the Miami single-family home market continued its upward trend in September,” he said. “Not only are more single-family homes being sold compared to last year, but it is taking significantly less time to complete those transactions. Existing condominiums are also seeing fewer days on the market and higher median sales prices. Miami’s existing condominium segment remains on pace to finish 2015 as one of the top local sales years on record.”