Although Miami’s inequality gap is narrowing – luxury home prices have shrunk, while the market’s bottom price has risen – it still remains one of the country’s most unequal housing markets.
How unequal? About 5.5 times as much, according to Redfin.
In an analysis of the country’s biggest housing markets, Redfin compared average luxury home price with the bottom 95 percent of the market, respectively. Of the 10 most unequal cities nationwide, as the below graph shows, seven are in Florida, including Miami.
But as alluded, Miami’s market ceiling and floor are inching closer to one another. In last year’s fourth quarter, the city’s average luxury home price fell 1.9 percent year over year to $1.5 million – one of the largest declines in the country, as the below table shows – while the average price of the market’s bottom 95 percent rose 9.8 percent to $280,000.
| Cities with Biggest Luxury Price Declines | Avg. Sale Price (Top 5%) | YoY Change | Avg. Sale Price (Bottom 95%) | YoY Change |
|---|---|---|---|---|
| Reno | $991,000 | -33.20% | $307,000 | 5.10% |
| Washington, D.C. | $2,094,000 | -16.20% | $572,000 | 2.90% |
| Paradise, Nev. | $1,050,000 | -14.10% | $200,000 | 7.00% |
| Austin | $1,651,000 | -10.90% | $370,000 | 2.80% |
| Chicago | $1,412,000 | -9.60% | $280,000 | 5.70% |
| San Diego | $2,292,000 | -7.60% | $566,000 | 7.60% |
| Fort Lauderdale | $2,784,000 | -7.00% | $334,000 | 4.40% |
| Miami | $1,533,000 | -1.90% | $280,000 | 9.80% |
| Alexandria, Va. | $1,294,000 | -1.00% | $450,000 | 0.20% |
Right now, price fluctuations are being catalyzed by Miami’s shortage of affordable homes and glut of expensive ones. It’s not an ideal situation for the market, but the persisting condition does guarantee a somewhat drawn out pooling of equity in the lower end of Miami’s home market.