Strong demand from home and abroad fuelling Miami real estate market
The Miami residential real estate market continued to see rising prices in the second quarter of 2014 due to strong demand, according to the latest report from estate agents.
The data from the Miami Association of Realtors show that there is particularly strong demand for single family homes priced between $200,000 and $400,000.
Overall the median sales price for homes in Miami-Dade County was $245,000, an increase of 8.9% compared to last year, while the median sales price for condominiums rose 5.6% to $190,000.
The market has now seen prices increase for 10 consecutive quarters for both single family homes and condominiums with demand from both domestic and overseas buyers.
‘While supply is growing and creating more balance between buyers and sellers, inventory in certain price points and market segments remains tight, particularly for single family homes. Financing for condominiums is still difficult to obtain, a fact that is hurting sales for this property type,’ said Liza Mendez, chairman of board.
Compared to last year, the average sales prices for single family homes and condominiums increased 3.5% to $460,018 and 6.7% to $375,941, respectively.
While in the whole of Florida the median sales price for single family existing homes in the second quarter was $180,000, up 5.3% from the same quarter a year ago and for condominiums it was up 10.1% to $142,000.
There were 8,139 homes and condos sold in Miami-Dade County during the second quarter of 2014, a negligible decrease of 0.9% compared to the second quarter of 2013, when there was record sales activity. Sales of single family homes increased 4.9% and condominium sales decreased 5.2%.
However, sales of single family homes priced between $200,000 and $400,000 surged 68% in the second quarter while sales of condominiums priced between $100,000 and $400,000 increased 35%.
‘As the Miami real estate market continues to normalize and perform in a healthy manner, there are increased opportunities for all types of buyers. While inventory is still limited depending on the area and price range, buyers generally have more to choose from and prices remain at affordable 2003 levels,’ said Francisco Angulo, residential president of the Miami Association of Realtors.
The Association also said that its initiatives to increase inventory and focus on assisting members to get more listings has proven successful along with some additional distressed properties coming on the market. The fact that sales remain at historically strong levels while inventory is growing points to seller confidence, it said and sellers are listing properties for sale because they have confidence in the market.
Home and condominium listings also increased in the second quarter but by narrower margins. There were 8,635 new single family home listings during the second quarter, a growth of 4% compared to a year ago. New condominium listings increased 3.8% from 6,025 in the second quarter of 2013 to 6,255 this year.
At the current sales pace, current inventory represents 5.5 months of inventory for single family homes and 7.8 for condominiums. Compared to the second quarter of 2013, supply of inventory for single family homes and condominiums increased 13.5% and 33.6% respectively. A balanced market between buyers and sellers offers between six and nine months’ supply of inventory.
The median duration of single family home listings during the second quarter was 43 days compared to 40 days during the same period last year, a slight increase of 7.5%. Similarly, the median days on the market for condominium listings were 56 days compared to 45 last year, an increase of 24.4%.
In the second quarter, 57.6% of sales were all cash compared to 62.6% a year earlier. All cash sales were 43.9% of single family home closings and 68.8% of all condominium sales. Since nearly 90% of foreign buyers pay cash, this reflects Miami’s position as a top market for foreign buyers. Miami has a significant percentage of international buyers, generating many more cash transactions than the national average.