Miami Market Enjoys Over $800 Million in Residential Sales in February
Miami's Cash Buyers Still Represent Twice the National Average
According to a new report by the Miami Association of Realtors, Miami residential properties registered $812.5 million in total sales in February 2016 as single-family homes and condominiums posted major price gains.
The median sales price for single-family existing homes rose 10.3 percent year-over-year in February 2016, from $245,000 to $270,221. The median sales price for existing condominiums increased 9.5 percent in February to $206,950 from $189,000 a year ago. Miami-Dade County existing condo prices have risen in 56 of the last 57 months, a period encompassing more than four and a half years. Miami prices remain at 2004 levels despite four years of increases.
"Miami's median prices are still significantly below their 2007 peak," said Mark Sadek, a Coral Springs Realtor and the 2016 MAR Chairman of the Board. "Miami real estate remains a bargain especially compared to other world-class cities, and domestic and international consumers proved that in February as total dollar sales volume in single-family homes increased 7 percent compared to the previous year."
A 120-square meter condo in Miami-Fort Lauderdale-Miami Beach cost $149,900 on average, according to the National Association of Realtors. Prices for the same condo in London ($960,840), Hong Kong ($776,280), and New York ($1.6 million) were at least five times higher. In the U.S., South Florida's single-family median sales price ranked 26th compared to other metropolitan areas, according to NAR.
Total Sales Finish Strong, but below Highest Record Years
Total existing Miami-Dade County residential sales -- which posted a record year in 2013 and near record years in 2014 and 2015 -- decreased 5.8 percent from 2,165 sales in February 2015 to 2,039 last month. The February 2016 total sales remain in line with Miami historical averages.
Miami-Dade County single-family home transactions decreased a negligible 0.3 percent in February, from 982 to 979. Existing condominium sales -- which declined 10.4 percent, from 1,183 to 1,060 -- are competing with a robust new construction market, which continues to add inventory.
Total Miami residential properties combined for $812.5 million in total sales volume in February 2016, about 4.9 percent lower than the $854.1 million sold during the same month last year. The aforementioned sales volume does include the strong new construction condo sales figures.
The single-family market registered a 7-percent rise in total dollar volume in February 2016, posting $451.7 million in sales compared to $422.2 million last year. Existing condominiums posted $360.8 million in total dollar sales, a 16.5 percent decline from $431.9 million in February 2015 but does not include new construction condo sales figures.
Transactions in Popular Price Points Rise Significantly
Single-family home sales spiked 18.5 percent year-over-year in February in the $200,000 to $600,000 sector, growing from 492 to 583. The sector represented about 59.6 percent of all total single-family home sales in February 2016.
Existing condos priced at $150,000 to $300,000 range experienced an 8.6 percent jump in February sales, increasing from 371 to 403. This sector represented about 38 percent of all total condo home sales in February 2016.
Historic-low mortgage rates should continue to attract future buyers. According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage was 3.66 percent in February, which is the lowest since April 2015 at 3.67 percent.
Miami Real Estate Selling Faster and Close to List Price
The median number of days between the listing and contract dates for Miami single-family home sales decreased 6 percent year-over-year to 63 days. The median number of days between the listing date and closing date for single-family properties decreased 0.8 percent to 120 days.
For condos, the median time to contract decreased 12 percent year-over-year to 72 days. The median number of days between the listing date and closing date decreased 2.4 percent to 122 days.
Miami real estate is selling close to listing price. The median percent of original list price received for single-family homes was 95.2 percent in February 2016, an increase of 0.4 percent. The median percent of original list price received for existing condominiums was 93.8 percent, a 0.2 percent increase.
New Policy Should Qualify More South Florida Condo Buildings for FHA Loans
In addition to competing sales from new construction units, the lack of access to mortgage loans is also impacting existing condominiums. Of the 8,523 condominium buildings in Miami-Dade and Broward Counties, only 23 are approved for Federal Housing Administration loans, down from 29 last year, according to statistics from the Florida Department of Business and Professional Regulation and FHA.
A new FHA policy should qualify more South Florida condo buildings. On Nov. 12, the FHA announced plans to streamline the condominium recertification process, expand its definition of acceptable owner-occupied units to include second homes not owned by investors and change the way it views co-insurance clauses.
Distressed Sales Continue to Decline
Only 23.4 percent of all closed residential sales in Miami were distressed last month, including REO (bank-owned properties) and short sales, compared to 35.0 percent in February 2015.
Short sales and REOs accounted for 5.7 and 17.8 percent, respectively, of total Miami sales in February. Short sale transactions dropped 25.6 percent year-over-year while REOs fell 39.9 percent.
Nationally, distressed sales were 10 percent of sales in February, down from 11 percent a year ago.
National and State Statistics
Nationally, sales of existing single-family homes, townhomes, condominiums, and co-ops dropped 7.1 percent to a seasonally adjusted annual rate of 5.08 million in February from 5.47 million in January. National sales are still 2.2 percent higher than a year ago.
Statewide, closed sales of existing single-family homes totaled 18,159 last month, remaining relatively the same (up 0.4 percent) as the February 2015 figure. Florida's condominium sales totaled 7,658 last month, down 5.4 percent compared to February 2015.
The national median existing-home price for all housing types in February 2016 was $210,800, up 4.4 percent from February 2015 ($201,900). February's price increase marks the 48th consecutive month of year-over-year gains.
The statewide median sales price for single-family existing homes last month was $200,000, up 11.1 percent from the previous year, according to Florida Realtors. The statewide median price for townhouse-condo properties was $150,000, up 5.6 percent over the year-ago figure.
Miami's Cash Buyers Still Represent Twice the National Average
Miami cash transactions comprised 52.4 percent of February total closed sales, compared to 58.7 percent last year. Miami cash transactions remain more than double the national average of 25 percent. Miami's high percentage of cash sales reflects South Florida's ability to attract a diverse number of international home buyers, who tend to purchase properties in all cash.
Condominiums comprise a large portion of Miami's cash purchases as 66.3 percent of condo closings were made in cash in February compared to 37.3 percent of single-family home sales.
Seller's Market for Single-Family Homes, Buyer's Market for Condos
Inventory of single-family homes increased 4.7 percent in February from 6,264 active listings last year to 6,557 last month. Condominium inventory increased 16.3 percent to 13,853 from 11,915 listings during the same period in 2015.
There is a 5.7-month supply of Miami single-family homes, an increase of 3.6 percent from February 2015 and continues to be a sellers' market. There is a 10.6-month supply of condominium inventory, a year-over-year increase of 20.5 percent and continues to be a buyers' market. A balanced market between buyers and sellers offers between six and nine months supply of inventory.
Total active listings at the end of February increased 12.3 percent year-over-year, from 18,179 to 20,410. Active listings remain about 60 percent below 2008 levels when sales bottomed.
New listings of Miami single-family homes increased 24.7 percent from 1,635 in February of last year to 2,039 last month. New listings of condominiums increased 13.4 percent to 2,826 last month, compared to 2,491 during the same time period in 2015.
Nationally, total housing inventory at the end of February increased 3.3 percent to 1.88 million existing homes available for sale, but is still 1.1 percent lower than a year ago (1.90 million). Unsold inventory is at a 4.4-month supply at the current sales pace, up from 4.0 months in January.
New Construction Data
Strong sales in the Miami preconstruction condominium market east of Interstate 95 continue to reflect significant demand for new properties, according to the latest New Construction Market Status Report from preconstruction condo projects website Cranespotters.com and the Miami Association of Realtors.
Thirty-nine towers with 709 floors and 3,729 units have been completed in Miami-Dade County east of I-95 in the four years since 2011, according to the Feb. 22 report. There are 78 towers with 1,769 floors and 11,201 units under construction in Miami east of I-95. About 59 towers with 1,337 floors and 7,954 units are planned, but have not begun development. About 86 towers, 2,045 floors and 13,982 units are proposed.
