According to the Miami Association of Realtors, the Miami-Dade County real estate market continued to strengthen in October as properties sold fast and near asking price and sales prices again increased.
October 2015 marked more than four years of consistent monthly median sales price increases for both single-family homes and condominiums in Miami-Dade. Last month, the median sales price for single-family homes rose 10.4 percent year-over-year, from $240,000 to $265,000.
Single-family home and condominium prices remain at 2004 levels despite four years of consistent year-over-year increases.
The median sales price for existing condominiums increased 8.1 percent in October to $200,000 from $185,000 a year ago. Miami-Dade County condo prices have risen in 52 of the last 53 months, a period stretching nearly four and a half years.
"Miami real estate continues to attract international buyers from all over the world as well as a growing number of domestic consumers," said Christopher Zoller, a 27-year Miami-based Realtor and the 2015 Residential President of MIAMI. "South Florida offers world-class amenities, a top-tier arts and cultural epicenter, a diversified economy and more. The strong demand is leading to fewer days on the market for Miami single-family homes while buyer offers are near asking price."
Miami Real Estate Selling Close to List Price
The average percent of original list price received for single-family homes was 95.6 percent in October 2015, an increase of 0.3 percent from a year earlier. The median number of days on the market for Miami single-family homes decreased 7 percent to 40 days in October 2015 from 43 days in October 2014.
The median number of days on the market for condominiums sold in October 2015 was 59 days, a 1.7 percent increase from 58 days in October 2014. The average percent of original list price received was 93.8 percent, a 0.1 percent year-over-year increase.
Total existing Miami-Dade County residential sales, including single-family and condominiums, were consistent with historical averages despite experiencing a slight decline of 5.6 percent, from 2,712 sales in October 2014 to 2,559 last month.
Miami-Dade County single-family home transactions decreased 4.4 percent year-over-year in October, from 1,204 to 1,151. Existing condominiums -- which are competing with a significant rise in supply of new construction properties east of Interstate-95 -- had 6.6 percent fewer sales in October, decreasing from 1,508 to 1,408.
Mortgage rates remain at historic lows. According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage declined to 3.80 in October from 3.89 percent in September - and from an average commitment rate of 4.04 percent a year ago.
New Policy Should Qualify More South Florida Condo Buildings for FHA Loans
In addition to increased sales of new construction properties; Miami existing condominiums have been impacted by a lack of access to mortgage loans. Of the 8,523 condominium buildings in Miami-Dade and Broward Counties, only 23 are approved for Federal Housing Administration loans, down from 29 earlier this year, according to statistics released earlier this year from the Florida Department of Business and Professional Regulation and FHA.
A new FHA policy, however, 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.
"The new FHA policy should broaden the opportunity for South Florida families to realize the dream of homeownership," said Danielle Blake, MIAMI's Senior Vice President of Government Affairs & Housing. "By increasing the number of local condo buildings approved for FHA loans, more consumers will be able to access FHA's low down payment mortgages. Accepting Citizens insurance and co-insurance clauses is another significant development, which would help more than 85% of Florida's condo projects in complying with FHA's insurance requirements."
National and State statistics
Nationally, sales of existing single-family homes, townhomes, condominiums, and co-ops decreased 3.4 percent to a seasonally adjusted annual rate of 5.36 million in October from 5.55 million in September, according to the National Association of Realtors (NAR). National sales are now 3.9 percent above a year ago (5.16 million).
Statewide, closed sales of existing single-family homes rose last month with a total of 22,147, an increase of 1.2 percent over October 2014, according to Florida Realtors. Florida's condominium sales totaled 9,294, down 0.9 percent compared to October 2014.
The national median existing-home price for all housing types in October 2015 was $219,600, which is 5.8 percent above October 2014 ($207,500), according to NAR. October's price increase marks the 44th consecutive month of year-over-year gains.
The statewide median sales price for single-family existing homes last month was $198,995, up 12.4 percent from the previous year, according to Florida Realtors. The statewide median price for townhouse-condo properties was $150,000, up 7.2 percent compared to last year.
Miami's Cash Buyers Represent More than Twice the National Average
In October, cash deals represented 51.5 percent of Miami's total closed sales, which is more than double the national average. Just 24 percent of all U.S. housing sales were made in cash in October, according to NAR. Cash transactions represented 55.8 percent of total Miami deals in October 2014. Miami's high percentage of cash sales reflects South Florida's ability to attract a diverse number of international homebuyers, who tend to purchase properties in all cash.
Condominiums comprise a large portion of Miami's cash purchases as 64.1 percent of condo closings were made in cash in October compared to 36.1 percent of single-family home sales.
Distressed Property Transactions Decline in Miami
Only 23.7 percent of all closed residential sales in Miami were distressed last month, including REO (bank-owned properties) and short sales, compared to 34.9 percent in October 2014.
Short sales and REOs accounted for 5.1 percent and 18.6 percent, respectively, of total Miami sales in October. Short sale transactions dropped 40.1 percent year-over-year while REOs decreased 34.7 percent.
Nationally, distressed sales were 6 percent of sales in October, down from 9 percent a year ago.
Seller's Market for Existing Single-Family Homes, Balanced Market for Condos
Miami-Dade County's single-family sector is in a seller's market, while condo sales reflect a balanced market between buyers and sellers. Inventory of single-family homes decreased 4.2 percent from 6,439 active listings last year to 6,169 last month. Condominium inventory increased 7.3 percent to 12,197 from 11,362 listings during the same period in 2014.
At the current sales pace, there is a 5.2-month supply of Miami single-family homes, a decrease of 9.3 percent from 5.8 months in October 2014. There is a 9.1-month supply of condominium inventory, up from 8.2 months in October 2014, an increase of 10.6 percent. A balanced market between buyers and sellers offers between six and nine months supply of inventory.
Active listings at the end of October increased 3.2 percent year-over-year, from 17,801 to 18,366. Active listings remain about 60 percent below 2008 levels when sales bottomed.
New listings of Miami single-family homes decreased 7.6 percent from 2,316 in October of last year to 2,140 last month. New listings of condominiums increased 1.1 percent to 3,036 last month, compared to 3,003 during the same time period in 2014.
Nationally, total housing inventory at the end of October decreased 2.3 percent to 2.14 million existing homes available for sale, and is now 4.5 percent lower than a year ago (2.24 million). Unsold inventory is at a 4.8-month supply at the current sales pace.
New Construction Market Update
Strong sales in the preconstruction condominium Miami market east of Interstate 95 continue to reflect significant demand for new properties, according to the latest New Construction Market Status Report released by the preconstruction condo projects website Cranespotters.com and MIAMI.
Thirty-one towers with 615 floors and 3,149 units have been completed in Miami-Dade County east of I-95 in the four years since 2011, according to the Nov. 12 report. There are 77 towers with 1,614 floors and 10,097 units under construction in Miami east of I-95.
According to the most recent developers' price survey conducted by Cranespotters.com in May 2015:
103 projects with 119 towers comprising 17,199 units are selling.
71 percent of units have been sold.
The minimum price per square foot of these units is $949, compared to $952 in April 2015.