MIAMI — Miami-Dade County existing condominium sales, including $1-million-and-up transactions, increased year-over-year in November 2019, according to the MIAMI Association of Realtors (MIAMI) and the Multiple Listing Service (MLS) system.
Pending sales, which are indicators of future closed sales and reflect demand, are up in November and year to date for single-family homes and condos.
“Miami pending sales have increased in eight out of the last 10 months for both property types,” MIAMI Chairman of the Board José María Serrano said. “Homebuyers in tax-burdened states continue relocating and moving businesses to South Florida as a result of the new tax law limiting deductions on state and local taxes.”
Miami Existing Condominium Sales, Luxury Condo Sales Rise in November
Miami existing condo sales increased 1.0%, from 1,050 to 1,061. Miami's single-family home sales decreased by 2.4%, from 996 to 972. Pending sales, which are indicators of future closed sales and reflect demand, are up in November and year to date. Miami pending sales have increased in eight out of the last 10 months for both property types.
Total sales decreased a negligible 0.6%, from 2,046 to 2,033. Lack of inventory in lower price points contributed to the decline in transactions.
Inventory of active listings has decreased the last three months for condos and the last four months for single-family. Months supply is down since July for single-family and since March for condos, reflecting strong demand. In November, inventory only increased for condos listed between $250K and $299K.
With consumer confidence rising, unemployment low, job creation high and increased migration to Florida, Miami real estate should enjoy steady growth.
Miami luxury ($1-million-and-up) condo transactions increased by 4.1% to 51 transactions. Miami luxury single-family transactions decreased by 11.9% to 74 transactions.
Single-family home dollar volume decreased 2.2%, from $538.3 million to $526.7 million. Condo dollar volume decreased 0.2%, from $377.7 million to $377 million.
According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage increased to 3.70% in November, up from 3.69% in October. The average commitment rate across all of 2018 was 4.54%.
Lack of access to mortgage loans continues to inhibit further growth of the existing condominium market. Of the 9,307 condominium buildings in Miami-Dade and Broward counties, only 13 are approved for Federal Housing Administration loans, down from 29 last year, according to Florida Department of Business and Professional Regulation and FHA.
A new condo approval process could increase sales in the future. The new guidance, which went into effect in mid-October, extends certifications from two years to three, allows for single-unit mortgage approvals, provides more flexibility with owner/occupancy ratios, and increases the allowable number of FHA loans in a single project. The changes, many of which MIAMI and NAR have championed, are expected to generate increased homeownership opportunities.
Eight Consecutive Years of Price Appreciation in Miami
Miami-Dade County single-family home prices increased by 2.8% in November 2019, increasing from $355,000 to $365,000. Miami single-family home prices have risen for 96 consecutive months, a streak of 8 years. Existing condo prices increased 6.5%, from $230,000 to $245,000. Condo prices have increased or stayed even in 98 of the last 102 months.
Despite the price increase, Miami, where the median price is still comparable to 2006 figures, remains a bargain compared to other global cities. In Miami, $1 million can net homebuyers 93 square meters of prime property, according to Knight Frank’s 2019 The Wealth Report. Monaco (16 square meters), Hong Kong (22), New York (31), Los Angeles (36) and others offer significantly less prime land for $1 million.
Miami Distressed Sales Stay Low, Reflecting Healthy Market
Only 6.3% of all closed residential sales in Miami were distressed last month, including REO (bank-owned properties) and short sales, compared to 5.8% in November 2019. In 2009, distressed sales comprised 70% of Miami sales.
Total Miami distressed sales increased by 8.5%, from 118 to 128.
Short sales and REOs accounted for 1.4% and 4.9%, respectively, of total Miami sales in November 2019. Short sale transactions increased 21.7% year-over-year while REOs decreased 5.3%.
Nationally, distressed sales represented 2% of sales in November, unchanged from both October 2019 and November 2018.
Miami Real Estate Selling Close to List Price
The median number of days between listing and contract dates for Miami single-family home sales was 54 days, a 14.9% increase from 47 days last year. The median number of days between the listing date and closing date for single-family homes was 96 days, a 4.3% increase from 92 days.
The median time to contract for condos was 78 days, a 23.8% increase from 63 days last year. The median number of days between listing date and closing date was 119 days, 12.3% from 106 days.
The median percent of original list price received for single-family homes was 95.6%. The median percent of original list price received for existing condominiums was 93.8%.
National and State Statistics
Nationally, total existing-home sales transactions decreased by 1.7% from October to a seasonally-adjusted annual rate of 5.35 million in November. However, sales are up 2.7% from a year ago (5.21 million in November 2018).
Statewide closed sales of existing single-family homes totaled 21,842 last month, up 6.1% from November 2018, according to Florida Realtors. Florida’s condo-townhouse market totaled 8,101, down 6.3% from the level a year ago. Closed sales may occur from 30- to 90-plus days after sales contracts are written.
The national median existing-home price for all housing types in November was $271,300, up 5.4% from November 2018 ($257,400), as prices rose in all regions. November’s price increase marks 93 straight months of year-over-year gains.
Statewide median sales prices for both single-family homes and condo-townhouse properties in November rose year-over-year for 95 consecutive months. The statewide median sales price for single-family existing homes was $265,000, up 3.9% from the previous year. Last month’s statewide median price for condo-townhouse units was $195,000, up 5.4% over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.
Miami’s Cash Buyers Represent Almost Double the National Figure
Miami cash transactions comprised 35.1% of November 2019 total closed sales, compared to 36.9% last year. Miami cash transactions are almost double the national figure (20%).
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 50.4% of condo closings were made in cash in November compared to 18.4% of single-family home sales.
Seller’s Market for Single-Family Homes, Buyer’s Market for Condos
Inventory of single-family homes decreased 8% in November from 7,091 active listings last year to 6,526 last month. Condominium inventory decreased 4.9% to 15,369 from 16,162 listings during the same period in 2018.
Months supply of inventory for single-family homes decreased by 9.1% to 6 months, which indicates a seller’s market. Existing condominiums have a 13.2-month supply, which indicates a buyer’s market. A balanced market between buyers and sellers offers between six- and nine-months supply.
Total active listings at the end of November decreased by 5.8% year-over-year, from 23,253 to 21,895. Active listings remain about 60% below 2008 levels when sales bottomed.
New listings of Miami single-family homes decreased by 11.6% to 1,438 from 1,627. New listings of condominiums decreased by 9.6%, from 2,217 to 2,005.
Nationally, total housing inventory at the end of November totaled 1.64 million units, down approximately 7.3% from October and 5.7% from one year ago (1.74 million). Unsold inventory sits at a 3.7-month supply at the current sales pace, down from 3.9 months in October and from the 4.0-month figure recorded in November 2018. Unsold inventory totals have declined for five consecutive months, constraining home sales.
Source: MIAMI Association of Realtors (MIAMI) and the Multiple Listing Service (MLS) system.