Miami’s robust employment and growing population means Miami real estate will return to pre-Irma sales levels
MIAMI (PRWEB) October 20, 2017
Minimal damage from Hurricane Irma stalled hundreds of Miami-Dade County home sales in September as local buyers and sellers experienced delays in clearing tree debris and rescheduling inspections and appraisals, according to a new report by the MIAMI Association of REALTORS® (MIAMI) and the Multiple Listing Service (MLS) system.
Miami single-family home sales declined 35.8 percent year-over-year in September, from 1,066 to 684. Miami existing condo sales, which are competing with robust new construction, decreased 24.4 percent year-over-year last month, from 1,064 to 804. Both sectors are expected to return to pre-Irma sales levels as Miami homes get re-inspected and stalled transactions finalize.
“After Hurricane Irma, federal-backed lenders required new appraisals on Miami properties under contract and many Miami real estate buyers and sellers experienced delays in getting crews, inspectors and appraisers out last month,” said Christopher Zoller, the 2017 MIAMI chairman of the board and a Coral Gables Realtor. “Miami homes continue being purchased. Miami’s robust employment and growing population means Miami real estate will return to pre-Irma sales levels.”
Hurricane Irma made landfall as a Category 4 storm in the lower Florida Keys on Sept. 10. The storm brought Category 1 winds to Miami and limited damage, mostly fallen trees. Most power and Internet wasn’t fully restored in Miami until Sept. 19. Miami-Dade County has collected more than one million cubic yards of debris through Oct. 10. Hurricane Irma left an unprecedented 3 million cubic yards of debris in Miami, according to Miami-Dade County Department of Solid Waste Management.
Miami existing single-family home sales had increased year-over-year in four of the last five months preceding August 2017, which saw its reporting data impacted due to Hurricane Irma preparations, cleanup and extended power outages. Miami existing condo sales increased year-over-year in two of the last three months before August. Luxury sales for both single-family and condos were also on the rise — with $1-million-plus single-family sales jumping for five consecutive months, from February to July 2017.
Nearly Six Years of Price Appreciation in Miami
Miami-Dade County single-family home prices increased 6.5 percent in September 2017, increasing from $314,500 to $335,000. Miami single-family home prices have now risen for 70 consecutive months, a streak spanning nearly six years. Existing condo prices rose 7.1 percent, from $219,000 to $234,500 in September. Condo prices have increased in 73 of the last 76 months.
Miami real estate remains a bargain. A 120-square meter condominium in Miami-Fort Lauderdale-Miami Beach cost $170,000 in 2016 Q3, according to the National Association of REALTORS® (NAR). The average cost of a 120-square meter apartment in 2016 in the prime inner city areas of London ($4.1 million), Hong Kong ($3.1 million), and New York ($2.2 million) were at least ten times higher, according to Global Property Guide.
According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage dipped to 3.81 percent in September from 3.88 percent in August and is the lowest since November 2016 (3.77 percent). The average commitment rate for all of 2016 was 3.65 percent.
Hurricane Irma Delays Miami-Dade County Home Sales
Total existing Miami-Dade County residential sales — which posted a record year in 2013 and near record years in 2014 and 2015 — decreased 30.1 percent year-over-year from 2,130 to 1,488. Hurricane Irma stalled hundreds of Miami-Dade County home sales in September as local buyers and sellers experienced delays in clearing tree debris and rescheduling inspections and appraisals.
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 12 are approved for Federal Housing Administration loans, down from 29 last year, according to Florida Department of Business and Professional Regulation and FHA.
Total sales volume for all properties accounted for $631.1 million last month. These sales do not include Miami’s multi-billion dollar new construction condo market.
Miami Distressed Sales Continue to Drop
Only 9.1 percent of all closed residential sales in Miami were distressed last month, including REO (bank-owned properties) and short sales, compared to 16.4 percent in September 2016. In 2009, distressed sales comprised 70 percent of Miami sales.
Total Miami distressed sales declined 61.4 percent year-over-year, from 350 to 135 last month.
Short sales and REOs accounted for 2.1 and 6.9 percent, respectively, of total Miami sales in September 2017. Short sale transactions dropped 53 percent year-over-year while REOs fell 63.4 percent.
Nationally, distressed sales accounted for 4 percent of sales in September, unchanged from a year ago.
Miami Real Estate Selling Faster and Close to List Price
The median number of days between listing and contract dates for Miami single-family home sales was 41 days, a 8.9 percent decrease from 45 days last year. The median number of days between the listing date and closing date for single-family properties was 92 days, an 8.9 percent drop from 101 days.
The median time to contract for condos stayed the same at 93 days. The median number of days between listing date and closing date decreased 3.2 percent to 120 days.
The median percent of original list price received for single-family homes was 95.1 percent. The median percent of original list price received for existing condominiums was 93.2 percent.
National and State Statistics
Nationally, total existing-home sales rose 0.7 percent to a seasonally adjusted annual rate of 5.39 million in September from 5.35 million in August.
Statewide closed sales of existing single-family homes totaled 18,030 last month, down 20.4 percent compared to September 2016, according to Florida Realtors. Statewide closed condo sales totaled 7,404 last month, down 15.9 percent compared to September 2016.
The national median existing-home price for all housing types in September was $245,100, up 4.2 percent from September 2016 ($235,200). September's price increase marks the 67th straight month of year-over-year gains.
The statewide median sales price for single-family existing homes last month was $239,900, up 7.6 percent from the previous year, according to Florida Realtors. The statewide median price for townhouse-condo properties was $173,000, up 8.1 percent over the year-ago figure. September was the 70th month-in-a-row that statewide median prices for both sectors rose year-over-year.
Miami’s Cash Buyers Represent More Than Double the National Figure
Miami cash transactions comprised 43.5 percent of September total closed sales, compared to 42.9 percent last year. Miami cash transactions are more than double the national figure (20 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. Miami has a higher percent of cash sales for condos due to lack of financing approvals for buildings.
Condominiums comprise a large portion of Miami’s cash purchases as 57.6 percent of condo closings were made in cash in September compared to 27.0 percent of single-family home sales.
Seller’s Market for Single-Family Homes, Supply Declines in September
Inventory of single-family homes decreased 4.8 percent in September from 6,368 active listings last year to 6,060 last month. Condominium inventory increased 5.2 percent to 14,834 from 14,106 listings during the same period in 2016.
Monthly supply of inventory for single-family homes decreased 1.7 percent to 5.7 months, which indicates a seller’s market. Existing condominiums have a 13.7-month supply, which indicates a buyer’s market. A balanced market between buyers and sellers offers between six and nine months supply of inventory.
Total active listings at the end of September increased 2.1 percent year-over-year, from 20,474 to 20,894. Active listings remain about 60 percent below 2008 levels when sales bottomed. New listings of Miami single-family homes decreased 44.7 percent to 967 from 1,749. New listings of condominiums decreased 34.3 percent, from 2,175 to 1,429.
Nationally, total housing inventory at the end of September rose 1.6 percent to 1.90 million existing homes available for sale, but still remains 6.4 percent lower than a year ago (2.03 million) and has fallen year-over-year for 28 consecutive months. Unsold inventory is at a 4.2-month supply at the current sales pace, which is down from 4.5 months a year ago.
To access September 2017 Miami-Dade Statistical Reports, visit http://www.SFMarketIntel.com
Note: Statistics in this news release may vary depending on reporting dates. MIAMI reports exact statistics directly from its MLS system.
About the MIAMI Association of REALTORS®
The MIAMI Association of REALTORS® was chartered by the National Association of Realtors in 1920 and is celebrating 97 years of service to Realtors, the buying and selling public, and the communities in South Florida. Comprised of six organizations, the Residential Association, the Realtors Commercial Alliance, the Broward Council, the Jupiter Tequesta Hobe Sound (JTHS-MIAMI) Council, the Young Professionals Network (YPN) Council and the award-winning International Council, it represents more than 45,000 real estate professionals in all aspects of real estate sales, marketing, and brokerage. It is the largest local Realtor association in the U.S., and has official partnerships with 164 international organizations worldwide. MIAMI’s official website is http://www.MiamiRealtors.com