Single-family home and condo prices are at an all-time high.
Miami-Dade County has a median sales price of $650,000 for a house and $420,000 for a condo; Broward saw prices rise to $625,000 for a house and $290,000 for a condo, according to the latest monthly home sales report by the Miami Association of Realtors. Single-family home prices rose by 17% in Miami-Dade and 12% in Broward from a year ago, and condo prices in both counties inched 7% higher.
South Florida home prices last broke a record in July 2023 when Miami-Dade had a median sales price of $631,670 for single-family homes and $420,000 for condos.
Blame the rich, said Mariya Letdin, a business professor at Florida State University. Homebuyers with deep pockets are driving the South Florida residential market, buying pricey homes and pushing median sales prices to historic highs.
“Activity is at the higher end of the market,” Letdin said. “It’s a tale of two cities within one city. The higher market is insulated from what’s going on. In the rest of the market, we’ll see decreases in prices, because interest rates are holding steady and people can’t afford to stretch their budget.”
In fact, the number of signed contracts grew year-over-year for single-family homes priced over half a million and up in Miami-Dade County in February by 13% to 741 contracts from 653 contracts, according to Douglas Elliman’s Florida 2024 new signed contracts report. However, houses priced below $500,000 saw a 38% drop in signed contracts to 223 deals from 361 deals.
South Florida’s wealth migration keeps prices and demand high. During the pandemic, South Florida got wealthier with corporate expansions, some of the world’s wealthiest — remember hedge fund Citadel Founder Ken Griffin and Amazon Founder Jeff Bezos? — moving to Miami, and those executives bringing their staff. As a result of corporate expansions and job growth, Miami-Dade has a historically low unemployment rate of 1.4%, according to data from the Federal Reserve.
The demand led to an increase in total home sales during what is usually considered one of Miami-Dade’s slowest months for activity. Miami-Dade had a total of 1,705 sales in February, up from 1,692 sales a year ago.
“We were surprised and not surprised by January and February,” said Nancy Klock Corey, a Coldwell Banker Realty regional president. “A lot of the buyers that were waiting on the fence in December came in January and February. That goes back to the market being driven by the buyer population.”
Broward saw a tiny decline in sales to 1,817 from 1,839 in February 2023.
For those who did buy, nearly half did so in cash. Miami-Dade and Broward saw 43% and 45% of total sales, respectively, close in dinero, higher than the 33% national average.
Some good news for buyers? They have more options on the table with rising inventory. Miami-Dade has 4.4 months supply of houses and 7.8 months of condos; Broward has 3.8 months supply of houses and 6.8 months of houses. A balanced market consists of six to nine months of inventory, with anything below that benchmark benefiting sellers and anything above benefiting buyers.
More housing options may be the only good news the average buyer gets for a while in South Florida. Starting this summer, buyers will have to worry about commission fees nationwide, a cost covered by sellers since the 1990s. It’s a change set last week by the National Association of Realtors and one real estate analysts and agents believe will be another burden for local home shoppers.
Source: MiamiHerald
