Market Update January 2022
MIAMI HOUSING MARKET UPDATE
Insane increases in the Miami market. Got the final numbers for 2021 and you definitely don’t want to miss it.
In this article we will be talking about how it closed last year. Spoiler alert, we have new records, the numbers are incredible, the statistics are incredible so don’t go away. Keep reading this article until the end because there is a lot that I have to share with you in this closing of the year.
Market Update January 2022 – How it closed last year
We learned that until November 2021 Miami Dade County had 3 all-time annual records:
- For total home sales (set in 10 months)
- All-time annual condo sales (set in nine months)
- The all-time annual single-family home sales (set in 11 months)
With the new December data, we add the best December sales month in history and the highest annual total dollar volume according to the MIAMI Association of Realtors (MIAMI) and the Multiple Listing Service (MLS) system.
The extremely red-hot market in Miami, fueled by local, out-of-state, and global homebuyers finished 2021 with 39,394 existing total home sales, which is 49.5% more than the 26,345 transactions Miami had in 2020.
This number itself is huge. 49.5% more between 2020 and 2021. Jeez!! 2021 was indeed crazy. Those who sold last year definitely got the advantages of their wealth meaning great home equity and those who bought were able to buy with the lowest interest rates in history. Now as far as my prediction of 2013 and 2021, last year the year ended 31.1% more than the previous annual record of 30,041 transactions in 2013.
Single Family Homes in Miami
Closed Sales
For the total home sales in Miami-Dade County, we had an increase of 14.8% year over year. In December 2021 from 2,990 sales to 3,433.
Last month, December, 1,356 single-family homes were sold which is actually up by 16% from November with 1,168 closed and actually a decrease of 1.2% year over year from December 2020 with 1,372. These numbers are important.
Median Sale Price
The median sale price for single-family homes in December is another incredible number. When we think about it as a holiday season. Miami-Dade County single-family median prices increased 15.4% year-over-year in December 2021, increasing from $454,900 to $525,000 and an increase of 4.4% from November 2021 with $502,750.
The last three years:
- From $350,000, $375,000 to $469,500 at the beginning of all three years that is a 7% increase between 2019 and 2020, and 34% between 2019 and 2021
- 2019 ended with $380,000, $454,900 in 2020 and $525,000 in 2021
- From 2019 to 2020 we saw a 19.7% increase. From 2020 to 2021 a 15.4% increase and from 2019 to 2021 a 38.1%
These numbers are in-sa-ne! That is why or I should say one of the reasons why loan amount limits have been increased.
Rising median prices
Rising median prices are a trend nationwide as record-low mortgage rates and the increased availability of remote work and education has accelerated the demand for housing. However, Miami’s percentage of sales increases continue to be higher than the nation and state.
To give you additional data, the median percent of the original list price received for single-family homes was 98.7% in December 2021, up 1.8% from 97% last year. The median percent of original list price received for existing condominiums was 97.3%, up 3.2% from 94.3% last year.
If you are not aware, last December the mortgage limits increased. For a Conforming/Conventional loan limits increased from $543,250 to $647,200. For an FHA loan limits increased from $402,500 to $460,000 in Miami Dade and Broward Counties.
Cash Sales
Cash sales represented 40.4% of Miami’s closed sales in December 2021, compared to 32.2% in December 2020. About 23% of U.S. home sales are made in cash, according to the latest NAR statistics. 23% and in Miami we are seeing 40.4% cash buyers, almost half of all transactions in December. The high percentage of cash buyers reflects Miami’s top position as the preeminent American real estate market for foreign buyers, who tend to purchase with all cash as well as some moving from more expensive U.S. markets who can buy more with their profits from real estate sales.
Luxury Market
Single-family luxury home transactions in Miami jumped 18.6% year-over-year to 262 sales in December 2021. Miami’s existing condo luxury sales doubled, surging 100% year-over-year to 264 transactions.
As you remember, last month I highlighted the highest home sold in the history of the whole county. The highest sold home in the county was sold last month for $75M. A majestic property situated on Star Island with nearly 2 acres of land on Miami Beach’s Star Island with views to the Port of Miami and the Magic City’s skyline. This dream house has over 15,000 Sq. Feet, 9 bedrooms, 8 baths. I must mention that Star Island is the jewel of Miami Beach on Biscayne Bay.
The luxury months of supply continue to trend downward for all property types, month-over-month, and year-over-year. Right now, there are 3.2 months of supply in luxury single-family homes; 7.5 months of supply in luxury condos. The previous month in November there were 3.6 for luxury single-family homes; 8.4 months of supply in luxury condos. The larger amount of Miami luxury sales in December 2021 compared to December 2020 is part of the reason for the large year-over-year increase in median prices.
New Listings
We had a total of 1,144 new listings which is down from December 2020 a decrease of 12.7% from last year. Months’ supply of inventory for single-family homes decreased 39.4% from last year to 2 months and for condominiums a 72% decrease from last year to 3.3% which means we are still in a strong seller’s market. And as far as the median time to contract in December was 19 days, a 17.4% decrease compared to last year.
Condo & Townhomes in Miami
Closed Sales
In December, Miami’s existing condo sales increased 28.4%, from 1,618 from last year to 2,077. This is huge!
We know that people are investing in South Florida, coming from other states especially from NY, CA, NJ, MA. Lots of investors are buying luxury vacation condominiums as a winter getaway. Other investors want to make a quick buck on short-term rentals, which is hard to do in the Miami market.
But now there are new projects with this type of flexibility. In fact, in Redfin’s latest migration analysis, Miami was the most popular migration destination of any major US metropolitan area for the fourth month in a row. Investors are aware of my beautiful city and having new projects like these ones without rental restrictions is causing more investors to come by putting their money in Miami with this type of investment.
To present to you one of them I actually did a video talking about one of the newest projects here in Miami allowing you to get a high return of investment by not having rental restrictions. This is only for people looking to get a passive income with Airbnb. I am pretty sure it won’t last because they already have over 1/3 of the building already reserved.
Median Sale Price
The median sales price for condos increased to $355,000 in December from $346,000 in November.
The Median Time to Contract
The median time to contract remained at 36 days in December and 35.7% decreased from December 2020.
The Miami condo market is indeed crazy as well.
New Listings
For new listings, 1,809 new listings came to the market. That is just a 5.6% decrease from last year and actually, a 14% decrease compared to November with 2,111. And months’ supply of inventory for condos continues to decrease 72% to 3.3 months which indicates a seller’s market. The prior month in November we had 3.7 and in October 4.0 months. It keeps getting more and more competitive month over month.
Sharon’s Insights
As you remember, the Fed’s announced in December 2021 that it will be raising rates and end bond buying in 2022. It’s a fact that low mortgage rates have been making home purchases more affordable. That has been one of the reasons why the huge buyer’s demand we have been seeing for the last 2 years. However, NAR Chief Economist Lawrence Yun expects the 30-year fixed mortgage rate to increase to 3.7% by the end of 2022. It would be still lower than the pre-pandemic rate of 4%. But according to Freddie Mac, the actual commitment rate for a 30-year, conventional, fixed-rate mortgage as of January 20th is 3.56%.
So I am guessing that prediction could be short. In fact, there are other experts with their predictions seeing the rates above 4%. What this change in raising rates could mean for you?
Should mortgage rates continue their upward climb, home price growth is likely to slow in response. Plus, as more sellers list properties in spring, the increased inventory should ease the growth of median prices.
Buyers and sellers…
I can’t stress this enough. The more you wait, the worse for you.
Buyer, you will get higher mortgage rates meaning you will pay more in the long term in your 30 years loan.
And let’s be honest, in South Florida, the median rent in the Miami metro area was $2,983 as of November, an increase of 35% from the previous year, the median monthly rent in the United States was $1,985 per month in November, an increase 20.5% compared to the previous year. That is a lot. Things we need to consider, right?
Seller, you will pass from getting multiple offers, best terms, the buyer’s demand, and most importantly best price for your house if you are still waiting.
You can still get this if you act now. Expectation that interest rates will rise should continue to drive demand in the first quarter of 2022. We already are seeing the rates going up, that is a fact on the table. Definitely, do not wait any longer to sell and/or buy your house in Miami. I can help. Let’s start by knowing what has been your home’s value for the last year. You can always complete the form below and I will personally reach out to you to see how I can help.
Additional Data
Let’s talk about some additional data. For those of you thinking that the market is going to crash and those of you waiting for the foreclosure tsunami that some people had anticipated, that is clearly not happening.
- In December 2021, only 1% of all closed residential sales in Miami were distressed, including REO (bank-owned properties) and short sales, compared to 1.9% in December 2020. In 2009, distressed sales comprised 70% of Miami sales.
- Total Miami distressed sales dropped 40.7% year-over-year in December 2021, from 59 to 35.
- Short sales and REOs accounted for 0.4% and 0.6% year-over-year, respectively, of total Miami sales in December 2021.
- Short sale transactions decreased 22.2% year-over-year while REOs dropped 48.8%.
As always, if you would like to download the full report provided by the Miami Realtors I’ve posted a link down in the description below for you to get it.
To see the full report for Single Family Homes click here
To see the full report for Townhouses and Condos click hre
If you are thinking about buying or selling in Miami, CLICK HERE or you can call me at 786-376-2398.
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Sharon Colón
Your Favorite Real Estate Agent in Miami
Home Miami Realtors
786-376-2398
[email protected]
www.sharoncolonre.com
