Are you ready to discover the remarkable surge reshaping Miami’s housing market? Luxury home sales in Miami have soared to new heights, surpassing pre-pandemic levels and showcasing the market’s resilience and strong demand for upscale properties. With a shocking 94.3% increase in luxury home sales compared to April 2019, Miami’s allure continues to captivate affluent buyers from both domestic and international markets. Renowned for its desirable location, stunning waterfront properties, and favorable tax environment, Miami has become a sought-after destination for luxury real estate investment. Join us as we explore the exciting dynamics and exceptional opportunities in Miami’s luxury housing market.
Undoubtedly, Miami’s real estate scene has been on fire.
But what are the factors of this huge increase in home sales in the luxury market? Let’s discuss.
One of the driving factors behind this surge in luxury home sales is the influx of wealthy buyers from both domestic and international markets. Miami’s desirable location, stunning waterfront properties, and favorable tax environment are attracting affluent individuals and families from around the globe.
People and companies from California and New York for example have been moving to Florida for the last 3 years. In fact, Florida ranked No. 1 in the U.S. in largest net gain of adjusted gross income (AGI) due to domestic migration, gaining $23.7 billion, according to most recent IRS-SOI migration data. Miami-Dade’s out-of-state homebuyers with a mortgage earn nearly $100,000 in median household income. But does that mean local’s income has increased? What do you say about that? Comment below Miami locals, I want to hear from you.
Another contributing factor is the renewed confidence in the market. Despite the challenges posed by the pandemic, Miami’s real estate sector has rebounded exceptionally well. Investors and buyers recognize the long-term value and potential for growth in Miami’s luxury home market, making it an attractive destination for real estate investments.
Additionally, we can’t forget about the lifestyle. Miami’s luxury home market offers a wide range of amenities and features that cater to the discerning tastes of affluent buyers looking for exclusivity. But also, the city of Miami itself has undergone a remarkable transformation in recent years. With its vibrant arts and culture scene, world-class dining options, and thriving business environment. Definitely, Miami has become a hotspot for those seeking a luxurious and cosmopolitan lifestyle.
In fact, according to the 2023 Knight Frank Wealth Report, Miami holds the fourth position globally for super-prime real estate transactions valued at $10 million or more, and ranks fifth for ultra-prime sales exceeding $25 million.
Miami total home sales decreased 35.5% year-over-year in April 2023 and 15.7% decreased from 2019.Less and less sales especially comparing the recent stats with a more normal market like 2019. Breaking that down, that means Miami single-family home sales decreased 19.7% from last year and decreased 21% from 2019 while Miami existing condo sales decreased 44.4% year over year and 10.4% from 2019.
Single-family home median prices increased 6.2% year-over-year in April 2023, increasing from $565,000 to $600,000 and 5.3% increase from the previous month. In fact, this is the highest median price we had seen in Miami Dade for single family houses which is very interesting how for the last few months the market has been increasing once again with higher rates.
Similarly, existing condo median prices increased 6.4% year-over-year, from $390,000 to $414,900 and 3.7% increase from the previous month.
In April 2023, a significant portion of the homes that were bought had negotiations taking place in March. During that time, mortgage rates kicked off at 6.71% and then rose to 7.03% on March 7, 2023. However, rates stabilized for a while before experiencing another increase. To put things into perspective, on March 1, 2022, the rates were at a much lower 3.90%. According to Freddie Mac, the 30-year fixed-rate mortgage averaged 6.39% as of 05/18/2023.
Let’s talk now about inventory.
The inventory of available homes in April 2023 in Miami-Dade reached the second lowest point in history for that month, only surpassing the numbers from April 2022. The total inventory dropped by 53.1% compared to the historical county average for April.
Similarly, the number of new listings in April 2023 was the second lowest on record for that month. The new listings were down by 28.8% compared to the historical county average for April.
Looking specifically at single-family homes, the inventory increased by 28.3% in April 2023 compared to the previous year. For condominiums, the inventory rose by 34.6% year-over-year.
In terms of new listings, there was a 30.1% decrease in Miami single-family homes. Condominiums also experienced a decrease of 25.3%.
Last point about inventory.
The months’ supply of inventory for single-family homes increased by 73.7% to 3.3 months. And, existing condominium inventory also saw a significant increase of 113%, reaching 4.9 months. However, while we are seeing increases year over year for both, for the single family data it is showing decreases month over month. Since January we are seeing this going down, the other way around and we know what this means. Too much demand and low inventory? Multiple offers on the table and bidding wars for sellers again.
The median percent of original list price received for single-family homes was 96.6% and 96% for condos in April 2023. Yes, it is down from last year. However, they both actually are going up. We know that, by seeing the median price going up as well. So sellers are getting offers close to the listing price or better.
As far as the median time to contract they both are going down. Taking less time to sell properties. Single family homes are now taking 30 days and condos 37 days. Indeed, much faster.
Certainly, the Miami luxury home market is experiencing an extraordinary upswing, providing unparalleled opportunities for both buyers and sellers. Despite past challenges, Miami’s real estate sector has displayed remarkable resilience and attracted investors and buyers who recognize the long-term value and growth potential not only in luxury housing but also in other price ranges.
In terms of the luxury market, this surge has turned Miami into a sought-after destination for luxury real estate investment, thanks to its desirable location, stunning properties, and favorable tax environment. With a thriving market, it offers a promising landscape for buyers seeking a luxurious lifestyle and sellers aiming to benefit from high demand and strong prices in Miami’s luxury housing market
For other price ranges, the market will continue to move and right now is getting more difficult with low inventory. Condos are getting more inventory month over month, but houses? Not really.
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