Miami’s real estate market is often described as one of the most competitive and cut-throat in the United States. With luxury high-rises, exclusive waterfront properties, and some of the most sought-after neighborhoods in the country, it’s no wonder that buyers and sellers alike are flocking to the Magic City to capitalize on the booming market. But with so much competition, navigating the ins and outs of Miami’s real estate market can be a daunting task. In this blog post, we’ll explore the ultimate battleground of Miami’s real estate market.
How is this hot market in Miami even possible again?
As a future buyer, I’m sorry to say that the news isn’t great. In this latest Miami housing update, I’ll be discussing 5 key points that will leave you reeling: pending sales, showing appointments, median time to contract, median percent of original list price received, and months supply of inventory. Trust me, all of them are crazy indicators of what we could see or not in this market with not much inventory and higher interest rates.
In Miami, FL we are seeing bidding wars, multiple offers, some over asking offers in Miami’s real estate market at this moment but why? Why again if the rates are higher than 2 years ago. Well, first of all, there are people who need to buy or to sell. Either the family is growing or the house is too big. The real estate will always continue to move. People will always need housing. Could be slower, yes, but it will continue to move. And second, Miami is so attractive to both out of state buyer’s and people from other countries.
Last month total pending sales increased 10% month over month. And why do we need to track all of these numbers? Well, pending sales and showing appointments are some indicators of how hot our market is. Seeing a continuous increase in pending sales and a 14% increased month over month of showing appointments are very alarming news for future buyers. These two means more real estate transactions are happening, more movement with the showing appointments. If you are on the fence of buying, you need to be aware of what you could possibly face if you find the right property so you don’t either lose it or waste time.
The next points are median time to contract, median percent of original list price received, and months supply of inventory. Let’s consider all of these 3 factors month over month and not yearly data since we want to see how hot the Miami market is turning or not. Median time to contract was 35 days in March,and 46 days in February. For the last months, since last year actually, this measure has been increasing and of course that happened when the mortgage rates were increasing. However, this is the first time over a year that this measure decreases. Decreased 24% month over month. That is a huge decrease because this is measuring the median number of days between the listing date and contract date. In other words, properties are kind of flying again.
As far as the median percent of original list price received which measures the market recovery as either the market is moving away from buyers so they need or not match or better the selling price, also increased from the previous month 0.6% increase from 95.1% to 95.7% second month in a row of increases since two years ago. And can you guess what happened with the months supply of inventory in the latest data? After seeing the previous data, can you guess what happened? Well… maybe you guessed right… For the second month in a row, the supply decreased. Months supply of inventory decreased to 3.5 coming from 3.8 and 4 the previous months for single family homes. Again, all 3 indicators of a hot market.
Moving on, the median sale price for single-family homes in Miami, FL has increased by 2.7% month over month to $570,000 in March 2023, up from $555,000 in February. Of course, this is great news for homeowners in the area who are looking to sell their properties.
But that’s not all – condos in Miami have also seen a significant increase in value, with the median sale price rising by 2.6% month over month to $400,000 in March. This is a testament to the overall strength of the Miami real estate market, which continues to thrive despite other markets.
In terms of total homes sold, in March Miami sold 8.6% more total homes than March 2019. This is a 0.9% increase for total single family homes sold and 15.4% increase for condos compared to 2019.
Now let’s talk a little about new listings and active listings on the Miami market.
New listings in Miami decreased 23.5% from last year. We are definitely not seeing much new inventory coming to the market which is important to track because the market is getting tougher. Same with the active listings, active listings are decreasing as well. Everything is giving us indicatives of being a tough market for buyers once again in Miami. Are you watching this market update from another state thinking of moving over here? What are you seeing in your local market? Comment below, I would like to read you all your thoughts about this latest market update.
Moving on let me talk a bit about foreclosures which last week was crazy with lots of headlines about that. Here are some headlines for example:
Like “More Americans Are Losing Their Homes As Foreclosures On US Properties Rise”, then “Foreclosures Are On The Rise – Particularly In Illinois, Delaware, And New Jersey”, another one with “US Foreclosure Filings Jump 22%, And Repossessions Hit Highest Level In 3 Years” and last one “Foreclosures Jump – Is Another Wave About To Flood The Housing Market?” What? All of them are very alarming headlines right?
And they come from a recent article from Attom Data and yet, there have been over 1M fewer foreclosures in the last 3 years as you can see in the graph below.
But also, they did not look at the most important graph from that report. Which is the one below. Take a look at the history of foreclosures in the whole country and the latest data. Miami distressed sales remain low, 1.2% of all closed residential sales in Miami were distressed in March compared to 1.3% last year and numbers are similar to national numbers. Nothing to worry at the moment with this point here. I wanted to talk about this because of those crazy headlines out there from a week or so ago.
Photo Credit: Attom Data Website
It’s clear that Miami’s real estate market is getting hotter with some multiple offers, and lines around the block again. If you ask me what I predict about the interest rates, I think they will decrease more in order for Sellers to sell. We need more inventory and maybe a way around that is for the rates to drop. As of 4/20/23 mortgage rates were at 6.39% showing a sign of increases for now, but again, I think they will decrease later this year.
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