So numbers are here! We got the new data, new records, and pretty interesting headline news. In May, Miami Dade County posted its 10th highest total existing home sales in history regardless of higher mortgage rates, lower supply, and higher sale prices.
On the other hand, in May 2022 total home sales decreased year-over-year (3,198 in May 2022 vs. 3,536 in May 2021). Additionally, Miami Dade prices hit record prices in May.
So, regardless of higher mortgage rates, lower supply, and higher sale prices the Miami real estate market broke records again in May but at the same time, the total home sales decreased. What does that mean? Even though it was still considered a strong May, the total home sales decreased and that is what experts are starting to see nationwide. But wait, is the Miami market still a seller’s market? Are we seeing changes in Miami? Keep reading to find out.
In other markets/areas are reporting a decrease in offers received, also seeing over-asking offers decrease, a decrease in sales, and an increase in inventory. They are also reporting new listings to increase at a faster pace, a slower pace compared to a year ago but going back to the pre-pandemic pace. And of course, Miami won’t be the exception.
According to MIAMI Chairman of the Board Fernando Arencibia Jr. “The rapid rise in mortgage rates, from an average of 3% to 6% over the past six months, is tempering Miami real estate’s historic pace. Although top sales marks are still being achieved, higher rates are starting to restore balance to the market. For the first time since July 2019, Miami’s single-family home inventory rose year-over-year. Look for fewer bidding wars, more days on market, and a cooling of the growth rate of pricing in the months ahead.”
The median sale price for a single-family home is showing an increase of 15% from last year now being at $575,000 and an increase of 1.8% from April with $565,000. This increase is pretty interesting since we know interest rates have been increasing.
We want to keep tracking and see the next 2 month’s data because we had a big jump in rates in June. Plus these properties went under contract 1 or 2 months ago.
Once again in May, we saw the median percentage of the original list price to be at 100% been at 100% for 3 months in a row, an indicator of a very competitive market.
The luxury market also took a hit. Miami single-family luxury homes decreased 5.1% year-over-year to 258 sales in May 2022 because of low inventory and the existing condo luxury sales rose 8.8% year-over-year in May 2022 to 322 transactions, which are in a record-high range.
As far as the median time to contract remained the same with 14 days and months’ supply of inventory (pay attention to this interesting point) months’ supply of inventory for single-family homes increased month over month to 2.2 from 1.9.
In other words, we are seeing or we are on the way of seeing what other markets are reporting, an increase in inventory at a faster pace.
Miami’s existing condo sales decreased 7.9% from last year to 2,005.
The median sales price for condos increased 27.7% from last year to $415,000 in May and increased 6.4% from April with $390,000.
The median time to contract in May decreased to 21 days.
Months’ supply of inventory for condos also increased to 2.5 months, a decrease of 58.3% from last year but is the first increase in inventory since last year. We are definitely starting to see a subtle change in the Miami market.
Even though we are in the 6% of interest rate, that is still low compared to an all-time average of about 8% in the U.S. However, that increase means the monthly payment of a $300,000 mortgage has risen from $1265 in December to $1800 today, according to NAR to give you an example.
With higher the rates and more days on the market the properties would be will gives buyers more choices. And, higher rates will eventually lead to moderate growth of the rate of pricing.
With the growth rate of pricing cooling, total inventory could grow later and there is where we are going to see the change other markets are already reporting. I listen to different experts in the field and the true experts have been saying we are going to start seeing a change, yes, but towards what the market was before 2020 because definitely 2020 and 2021 were two completely different years.
There is so much data to compare and to show that this is not 2008-2010. I am actually doing a video on just this topic. All the craziness people are saying of a market crash, of mortgage rates, and what experts are seeing predicting or not in this market. That is my next video so stay tuned for this great video on my YouTube Channel.
As always, if you would like to download the full report provided by the Miami Realtors I’ve posted the links down 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 here
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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