According to the Miami Association of Realtors, Broward County Florida total home sales surged in September 2020.
Broward County total home sales jumped 14.5% year-over-year, from 2,606 to 2,984. Broward single-family home sales jumped 24.9% year-over-year, from 1,229 to 1,535. Broward existing condo transactions increased 5.2% year-over-year, from 1,377 to 1,449.
"The resiliency of Broward real estate continues to shine as home sales surged double digits and months supply of inventory decreased," Broward Miami President Sharon R. Lindblade said. "Broward County is home to a robust seller's market with just 2.6 months of supply of single-family homes."
Mortgage applications to purchase are 24% higher annually, according to the Oct. 14 Mortgage Bankers Association's seasonally adjusted index. The global COVID-19 situation has accelerated the trend of homebuyers from New York and cold weather and tax-burdened Northeastern states searching and purchasing homes in South Florida.
Strong Price Appreciation in Broward
Strong demand coupled with limited supply continue to drive price appreciation in Broward.
Broward County single-family home prices increased 15.6% year-over-year in September 2020, increasing from $367,500 to $425,000. Existing condo prices increased 11.8% year-over-year, from $170,000 to $190,000.
Mid-Market and Luxury Home Sales Jump in September 2020
Broward single-family homes priced between $400K to $600K surged 44.9% year-over-year to 481 transactions in September 2020. Broward existing condo sales priced between $400K to $600K increased 5.1% to 62 transactions.
Broward single-family luxury ($1-million-and-up) transactions jumped 204.3% year-over-year to 143sales in September 2020. Broward existing condo luxury ($1-million-and-up) sales stayed even year-over-year at 13 transactions.
Record-low interest rates; a record-high S&P 500; the appeal of stable assets in a volatile economy; homebuyers leaving tax-burdened Northeastern states to purchase in Florida (no state income tax); and work-from-home and remote-learning policies have all combined to create a robust market for luxury single-family properties.
Single-Family Home Dollar Volume Increases
Single-family home dollar volume increased 63.8% year-over-year, from $533.1 million to $873.4 million. Condo dollar volume increased 15.5% year-over-year, from $292.4 million to $337.8 million.
According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage decreased to 2.89% in September, down from 2.94% in August. The average commitment rate across all of 2019 was 3.94%.
Lack of access to mortgage loans continues to inhibit further growth of the existing condominium market. Of the 9,307 condominium buildings in Miami-Dade and Broward counties, only 13 are approved for Federal Housing Administration loans, down from 29 last year, according to Florida Department of Business and Professional Regulation and FHA.
A new condo approval process is expected to increase sales. The new guidance, which went into effect in October 2019, extends certifications from two years to three, allows for single-unit mortgage approvals, provides more flexibility with owner/occupancy ratios, and increases the allowable number of FHA loans in a single project. The changes, many of which MIAMI and NAR has championed, are expected to generate increased homeownership opportunities.
Only 2.6% of all closed residential sales in Broward were distressed last month, including REO (bank-owned properties) and short sales, compared to 3.4% in September 2020.
Total Miami distressed sales decreased 11.2%, from 89 to 79.
Short sales and REOs accounted for 0.6% and 2% year-over-year, respectively, of total Broward sales in September 2020. Short sale transactions decreased 14.3% year-over-year while REOs decreased 10.3%.
Nationally, distressed sales represented less than 1% of sales in September, equal to August's percentage but down from 2% in September 2019.
Broward Real Estate Selling Close to List Price
The median percent of original list price received for single-family homes was 97.1% in September, up 0.9% from 96.2% last year. The median percent of original list price received for existing condominiums was 95.2%, up 0.8% from 94.4% last year.
The median number of days between listing and contract dates for Miami single-family home sales was 21 days, a 54.3% decrease from 46 days last year. The median number of days between the listing date and closing date for condos was 43 days, down 21.8% from 55 days.
The median time to sale for single-family homes was 67 days, a 25.6% decrease from 90 days last year. The median number of days to sale for condos was 86 days, a 11.3% decrease from 97 days.
Broward's Cash Buyers Top National Figure
Broward cash transactions comprised 28.8% of September 2020 total closed sales, compared to 33.8% last year. The national figure for cash buyers is 18%.
Broward's high percentage of cash sales reflects South Florida's ability to attract a diverse number of international homebuyers, who tend to purchase properties in all cash.
Condominiums comprise a large portion of Broward's cash purchases as 42.9% of condo closings were made in cash in September 2020 compared to 15.4% of single-family home sales.
Seller's Market for Single-Family Homes, Balanced Market for Condos
Inventory of single-family homes decreased 39.3% in September from 5,330 active listings last year to 3,234 last month. Condominium inventory increased 1.7% to 7,784 from 7,655 listings during the same period in 2019.
Months supply of inventory for single-family homes decreased 36.6% to 2.6 months, which indicates a seller's market. Inventory for existing condominiums increased 18.2% to 6.5 months, which indicates a balanced market. A balanced market between buyers and sellers offers between six- and nine-months supply.
Total active listings at the end of September decreased 15.1% year-over-year, from 12,985 to 11,018. Active listings remain about 60% below 2008 levels when sales bottomed.
New listings of Broward single-family homes increased 13.5% to 1,827 from 1,609. New listings of condominiums increased 23.1%, from 1,807 to 2,225.