The greater Miami real estate market experienced a 28.1% year-over-year home sales decrease in September 2022, diving from 3,031 homes sold last September to 2,178 last month, because of rising mortgage rates and low inventory.
Single-family home sales decreased 30% year-over-year, from 1,241 in record-breaking September 2021 to 869 in September 2022, due to lack of inventory and rising mortgage rates. Miami existing condo sales decreased 26.9% year-over-year, from 1,790 record-breaking September 2021 to 1,309 in September 2022, due to lack of inventory and rising mortgage rates.
The Fed, which voted for another Fed Funds rate increase in September, is intent on slowing 40-year high inflation. While the Fed doesn't set mortgage rates, it affects them through its conduct of monetary policy. As a result, the 30-year fixed mortgage rate has fluctuated from 2.99% to 6.92% in the last 52 weeks, an unprecedented range of volatility.
September 2022 marks the seventh consecutive month of 5% or higher mortgage rates. According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage was 6.11% in September, up from 5.22% in August. The average commitment rate across all of 2021 was 2.96%.
Housing is sensitive to rising mortgage rates. 2018 marked the last time mortgage rates hit 5%. Miami September 2022 total home sales finished 7.9% higher than September 2018 (2,019 vs. 2,178).
Miami Single-Family Inventory Rises for Fifth Consecutive Month While Condos Decreased
Inventory of single-family homes increased 32.3% year-over-year in September 2022 from 2,957 active listings last year to 3,912 last month. Condominium inventory dropped 20.5% year-over-year to 6,399 from 8,049 listings during the same period in 2021.
New listings of Miami single-family homes decreased 15.6% to 1,351 from 1,601. New listings of condominiums decreased 24.5%, from 2,460 to 1,858.
Months' supply of inventory for single-family homes increased 59.1% to 3.5 months year-over-year, which indicates a seller's market. Inventory for existing condominiums decreased 18.6% to 3.5 months, which also indicates a seller's market. A balanced market between buyers and sellers offers between six- and nine-months supply.
Total active listings at the end of September 2022 decreased 6.3% year-over-year, from 11,006 to 10,311.
Nationally, total housing inventory at the end of September was 1.25 million units, which was down 2.3% from August and 0.8% from the previous year. Unsold inventory sits at a 3.2-month supply at the current sales pace - unchanged from August and up from 2.4 months in September 2021.
Miami total dollar sales volume totaled $1.6 billion in September 2022. Single-family home dollar volume decreased 36.1% year-over-year, from $1.2 billion to $759.6 million. Condo dollar volume decreased 15.3% year-over-year, from $982.9 million to $832.8 million.
Miami Distressed Sales Remain Low, Reflecting Healthy Market
Total Miami distressed sales decreased 49.1% in September 2022, from 55 to 28. Short sales and REOs accounted for 0.4% and 0.9% year-over-year, respectively, of total Miami sales in September 2022. Short sale transactions decreased 60% year-over-year while REOs decreased 42.9%.
Only 1.2% of all closed residential sales in Miami were distressed last month, including REO (bank-owned properties) and short sales, compared to 1.8% in September 2021. In 2009, distressed sales comprised 70% of Miami sales.
Miami's percentage of distressed sales are on par with the national figure. Nationally, distressed sales represented approximately 2% of sales in September, a marginal increase from 1% in September 2021.
Miami's Percentage of Sales Continue to Outpace the Nation, State
In Florida, closed sales of single-family homes statewide totaled 20,099 in September 2022, down 29% year-over-year, while existing condo-townhouse sales totaled 8,406, down 29%. Closed sales may occur from 30- to 90-plus days after sales contracts are written.
Nationally, total existing-home sales transactions retracted 1.5% from August to a seasonally adjusted annual rate of 4.71 million in September. Year-over-year, sales waned by 23.8% (down from 6.18 million in September 2021).
The statewide median sales price for single-family existing homes was $403,880, up 13.8% from the previous year, according to data from Florida Realtors Research Department in partnership with local Realtor boards/associations. Last month's statewide median price for condo-townhouse units was $307,250, up 20.5% over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.
Nationally, the median existing-home price for all housing types in September was $384,800, an 8.4% jump from September 2021 ($355,100), as prices climbed in all regions. This marks 127 consecutive months of year-over-year increases, the longest-running streak on record.
Miami Real Estate Attracting Multiple Bids, Buyers Going Over-List Price
The median percent of original list price received for single-family homes was 96.6% in September 2022, down 2% from 98.6% last year. The median percent of original list price received for existing condominiums was 97.2%, down 0.1% from 97.3% last year.
The median number of days between listing and contract dates for Miami single-family home sales was 24 days, up from 18 days last year. The median time to sale for single-family homes was 68 days, a 3% increase from 66 days last year.
The median number of days between the listing date and contract date for condos was 28 days, down 20% from 35 days. The median number of days to sale for condos was 71 days, a 13.4% decrease from 82 days.
Miami Cash Sales 79.5% More than National Figure in September 2022
Cash sales represented 39.5% of Miami closed sales in September 2022, compared to 37.3% in September 2021. About 22% of U.S. home sales are made in cash, according to the latest NAR statistics.
Cash buyers are not deterred by rising rates. 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.
Cash sales accounted for 49.6% of all Miami existing condo sales and 24.3% of single-family transactions.