Greater Miami Area Home, Condo Sales Enjoy Robust Annual Price Increases in Q1
According to the Miami Association of Realtors, Miami-Dade County total home sales and prices increased year-over-year in 1Q 2020. Miami total home sales increased 6.8% year-over-year, from 5,659 to 6,042. Miami single-family home sales rose 7.9%, from 2,662 to 2,871. Miami existing condo sales increased 5.8%, from 2,997 to 3,171.
"The Miami real estate market continued its solid expansion through the first quarter of 2020," MIAMI Chairman of the Board Jorge L. Guerra Jr. said. "The robust fundamentals of the South Florida housing market in the first quarter are already minimizing the impact of COVID-19 on sales activity and demand. We are seeing sales, pending contracts and listings again trend upwards and expect there will be pent-up demand later in the year. Demand and insufficient supply, particularly in certain price ranges and neighborhoods, will continue to generate price appreciation."
Miami real estate had record low delinquencies, no subprime mortgage crisis, strong demand/low supply, low interest rates, strong population growth, demand from foreign buyers and tax refugees from tax burdened states, high consumer confidence and a strong job market.
Total Miami Sales Volume Jump in 1Q 2020
Miami single-family home dollar volume rose 8.3%, from $1.4 billion to $1.6 billion. Miami condo dollar volume increased 4.7% to $1.3 billion. The sales do not include Miami's multi-billion-dollar new construction condo market.
Non-distressed sales comprised about 94.5% of all closed residential sales in 1Q 2020 vs. 92.9% in 1Q 2019. Only 5.5% of all closed residential sales in Miami were distressed in 1Q 2020, including REO (bank-owned properties) and short sales, compared to 7.1% in 1Q 2019. In 2009, distressed sales comprised nearly 70 percent of Miami sales.
Short sales and REOs accounted for 1.1 and 4.4%, respectively, of total Miami sales in 1Q 2020. Short sale transactions decreased 5.9% year-over-year while REOs fell 19.8%.
Mid-Market and Luxury Sales Fuel 1Q Transaction Growth
Miami single-family homes priced between $400K to $600K increased 30.2% year-over-year to 685 transactions in 1Q 2020. Miami condo sales priced between $300K to $400K rose 30.8% year-over-year to 510 transactions in 1Q 2020.
Miami single-family home luxury ($1 million and up) transactions increased 22.4% to 240 sales in 1Q 2020. Miami condo luxury transactions rose 10.3% to 192 sales in 1Q 2020.
Lower mortgage rates made home purchases more affordable in both 2019 and in the first quarter of 2020. The 30-year fixed-rate averaged 3.57% in the first quarter of 2020, down from 4.62% one year ago. The average monthly mortgage payment on a 30-year fixed-rate mortgage with a 20% down payment was $995, down from $1,048 a year ago. This is equivalent to 15% of the median family income of $79,662, down from 16.1% one year ago. (Housing expenses are considered a cost burden if the cost is more than 30% of income.)
Miami Median Prices Rise for 33rd Consecutive Quarter
The median price for single-family homes in Miami-Dade County increased to $375,000 in 1Q 2020, a 7.1% jump from $350,000 in the same period last year. The median price for existing condominiums increased 7.5% year-over-year from $240,000 to $257,975. Miami's median prices have now increased for 33 consecutive quarters, a streak spanning 8.25 years.
The statewide median sales price for single-family existing homes in 1Q 2020 was $270,000, up 6.7% from the same time a year ago, according to data from the Florida Realtors Research department in partnership with local Realtor boards/associations. The statewide median price for condo-townhouse properties during the quarter was $205,000, up 10.5% over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.
Nationwide, median single-family home prices increased year-over-year in 96% of measured markets in the first quarter, with 174 of 181 metropolitan statistical areas1 showing sales price gains. That is an increase from the 94% share seen in the fourth quarter of 2019. The national median existing single-family home price in the first quarter of 2020 was $274,600, up 7.7% from the first quarter of 2019 ($254,900).
Hot Markets Overview Reveals Strong Demand and Limited Supply in Many Local Areas
Months' supply of inventory is a strong indicator of real estate activity. Top Miami neighborhoods with the lowest months of supply of inventory (at least 100 new pending sales) in 1Q 2020:
1. Cutler Bay, a town in south Miami-Dade County, had 2.9 months supply.
2. Miami Gardens, a city in north Miami-Dade north of Opa-locka, had 3.0 months supply.
3. The Hammocks, a community in south Miami-Dade east of The Crossings, had 3.4 months supply.
4. Princeton, a community in south Miami-Dade south of Cutler Bay, had 3.5 months supply.
5. Kendall, a south Miami-Dade community west of Pinecrest, had 4.4 months supply.
1. Kendale Lakes, a south Miami-Dade community west of South Miami, had 2.6 months supply.
2. The Hammocks, a community in south Miami-Dade east of The Crossings, had 3.1 months supply.
3. Kendall, a south Miami-Dade community west of Pinecrest, had 3.1 months supply.
4. Fountainbleau, a community in south Miami-Dade County north of Westchester, had 3.7 months supply
5. Hialeah, a city in north Miami-Dade west of Miami Shores, had 4.0 months supply.
State Home Sales in 1Q 2020
Closed sales of single-family homes statewide totaled 65,602 in 1Q 2020, up 10.2% from the 1Q 2019 level. Looking at Florida's condo-townhouse market, statewide closed sales totaled 27,379 during 1Q 2020, up 9.3% compared to 1Q 2019. Closed sales typically occur 30 to 90 days after sales contracts are written.
Seller's Market for Single-Family Homes, Buyer's Market for Condos At the current sales pace, the number of active listings represents 5.5 months of inventory for single-family homes and 12.5 for condominiums. A balanced market between buyers and sellers offers between six and nine months of supply inventory.
Miami real estate had 21,052 active listings in 1Q 2020, a 10.3% decrease from the 23,465 listings at the same time last year. The inventory for single-family homes decreased 12%, from 7,064 to 6,216. Miami existing condo inventory decreased 9.5%, from 16,401 to 14,836.
Miami Homes Selling Close to List Price
The median percent of original list price received was 95.7% for single-family homes and 93.9% for condos in 1Q 2020.
The median time to contract for single-family home listings was 56 days, an 8.2% decrease from 61 days in 1Q 2019. The median time to contract for existing condos was 84 days, a 7.7% increase from 78 days in 1Q 2019.
The median time to sale for single-family homes decreased 6.5%, from 107 days to 100. The median time to sale for existing condos increased 5.9%, from 119 to 126.
Miami Cash Sales Almost Double National Figure
Cash sales represented 34.3% of Miami closed sales in 1Q 2020, compared to 37.5% in 1Q 2019.
About 20 percent of U.S. home properties are made in cash, according to the latest NAR statistics. 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.
Cash sales accounted for 47.9% of all Miami existing condo sales and 19.3% of single-family transactions.