MIAMI — Miami-Dade County total home sales surged in September 2020 as a jump in mid-market and luxury home transactions pushed the resilient market to new heights, according to the MIAMI Association of Realtors (MIAMI) and the Multiple Listing Service (MLS) system.
Miami-Dade County total home sales jumped 12.5% year-over-year, from 2,240 to 2,521. Miami single-family home sales jumped 19.3% year-over-year, from 1,080 to 1,288. Miami existing condo transactions increased 6.3% year-over-year, from 1,160 to 1,233.
“The pandemic continues to accelerate trends that were already apparent in the South Florida market, including affluent buyers from high-tax and high-density states purchasing in South Florida,” MIAMI Chairman of the Board Jorge L. Guerra Jr. said. “Home sales are not only increasing by double digits, but properties are going under contract significantly faster than last year, a sign of the robust demand for Miami real estate.”
The median number of days between listing and contract dates for Miami single-family home sales in September 2020 was just 32 days, a 43.9% decrease from 57 days last year. The Miami single-family homes inventory has now decreased for 14 consecutive months and has 3.8 months supply of inventory, a strong seller’s market.
Mortgage applications to purchase are 24% higher annually, according to the Oct. 14 Mortgage Bankers Association’s seasonally adjusted index. The 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.
Before the COVID-19 situation, the Miami-Dade market was exceptionally strong. 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.
106 Consecutive Months of Price Appreciation in Miami
Strong demand coupled with limited supply continue to drive price appreciation in Miami-Dade.
Miami-Dade County single-family home prices increased 15.2% year-over-year in September 2020, increasing from $377,750 to $435,000. Miami single-family home prices have risen for 106 consecutive months, a streak of 8.8 years. Existing condo prices increased 8.2% year-over-year, from $245,000 to $265,000. Condo prices have increased or stayed even in 108 of the last 112 months.
Miami, where the median price is still comparable to 2007 figures, remains a bargain compared to other global cities. In Miami, $1 million can net homebuyers 93 square meters of prime property, according to Knight Frank’s 2019 The Wealth Report. Monaco (16 square meters), Hong Kong (22), New York (31), Los Angeles (36) and others offer significantly less prime land for $1 million.
Mid-Market and Luxury Home Sales Jump in September 2020
Miami single-family homes priced between $400K to $600K surged 40.9% year-over-year to 365 transactions in September 2020. Miami existing condo sales priced between $400K to $600K increased 34.9% to 85 transactions.
Miami single-family luxury ($1-million-and-up) transactions jumped 76.7% year-over-year to 159 sales in September 2020. Miami existing condo luxury ($1-million-and-up) sales increased 34.9% year-over-year to 85 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 55% year-over-year, from $629.5 million to $975.8 million. Condo dollar volume increased 26.3% year-over-year, from $428.6 million to $490.8 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.
Miami Distressed Sales Stay Low, Reflecting Healthy Market
Only 2.9% of all closed residential sales in Miami were distressed last month, including REO (bank-owned properties) and short sales, compared to 5.8% in September 2020. In 2009, distressed sales comprised 70% of Miami sales.
Total Miami distressed sales decreased 43.8%, from 130 to 73.
Short sales and REOs accounted for 0.9% and 1.9% year-over-year, respectively, of total Miami sales in September 2020. Short sale transactions decreased 17.9% year-over-year while REOs decreased 50.9%.
Nationally, distressed sales represented less than 1% of sales in September, equal to August’s percentage but down from 2% in September 2019.
Miami Real Estate Selling Close to List Price
The median percent of original list price received for single-family homes was 96.7% in September, up 1.5% from 95.3% last year. The median percent of original list price received for existing condominiums was 94.4%, up 0.7% from 93.7% last year.
The median number of days between listing and contract dates for Miami single-family home sales was 32 days, a 43.9% decrease from 57 days last year. The median number of days between the listing date and closing date for condos was 60 days, down 31% from 87 days.
The median time to sale for single-family homes was 84 days, a 19.2% decrease from 104 days last year. The median number of days to sale for condos was 100 days, a 21.9% decrease from 128 days.
National and State Statistics
Nationally, total existing-home sales transactions completed transactions that include single-family homes, townhomes, condominiums and co-ops, rose 9.4% from August to a seasonally-adjusted annual rate of 6.54 million in September. Overall sales rose year-over-year, up 20.9% from a year ago (5.41 million in September 2019).
Statewide, sales of single-family homes rose 22% year-over-year, totaling 28,675, while existing condo-townhouse sales increased 25.3% over September 2019 and totaled 11,290. Closed sales may occur from 30- to 90-plus days after sales contracts are written.
The national median existing-home price for all housing types in September was $311,800, up 14.8% from September 2019 ($271,500), as prices rose in every region. September’s national price increase marks 103 straight months of year-over-year gains.
The statewide median sales prices for both single-family homes and condo-townhouse properties rose year-over-year in September for 105 consecutive months. The statewide median sales price for single-family existing homes was $300,000, up 13.2% 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 $217,500, up 12.7% over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.
Miami’s Cash Buyers Top National Figure
Miami cash transactions comprised 26.9% of September 2020 total closed sales, compared to 33.9% last year. The national figure for cash buyers is 18%.
Miami’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 Miami’s cash purchases as 39% 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, Buyer’s Market for Condos
Inventory of single-family homes decreased 37.3% in September from 6,444 active listings last year to 4,039 last month. Condominium inventory decreased 6.6% to 15,142 from 14,148 listings during the same period in 2019.
Months supply of inventory for single-family homes decreased 35.6% to 3.8 months, which indicates a seller’s market. Inventory for existing condominiums increased 6.2% to 13.8 months, which indicates a buyer’s market. A balanced market between buyers and sellers offers between six- and nine-months supply.
Months supply of inventory is down since July 2019 for single-family, reflecting strong demand.
Total active listings at the end of September decreased 15.7% year-over-year, from 21,586 to 18,187. Active listings remain about 60% below 2008 levels when sales bottomed.
New listings of Miami single-family homes increased 0.8% to 1,632 from 1,619. New listings of condominiums increased 20.4%, from 2,028 to 2,442.
Inventory of active listings has decreased the last 14 months for single-family homes.
Nationally, total housing inventory at the end of September totaled 1.47 million units, down 1.3% from August and down 19.2% from one year ago (1.82 million). Unsold inventory sits at a 2.7-month supply at the current sales pace, down from 3.0 months in August and down from the 4.0-month figure recorded in September 2019.
To access September 2020 Miami-Dade Statistical Reports, visit http://www.SFMarketIntel.com
Note: Statistics in this news release may vary depending on reporting dates. MIAMI reports exact statistics directly from its MLS system.
About the MIAMI Association of Realtors
The MIAMI Association of Realtors was chartered by the National Association of Realtors in 1920 and is celebrating 100 years of service to Realtors, the buying and selling public, and the communities in South Florida. Comprised of six organizations, the Residential Association, the Realtors Commercial Alliance, the Broward-MIAMI Association of Realtors, the Jupiter Tequesta Hobe Sound (JTHS-MIAMI) Council, the Young Professionals Network (YPN) Council and the award-winning International Council, it represents 52,000 total real estate professionals in all aspects of real estate sales, marketing, and brokerage. It is the largest local Realtor association in the U.S. and has official partnerships with 223 international organizations worldwide.