MIAMI — Miami-Dade County median prices increased year-over-year in April 2020 as home sales saw expected declines as a result of the global COVID-19 situation, according to the MIAMI Association of Realtors (MIAMI) and the Multiple Listing Service (MLS) system.
“Despite the expected COVID-19 impact on April sales, we are already seeing a surge in pending sales that will result in a significant increase in closed sales in the next couple of months,” MIAMI Chairman of the Board Jorge L. Guerra Jr. said. “With stay-at-home orders ending and South Florida slowly reopening, listings and buying activity has definitely rebounded. Pent-up demand, historically low mortgage rates and the robust fundamentals of the South Florida housing market is already leading to increased buying activity.”
The market bottomed in mid-April and surging pending sales should result in sales increases in the next couple of months. South Florida Realtors are seeing a rise in mortgage applications and additional homebuying interest from the Northeast. Nationally, mortgage applications to purchase a home rose 6% last week from the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.
The COVID-19 situation has accelerated the trend of homebuyers from New York and other 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.
101 Consecutive Months of Price Appreciation in Miami
Miami-Dade County single-family home prices increased 7.3% year-over-year in April 2020, increasing from $356,000 to $382,000. Miami single-family home prices have risen for 101 consecutive months, a streak of 8-plus years. Existing condo prices increased 6.9% year-over-year, from $248,000 to $265,000. Condo prices have increased or stayed even in 103 of the last 107 months.
Despite the price increase, 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.
Miami Total Home Sales Decrease
Miami total home sales decreased 40.1% year-over-year in April 2020, from 2,629 to 1,576. Miami single-family home sales decreased 31.6% year-over-year in April 2020, from 1,265 to 865. Miami existing condo transactions declined 47.9% year-over-year in April 2020, from 1,364 to 711.
Real estate was deemed essential in Florida, but COVID-19-induced shutdowns in South Florida eliminated the traditional open house, one of the most valuable tools in selling a property. Realtors pivoted to using virtual open houses and tours. MIAMI REALTORS hosted a South Florida Virtual Open House Showcase from May 1-10 where Realtors added more than 2,000 virtual open houses and virtual tours. SouthFloridaOpenHouseSearch.com attracted more than 28,000 visitors and 90,000-page views during the Showcase. The Virtual Open House Showcase relaunches MIAMI’s South Florida Virtual Open House Program virtually.
MIAMI is hosting its second South Florida Virtual Open House Showcase (SouthFloridaOpenHouseSearch.com) event on May 22-25 to provide consumers virtual access to property tours, open houses, and direct interaction with Realtors and other industry experts.
Dollar Volume Decreases
Single-family home dollar volume decreased 24.2% year-over-year, from $671 million to $508.6 million. Condo dollar volume decreased 46.8% year-over-year, from $557.8 million to $296.9 million.
According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage decreased to 3.31% in April, down from 3.45% in March. 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 4.2% of all closed residential sales in Miami were distressed last month, including REO (bank-owned properties) and short sales, compared to 6.1% in April 2020. In 2009, distressed sales comprised 70% of Miami sales.
Total Miami distressed sales decreased 58.8%, from 160 to 66.
Short sales and REOs accounted for 0.9% and 3.2% year-over-year, respectively, of total Miami sales in April 2020. Short sale transactions decreased 55.9% year-over-year while REOs decreased 59.5%.
Nationally, distressed sales represented 3% of sales in x, up from x% in April, about even with both March 2020 and April 2019.
Miami Real Estate Selling Close to List Price
The median percent of original list price received for single-family homes was 96% in April, up 0.5% from 95.5% last year. The median percent of original list price received for existing condominiums was 94.4%, up 1.1% from 93.4% last year.
The median number of days between listing and contract dates for Miami single-family home sales was 39 days, a 32.8% decrease from 58 days last year. The median number of days between the listing date and closing date for single-family homes was 83 days, a 17.8% decrease from 101 days.
The median time to contract for condos was 52 days, a 29.7% decrease from 74 days last year. The median number of days between the listing date and closing date for condos was 96 days, a 16.5% decrease from 115 days.
National and State Statistics
Nationally, total existing-home sales transactions dropped 17.8% from March to a seasonally-adjusted annual rate of 4.33 million in April. Overall, sales decreased year-over-year, down 17.2% from a year ago (5.23 million in April 2019).
In April, statewide closed sales of existing single-family homes dropped 20.7% year-over-year, totaling 21,403 while condo-townhouse sales declined 36.5%, for a total of 7,506. 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 April was $286,800, up 7.4% from April 2019 ($267,000), as prices increased in every region. April’s national price increase marks 98 straight months of year-over-year gains.
In April, the statewide median sales prices for both single-family homes and condo-townhouse properties rose year-over-year for 100 months in a row. The statewide median sales price for single-family existing homes was $275,000, up 6% 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 $209,000, up 7.7% 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 22.1% of April 2020 total closed sales, compared to 34.8% last year. The national figure for cash buyers is 15%.
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 34.2% of condo closings were made in cash in April 2020 compared to 12.3% of single-family home sales.
Seller’s Market for Single-Family Homes, Buyer’s Market for Condos
Inventory of single-family homes decreased 12.4% in April from 6,935 active listings last year to 6,076 last month. Condominium inventory decreased 9% to 16,049 from 14,599 listings during the same period in 2019.
Months supply of inventory for single-family homes decreased 13.8% to 5.6 months, which indicates a seller’s market. Inventory for existing condominiums decreased 7.9% to 12.8 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 and since March 2019 for condos, reflecting strong demand.
Total active listings at the end of April decreased 10% year-over-year, from 22,984 to 20,675. Active listings remain about 60% below 2008 levels when sales bottomed.
New listings of Miami single-family homes decreased 42.5% to 1,097 from 1,909. New listings of condominiums decreased 44.9%, from 2,297 to 1,266.
Inventory of active listings has decreased the last eight months for condos and the last nine months for single-family.
Nationally, total housing inventory at the end of April totaled 1.47 million units, down 1.3% from March, and down 19.7% from one year ago (1.83 million). Unsold inventory sits at a 4.1-month supply at the current sales pace, up from 3.4-months in March and down from the 4.2-month figure recorded in April 2019.
To access April 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. MIAMI’s official website is www.MiamiRealtors.com