Miami-Dade County total home sales surged in October 2020 as strong pent-up demand and record-low mortgage rates fueled transactions, according to the MIAMI Association of Realtors (MIAMI) and the Multiple Listing Service (MLS) system.
Miami-Dade County total home sales jumped 16.2% year-over-year, from 2,355 to 2,737. Miami single-family home sales jumped 15.7% year-over-year, from 1,146 to 1,326. Miami existing condo transactions increased 16.7% year-over-year, from 1,209 to 1,411.
“Miami single-family home sales have now posted double-digit, year-over-year increases for three consecutive months and Miami existing condos have posted transaction gains for two straight months,” MIAMI Chairman of the Board Jorge L. Guerra Jr. said. “Robust pent-up demand, record-low mortgage rates and purchases from tax-burdened Northeastern home buyers are fueling a resilient Miami real estate market.”
Miami Luxury Home Sales Surge 122.1% in October 2020
Miami single-family homes priced between $400K to $600K surged 52.5% year-over-year to 424 transactions in October 2020. Miami existing condo sales priced between $400K to $600K increased 46.5% to 145 transactions.
Miami single-family luxury ($1-million-and-up) transactions jumped 122.1% year-over-year to 171 sales in October 2020. Miami existing condo luxury ($1-million-and-up) sales increased 27% year-over-year to 80 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.
107 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 19.2% year-over-year in October 2020, increasing from $365,000 to $435,000. Miami single-family home prices have risen for 107 consecutive months, a streak of 8.9 years. Existing condo prices increased 8.5% year-over-year, from $247,000 to $268,000. Condo prices have increased or stayed even in 109 of the last 113 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.
Single-Family Home Dollar Volume Increases
Single-family home dollar volume increased 75.5% year-over-year, from $563.1 million to $988.3 million. Condo dollar volume increased 19.4% year-over-year, from $460.7 million to $549.9 million.
According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage decreased to 2.83% in October, down from 2.89% in September. 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 2.6% of all closed residential sales in Miami were distressed last month, including REO (bank-owned properties) and short sales, compared to 6.4% in October 2020. In 2009, distressed sales comprised 70% of Miami sales.
Total Miami distressed sales decreased 52%, from 150 to 72.
Short sales and REOs accounted for 0.9% and 1.7% year-over-year, respectively, of total Miami sales in October 2020. Short sale transactions decreased 13.8% year-over-year while REOs decreased 61.2%.
Nationally, distressed sales represented less than 1% of sales in October, equal to September’s percentage but down from 2% in October 2019.
Miami Real Estate Selling Close to List Price
The median percent of original list price received for single-family homes was 97% in October, up 1.1% from 95.9% 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 28 days, a 44% decrease from 50 days last year. The median number of days between the listing date and closing date for condos was 62 days, down 12.7% from 71 days.
The median time to sale for single-family homes was 78 days, a 17.9% decrease from 95 days last year. The median number of days to sale for condos was 103 days, an 8.8% decrease from 113 days.
National and State Statistics
Nationally, total existing-home sales transactions completed transactions that include single-family homes, townhomes, condominiums and co-ops, increased 4.3% from September to a seasonally-adjusted annual rate of 6.85 million in October. Overall, sales rose year-over-year, up 26.6% from a year ago (5.41 million in October 2019).
In October, closed sales of single-family homes statewide totaled 29,659, up 26.9% year-over-year, while existing condo-townhouse sales totaled 12,110, up 30.3% over October 2019. 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 October was $313,000, up 15.5% from October 2019 ($271,100), as prices increased in every region. October’s national price increase marks 104 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 October for 106 consecutive months. The statewide median sales price for single-family existing homes was $305,000, up 15.6% 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 $221,000, up 15.9% 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 29.3% of October 2020 total closed sales, compared to 32.6% last year. The national figure for cash buyers is 19%.
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 40.5% of condo closings were made in cash in October 2020 compared to 17.5% of single-family home sales.
Seller’s Market for Single-Family Homes, Buyer’s Market for Condos
Inventory of single-family homes decreased 39.8% in October from 6,548 active listings last year to 3,941 last month. Condominium inventory decreased 8.4% to 14,004 from 15,295 listings during the same period in 2019.
Inventory of active listings has decreased the last 15 months for single-family homes.
Months supply of inventory for single-family homes decreased 38.3% to 3.7 months, which indicates a seller’s market. Inventory for existing condominiums increased 2.3% to 13.5 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 October decreased 17.8% year-over-year, from 21,843 to 17,945. Active listings remain about 60% below 2008 levels when sales bottomed.
New listings of Miami single-family homes decreased 13.2% to 1,593 from 1,835. New listings of condominiums increased 1.8%, from 2,354 to 2,396.
Nationally, total housing inventory at the end of October totaled 1.42 million units, down 2.7% from September and down 19.8% from one year ago (1.77 million). Unsold inventory sits at an all-time low 2.5-month supply at the current sales pace, down from 2.7 months in September and down from the 3.9-month figure recorded in October 2019.
To access October 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