MIAMI — Miami-Dade County continued its robust streak of surging total home sales in 1Q 2021 as pent-up demand, record-low mortgage rates and Miami’s allure as a world-class, global city have combined to lift the 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 surged 39.8% year-over-year, from 6,042 to 8,447. Miami single-family home transactions rose 25.8%, from 2,871 to 3,611. Miami single-family homes have now posted year-over-year sales gains in seven of the last eight quarters, a span of two years. Miami existing condo sales increased 52.5%, from 3,171 to 4,836.
“Miami’s 1Q 2021 sales would have been significantly higher had there been more inventory, particularly in single-family homes,” MIAMI Chairman of the Board Jennifer Wollmann said. “The demand for Miami real estate is at near all-time highs as more Northeastern and West Coast homebuyers and tech and finance companies relocate here. A large population group, the millennials, have moved into their prime home-buying years. We are also seeing more international buyers, particularly from Mexico and Spain.”
Lack of inventory in certain price points is impacting sales, particularly for single-family homes. Increased housing starts and more sellers listing properties in 2021 should help alleviate the lack of supply.
Miami Luxury Sales Jump 182.9% as Northeast and West Coast Buyers Move to Mega Region
Miami-Dade County single-family home luxury ($1-million-and-up) transactions surged 182.9% year-over-year to 679 transactions in 1Q 2021. Miami-Dade County condo luxury sales increased 188% to 553 transactions in 1Q 2021.
Record-low interest rates; a record-high S&P 500; the appeal of stable assets in a volatile economy; homebuyers leaving tax-burdened Northeastern and West Coast 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.
Miami Homeowners’ Home Equity Continues Surging as Many Pay Lower Mortgage Payments
With interest rates still at record lows, many South Florida homeowners have refinanced their home loans. So not only are many homeowners paying lower mortgage payments today; they are doing so while their wealth (home equity) has significantly increased. Home equity can be tapped for renovations, college loans and more.
Miami single-family home median prices rose 25.3% year-over-year, from $375,000 to $470,000. Median prices have now increased for 37 consecutive quarters, a streak spanning 9.25 years. Miami existing condo median prices rose 15.1% year-over-year, from $257,975 to $297,000.
Rising median prices is a trend nationwide as record-low mortgages rates and the increased availability of remote work and education has accelerated the demand for housing. Low inventory relative to high demand leads to prices rising.
Should mortgage rates resume their upward climb, home price growth is likely to slow in response. Also, as more sellers list properties in 2021, the increased inventory should ease the growth of median prices.
Miami remains a bargain compared to other global cities. In Miami, $1 million can net homebuyers 85 square meters of prime property, according to Knight Frank’s 2021 The Wealth Report. Monaco (15 square meters), Hong Kong (23), London (31), New York (34) and Geneva (35) and others offer significantly less prime land for $1 million.
Miami Dollar Volume Totals $6.4 Billion, Showcasing Impact Housing Plays in Local Economy
While other industries struggled over the past year, housing lifted the economy nationally and locally. For every two homes sold in the U.S., one job is created. Miami dollar volume showcases the impact housing plays in the local economy.
Miami single-family home dollar volume rose 122.6%, from $1.6 billion to $3.5 billion. Miami existing condo dollar volume increased 117.8% to $2.9 billion. The sales do not include Miami’s multi-billion-dollar new construction condo market.
Non-distressed sales comprised about 98.5% of all closed residential sales in 1Q 2021 vs. 94.5% in 1Q 2020. Only 1.5% of all closed residential sales in Miami were distressed in 1Q 2021, including REO (bank-owned properties) and short sales, compared to 5.5% in 1Q 2020. In 2009, distressed sales comprised nearly 70 percent of Miami sales.
Short sales and REOs accounted for 0.5% and 0.9%, respectively, of total Miami sales in 1Q 2021. Short sale transactions decreased 39.1% year-over-year while REOs fell 68.5%.
Lower mortgage rates made home purchases more affordable in 2021. According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 2.88% for 1Q 2021, down from the 3.51% average recorded during the same quarter a year earlier.
Miami Hot Markets: South Miami-Dade Cities Top List as Buyers Look to the Suburbs
Months’ supply of inventory is a strong indicator of real estate activity. A look at Miami-Dade County neighborhoods with the lowest months of supply of inventory (at least 100 new pending sales) in 1Q 2021:
- Cutler Bay, a south Miami-Dade town south of Palmetto Bay, had 1 months supply.
- The Hammocks, a community in south Miami-Dade east of The Crossings, had 1 months supply.
- Homestead, a south Miami-Dade city, had 1.1 months supply.
- Miami Gardens, a north Miami-Dade city along the Broward line, had 1.1 months supply
- Palmetto Bay, a village in south Miami-Dade north of Cutler Bay, had 1.4 months supply.
- The Hammocks, a community in south Miami-Dade east of The Crossings, had 1.4 months supply
- Homestead, a south Miami-Dade city, had 1.5 months supply
- Kendale Lakes, a south Miami-Dade community west of South Miami, had 1.5 months supply.
- Fountainebleau, a community in south Miami-Dade north of Westchester, had 2.1 months supply
- Kendall, a community in south Miami-Dade west of Pinecrest, had 2.9 months supply
Robust Demand for Housing Statewide, Nationally Fueling Double-Digit Increase in Sales
Closed sales of single-family homes statewide totaled 78,353 in 1Q 2021, up 19.4% from the 1Q 2020 level. In Florida’s condo-townhouse market, statewide closed sales totaled 37,505 during 1Q 2021, up 37% compared to 1Q 2020, according to data from Florida Realtors Research department in partnership with local Realtor boards/associations. Closed sales typically occur 30 to 90 days after sales contracts are written.
The statewide median sales price for single-family existing homes in 1Q 2021 was $317,500, up 17.6% from the same time a year ago. The statewide median price for condo-townhouse properties during the quarter was $235,422, up 14.8% over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.
Nationally, the median existing-home sales price rose 16.2% on a year-over-year basis to $319,200, a record high since 1989. All regions recorded double-digit year-over-year price growth, with the Northeast seeing a 22.1% increase, followed by the West (18.0%), South (15.0%) and Midwest (14.4%).
Homebuyers Targeting Miami Existing Condos: Four Times More Inventory than Single-Family
At the current sales pace, the number of active listings represents 2.4 months of inventory for single-family homes (seller’s market) and 8.7 for condominiums (balanced). A balanced market between buyers and sellers offers between six and nine months of supply inventory.
Miami real estate had 13,456 active listings in 1Q 2021, a 36.1% drop from the 21,052 listings at the same time last year. The inventory for single-family homes dropped 55.2%, from 6,216 to 2,784. Miami existing condo inventory decreased 28.1%, from 14,836 to 10,672.
Miami Real Estate Attracting Multiple Bids, Buyers Going Over-List Price
With low inventory, particularly for single-family homes, Miami properties are attracting multiple bids and buyers going over-list price. The median percent of original list price received was 97.1% for single-family homes and 94.4% for condos in 1Q 2021.
The median time to contract for single-family home listings was 30 days, a 46.4% drop from 56 days in 1Q 2020. The median time to contract for existing condos was 67 days, a 20.2% drop from 84 days in 1Q 2020.
The median time to sale for single-family homes decreased 20%, from 100 days to 80. The median time to sale for existing condos decreased 12.7%, from 126 to 110.
Miami Cash Sales Nearly Double National Figure: Miami Top Market for Global Buyers
Cash sales represented 35.3% of Miami closed sales in 1Q 2021, compared to 34.3% in 1Q 2020. About 20 percent of U.S. home sales 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 as well as some moving from more expensive U.S. markets who are able to buy more with their profits from real estate sales.
Cash sales accounted for 45.7% of all Miami existing condo sales and 21.4% of single-family transactions.
1Q 2021 Miami-Dade Statistical Reports — visit 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 101 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