MIAMI — Martin County single-family home luxury transactions rose in August 2021 as pent-up demand, more U.S. individuals and companies moving to South Florida, and record-low mortgage rates continue fueling transactions, according to the MIAMI Association of Realtors (MIAMI) and the Multiple Listing Service (MLS) system.
Martin single-family luxury ($1-million-and-up) transactions jumped 36.4% year-over-year to 30 sales in August 2021.
“Homebuyers love Stuart and Martin County’s small-town atmosphere and proximity to the ocean,” JTHS-MIAMI President Bill Mate said.
There are 2.6 months of supply in luxury single-family homes; 8.1 months of supply in luxury condos. Luxury months of supply continues to trend downward for all property types, month-over-month, and year-over-year.
Low interest rates; a robust 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.
Martin County Total Home Sales Decrease Due to Record-Low Inventory
Record-low inventory, rather than a decline in demand, slowed down sales in Martin County in August 2021.
Martin County total home sales decreased 6.7% year-over-year in August 2021, from 357 to 333. Martin single-family home sales decreased 8.5% year-over-year, from 248 to 227. Martin condo transactions decreased 2.8% year-over-year, from 109 to 106.
Also, the August 2021 statistics are in comparison to a robust second half of 2020. The second half of 2020 was one of the strongest second half for sales in a long time.
Lack of inventory in certain price points is impacting sales, particularly for single-family homes. More inventory is expected to come to the market as potential home sellers become more comfortable listing and showing their homes. The falling number of homeowners in mortgage forbearance will also bring about more inventory.
Martin County Inventory Continues to Decline, Slowing Down Sales
Inventory of Martin single-family homes decreased 46% year-over-year in August 2021 from 559 active listings last year to 302 last month. Condominium inventory decreased 57.5% year-over-year to 135 from 318 listings during the same period in 2020.
Months’ supply of inventory is down since July 2019 for single-family, reflecting strong demand. Months’ supply of inventory for single-family homes decreased 57.1% to 1.2 months, which indicates a seller’s market. Inventory for existing condominiums decreased 69.4% to 1.1 months, which indicates a seller’s market. A balanced market between buyers and sellers offers between six- and nine-months supply.
Total active listings at the end of August 2021 decreased 50.2% year-over-year, from 877 to 437.
Nationally, total housing inventory at the end of August totaled 1.29 million units, down 1.5% from July’s supply and down 13.4% from one year ago (1.49 million). Unsold inventory sits at a 2.6-month supply at the current sales pace, unchanged from July but down from 3.0 months in August 2020.
Martin 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.
Martin County single-family median prices increased 16.5% year-over-year in August 2021, increasing from $425,000 to $495,000. Existing condo median prices increased 14% year-over-year, from $181,000 to $206,300.
The greater share of Martin luxury sales in 2021 compared to a year ago is part of the reason for the large year-over-year increase in median prices.
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.
Lower mortgage rates are making home purchases more affordable. According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage was 2.84% in August, down from 2.87% in July. The average commitment rate across all of 2020 was 3.11%. NAR Chief Economist Lawrence Yun expects the 30-year fixed-rate mortgage to remain below 3.5% in 2021.
Should mortgage rates resume their upward climb, home price growth is likely to slow in response. As more sellers list properties in 2021, the increased inventory should ease the growth of median prices.
South Florida 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.
Martin Dollar Volume Totals $225 Million, 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.
Martin total dollar volume totaled $225 million in August 2021. Single-family home dollar volume increased 18.4% year-over-year, from $163.6 million to $193.6 million. Condo dollar volume increased 27.8% year-over-year, from $22.9 million to $29.3 million.
Martin Distressed Sales Keep Dropping, Reflecting Healthy Market
Only 1.2% of all closed residential sales in Martin were distressed last month, including REO (bank-owned properties) and short sales, compared to 0.6% in August 2020.
Total Martin distressed sales increased 100% year-over-year in August 2021, from 2 to 4. Short sales and REOs accounted for 0.6% and 0.6% year-over-year, respectively, of total Martin sales in August 2021. Short sale transactions increased 100% year-over-year while REOs stayed even.
Nationally, distressed sales represented less than 1% of sales in August 2021, equal to August 2020.
National, State Housing Demand Robust as More Inventory Expected to Arrive
Nationally, total existing-home sales transactions completed transactions that include single-family homes, townhomes, condominiums and co-ops, fell 2.0% from July to a seasonally adjusted annual rate of 5.88 million in August. Year-over-year, sales dropped 1.5% from a year ago (5.97 million in August 2020).
Statewide, closed sales of single-family homes in August totaled 29,550, up slightly (0.2%) year-over-year, while existing condo-townhouse sales totaled 12,550, up 13.1% over August 2020. Closed sales may occur from 30- to 90-plus days after sales contracts are written.
Nationally, the median existing-home price for all housing types in August was $356,700, up 14.9% from August 2020 ($310,400), as prices increased in each region. This marks 114 straight months of year-over-year gains.
The statewide median sales price for single-family existing homes in August was $354,000, up 18% 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 $252,500, up 16.1% over August 2020. The median is the midpoint; half the homes sold for more, half for less.
Martin Real Estate Attracting Multiple Bids, Buyers Going Over-List Price
The median percent of original list price received for single-family homes was 98.7% in August 2021, up 3.2% from 95.6% last year. The median percent of original list price received for existing condominiums was 100%, up 5.6% from 94.7% last year.
The median number of days between listing and contract dates for Martin single-family home sales was 12 days, a 67.6% decrease from 37 days last year. The median time to sale for single-family homes was 55 days, a 30.4% decrease from 79 days last year.
The median number of days between the listing date and contract date for condos was 7 days, down 88.1% from 59 days. The median number of days to sale for condos was 50 days, a 45.7% decrease from 92 days.
Martin Cash Sales More than Double National Figure in August 2021
Cash sales represented 55.6% of Martin closed sales in August 2021, compared to 36.9% in August 2020. About 22% of U.S. home sales are made in cash, according to the latest NAR statistics.
The high percentage of cash buyers reflects South Florida’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 can buy more with their profits from real estate sales.
Cash sales accounted for 67.9% of all Martin existing condo sales and 49.8% of single-family transactions.
To access August 2021 Martin 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 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