Foreign Buyers Still Driving Miami's Housing Market in 2014

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According to the Miami Association of Realtors, Miami's residential property market continued to experience rising sales and prices in the first quarter of 2014 due to the increased demand from both foreign and domestic buyers.

The Miami Association of Realtors reports that in the first quarter, the median sales price for homes in Miami-Dade County was $230,000, an increase of 11.8 percent compared to last year.  The median sales price for condominiums rose 15.7 percent to $187,500 in the first quarter compared to a year earlier. First quarter price increase marks nine (9) consecutive quarters of growth for both single-family homes and condominiums.

"Following three record sales years in Miami, it is remarkable that the local market continues to experience strong demand exceeding the previous year's results," said 2014 Chairman of the Board of the Miami Association of Realtors Liza Mendez.  "Despite the strong demand for Miami properties, increased inventory is creating a more balanced market between buyers and sellers."

Compared to last year, the average sales prices for single-family homes and condominiums increased 17.9 percent to $430,312 and 16.9 percent to $359,860, respectively.

Nationally, the median sales price of existing single-family homes was $196,900 in the first quarter, up 10.1 percent from the third quarter of 2012.  The national median sales price for condominiums was $191,400, a 10.8 percent increase over the previous year.

The statewide median sales price for single-family existing homes in the first quarter was $168,000, up 9.1 percent from the same quarter a year ago. The median sales price for condominiums in Florida was up 16.9 percent compared to the same quarter last year at $135,000.

Negligible Sales Decline for Condos

There were 6,752 homes and condos sold in Miami-Dade County during the first quarter of 2014, an increase of 3.8 percent compared to the first quarter of 2013.  Sales of single-family homes increased 7.4 percent to 2,893, while condominium sales increase 1.3 percent to 3,859 compared with the same period in 2013.

"Despite record demand for Miami properties, affordability remains a reality," said 2014 Miami Association of Realtors Residential President Francisco Angulo.  "The majority of homes sold in Miami-Dade County in the first quarter were below $200,000 and prices remain what they were in 2003, creating opportunities for all types of buyers."

Nationally, total existing-home sales, including single-family and condos, fell 6.9 percent to a seasonally adjusted annual rate of 4.60 million in the first quarter from 4.94 million in the fourth quarter of 2013, and were 6.6 percent below the 4.93 million pace during the first quarter of 2013, according to the National Association of Realtors.

Statewide closed sales of existing single-family homes totaled 50,251 in the first quarter, up 2.3 percent compared to the year-ago figure, according to the latest housing data release by Florida Realtors.  Closed sales of condominiums totaled 24,860, down 0.8 percent compared to 2013.

Home Inventory Moving Rapidly Despite More New Listings

The Miami Association's initiatives to increase inventory and focus on assisting members to get more listings has proven successful along with some additional distressed properties coming on the market.  The fact that sales remain at historically strong levels while inventory is growing points to seller confidence.  Sellers are listing properties for sale because they have confidence in the market.

Home and condominium listings also increased in the first quarter. There were 6,384 new single-family home listings during the first quarter, a growth of 11.5 percent relative to the same period last year. New condominium listings increased 14.9 percent from 8,123 in the first quarter of 2013 to 9,334 this year.

Fourth quarter active listings in Miami-Dade County totaled 16,879, representing an increase of 29.2 percent.  This reflects the success of the MIAMI campaign to achieve a more balanced market between buyers and sellers.  At the current sales pace, current inventory represents 5.6 months of inventory for single-family homes and 7.5 for condominiums.  Compared to the first quarter of 2013, months' supply of inventory for single-family homes and condominiums increased 9.5 percent and 27.6 percent respectively.  A balanced market between buyers and sellers offers between six and nine months' supply of inventory.

The median duration of a home listing during the last quarter was 47 days compared to 46 days during the same period last year, a slight increase of 2.2 percent. Similarly, the median days on the market for condominium listings were 57 days compared to 48 last year, an increase of 18.8 percent.

Percentage of Cash Sales Declines

In the first quarter, 62 percent of closed sales were all cash compared to 65 percent a year ago.  All cash sales were 48.4 percent of single-family home closings and 71.4 percent of all condominium sales.  Since nearly 90 percent of foreign buyers pay cash, this reflects Miami's position as a top market for foreign buyers.  Miami has a significant percentage of international buyers, generating many more cash transactions than the national average.