Miami Housing Market, Like Miami Heat, Are Enjoying a Winning Streak

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Based on a new Miami Market Report released this week by Douglas Elliman Florida, South Florida's largest housing market enjoyed a significant increase in sales in the first quarter of 2011.

According to a recent on-air CNBC interview, Starwood Capital CEO Barry Sternlicht stated, "The Miami housing market is on fire; driven mainly from foreign buyers of which over half are coming from Brazil. They are enjoying the benefits of Brazil's emerging economy and their currency's (the 'real') exchange rate against the U.S. dollar, which allows them to buy U.S. properties at significant discounts".

Barbara Lamar of Miami-based One Sotheby's International Realty said, "Sales are brisk in Miami due to a number of factors. Compared to other large cities worldwide such as Paris, Hong Kong, London and New York, Miami prices are a great value. A 3000 sq ft flat in Hong Kong or even London and New York could cost between $8 - $20 million. Here in South Beach you can pick one up for $ 3-4 million. There is also a strong international lifestyle draw because of major events like Art Basel, which has a large international following."


Douglas Elliman Florida Miami Market Report Highlights Include:

• Highest level of sales in more than 5 years.
• Distressed sales increased 18.2% over the year.
• Cash purchases accounted for nearly two thirds of all sales.
• Overall price indicators continue to slide.
• Non-distressed prices and sales remained stable.
• Overall average sales price was $260,918, 14% below prior year quarter.
• Non-distressed average sales price was $476,172, 0.4% above same period last year.
• Overall number of sales increased 25.9% to 5,101 from prior year quarter.
• Non-distressed number of sales slipped 1.5% from same period last year.
• Days on market (from date of last price change) was 66 days, one week faster than prior year quarter.
• Listing Discount (from last price change) was 8.3% from 11.6% in prior year quarter.

Douglas Elliman Florida's report further stated there were 25.9% more condo, townhouse and single family sales in 1Q 11 than in the same period last year. Distressed sales, namely short sales and REO, increased 18.2% over the same period. Cash purchases accounted for 65.5% of all sales in the first quarter, a 12% increase over last year.

The overall average sales price fell 14% to $260,918 a 5-year low as the rise in the distressed sale market share skewed price indicators lower. Non distressed sales increased a nominal 0.4% to $476,172, from $474,241 in the same period last year.

The difference between list price at time of contract and sales price was 8.3%, down from 11.6% in the same period last year.

There were 5,101 condo, townhouse and single family sales in the first quarter, 29.5% more than the same period last year. Sales activity remained above any prior quarter in the past 5 years. The increase in activity is due to a consistent absorption of distressed sales. The number of short sales expanded 10% over the past year and comprised 20.5% of all sales. REO sales nearly doubled over the same period representing 44.2% of the first quarter market. Distressed sales accounted for 64.7% of all sales in the first quarter, a 10% gain in market share over the past year. As a result of the rise in distressed sales activity, overall price indicators showed declines from the same period last year. However non-distressed sales showed a 0.4% increase to $476,172, from $474,241 in the same period last year. The first quarter 2011 average sales price of a short sale was $180,247 and an REO averaged $126,409. The average days on market--the number of days between the last list price change and the contract date--was one week faster than last year at this time, averaging 66 days. Active listing inventory, excluding unsold new development units, totaled 12,366 in the first quarter resulting in a 7.3 month absorption rate.
 


Single Family Market

The median sales price of a single family house declined 10.3% to $175,000. All five quintiles showed consistent declines from the prior year quarter.

There were 1,783 sales in the first quarter, 15.3% more than the prior year quarter. The market share for single family distressed sales increased 8.4% to 64.5% of all single family sales.



Condo and Townhouse Market

Condo and townhouse sales jumped 32.3% to 3,318 sales in the first quarter, representing 65% of total residential sales. Distressed sales reflected 64.8% of all condo/townhouse sales, 11% more than the prior year quarter.

The median sales price of a condo/townhouse was $119,000 in the first quarter, 20.7% below the prior year quarter as lower priced REO sales nearly doubled.
 


Luxury Market

The luxury market began at $535,000 in the first quarter. Median sales price declined 6.8% to $885,000 from the prior year quarter.

The average marketing time from the last time the list price was changed, if ever, to the contract date was 54 days, 12 days faster than the 66 day average in the overall market.

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