The Real Deal Miami

Inventory moves reflect bottoming

By Roger Drouin | April 17, 2009 03:53PM

The inventory of homes and condos on the market in South Florida keeps shrinking, as more homes are sold and banks defer some foreclosures.

On Miami Beach — taking into account pending sales — the glut of condos for sale was down to a 20-month supply in March, cut in half from 15 months ago and down from a 30-month supply in February, according to statistics from the regional Multiple Listing Service, or MLS. 

Across Miami-Dade, Broward and Palm Beach counties, the supply of single-family homes also saw a drop in overall inventory, decreasing to 37,779 residences on the market on April 13, compared to 38,323 homes on April 6 and 39,233 available houses on March 30, according to a new report from Condo Vultures LLC.

Nearly 1,000 more residential properties in South Florida came off the market than went on in the last week.

“Since the week of Thanksgiving, the inventory in the tri-county area has gone down 14 percent,” said Peter Zalewski, a longtime realtor who started Bal Harbour based real estate consultancy Condo Vultures. Add pending sales into the mix, and the numbers are even more “eye catching.”

Realtor Marci Trautenberg cites three causes for inventory drops in the Miami Beach and Aventura markets. Cash buyers looking for second or third-homes are motivated to buy now by low sale prices. Also, banks are holding off on some foreclosures, keeping units in the hands of owners. Finally, potential sellers sense a turnaround and are waiting to sell, keeping the flow of new inventory down.

“We are taking it as a sign that we’ve been at the worst, that the market is coming back,’ said Trautenberg, a realtor with EWM Real Estate.

Cash investors remain king. They are sweeping up single-family homes, making repairs and renting them out. They are buying waterfront condos, sometimes in pairs.

When financing becomes more available for average homebuyers, the inventory will really start to move, Zalweski said. That might take a while, but that’s when the prices will start to rise.

Until that point, pricing will remain “very soft,” Zalweski said, because more than half of buyers are cash investors.

“You can get things for prices never dreamed of before,” said Isabel M. Gonzalez, a realtor with Keyes Real Estate. “The problem is financing. The banks are being very picky.” Gonzalez said 97 percent of her customers are buyers, and they are going for short sales and foreclosures.