Just like its surging rental market, Miami’s high-end residential sector has been showing significant improvement in the first five months of 2011.
“What’s happened over the last 24 months is really kind of phenomenal,” EWM President Ron Shuffield told The Real Deal. “When you think about what a deep, dark hole we were in, now to see this real sold activity we’re having, we’re fortunate to be where we are.”
In the first five months of 2011, there has been an average of 51 condo sales over $1 million per month, and 41 home sales in the same price bracket, according to MLS data provided to The Real Deal by EWM.
“That projects to about 1104 sales for the year,” Shuffield said. “If we continue [at] that pace, we’ll have about a 22 percent increase in the units of sales this year.”
At the peak of the real estate boom, there were 1,498 sales in the over-$1 million market, and just 738 such sales in 2009. If this year’s numbers hold up, that would translate to a roughly 50 percent jump from the worst of the downturn in 2009.
The high-end market, especially condos, have been driven by the influence of foreign buyers. They’ve come largely from Latin America, looking for easy-to-maintain foreign homes. But it’s the highest niche of the high-end market that has been leading the charge.
At the $5 million price point, the numbers are even more positive, said Beth Butler, president of One Sotheby’s International Realty.
“What’s happened in the last 60 days is almost all of the high-end market sold,” Butler said. “We’re really looking at an inventory shortage. The deals that have been sitting on the market for a while are now selling, for good prices and multiple offers. So it’s very encouraging.”
Butler pointed to a pending apartment sale at Apogee for a unit which had been on the market for two years.
“It’s kind of startling, because it sold for a price [of $11.5 million] that I think, six months ago, we wouldn’t have thought would happen,” she said.
These types of condos have seen a significant uptick in activity of late, Shuffield said.
“[The Miami market] is selling more condos over $7.5 million than we’ve ever sold in the past,” he said. “Over the last nine years, we’ve been averaging 2.5 sales a year. In the past 12 months, we sold eight.
The sales included one at South Beach’s Continuum for $10 million, the Apogee sale, a condo on Fisher Island that sold for $8.15 million, a unit at the Gables Club in Coral Gables that traded for $9 million, a $15 million penthouse at the Setai, an $8.7 million sale at One Bal Harbour, a penthouse at Fontainebleau II for $9 million and the Santa Maria condo in Brickell, which saw an $11 million sale.
As for the impact of all these large sales on prices, it may take time, but some of the drivers are in place, Butler said.
“I think we’re going to see that prices are going to start going up a little,” she said. “Inventory’s decreasing [and] a price increase is soon to follow. I think that when we look at the six-month point at the end of this month, we’re going to see that the price per square foot at a lot of these buildings actually increased.”