Home sales on a tear as S. Florida bounces back

May 20, 2013 11:00AM

South Florida’s housing market is on fire, with pent-up demand reducing inventories to their lowest levels since 2005, the Miami Herald reported.

Although mortgage rates are at historic lows, few traditional homebuyers can take advantage – cash-rich investors and foreigners often beat them to the punch.

“Because inventory is so low, it’s creating some kind of a frenzy,” Chuck Bonfilgio, president of the Greater Fort Lauderdale Realtors and broker owner of AAA Realty Group in Pembroke Pines told the Herald. “People are pricing their homes over what the market is….Buyers know inventory is low and are willing to pay over appraisal to get the deal done.”

Underwater mortgages are keeping inventories low. Even as home values soaring, four out of every 10 mortgaged homes in Miami-Dade and Broward counties are underwater, according to February CoreLogic data cited by the Herald.

Owing more than market value, homeowners would have to make up for the lack of equity by paying the difference between what they owe and the sales price.

Tens of thousands of condos and single-family homes are in the pipeline but won’t be ready for years. [Miami Herald]Emily Schmall