Home prices in Miami Beach and the barrier islands continue to increase, according to Douglas Elliman’s fourth quarter reports, released Thursday.
Median sales prices per square foot rose by nearly 14 percent to $651 per square foot during the fourth quarter. Average sales prices of condos, in particular, jumped by 19 percent, with average prices per square foot up 17.8 percent.
“There was a greater surge in Miami Beach compared to the mainland,” Jonathan Miller, who authored the reports, told The Real Deal.
Miller, president of Miller Samuel Real Estate Appraisers & Consultants, said that all major markets in the United States are experiencing increased inventory. He said that as prices rise, more people put their homes on the market. Total inventory skyrocketed in Miami Beach by 20 percent during the year, to nearly 4,000 listings.
While inventory and prices rose in Miami Beach, the number of closed sales actually declined by 8 percent year-over-year. But that represents just nine fewer properties, according to the report.
The absorption period increased to 11 months in the fourth quarter, from eight in the fourth quarter of 2013. On the mainland, the absorption period increased slightly to nearly seven months.
“In 2015, you’re going to see a continued increased in inventory and a fairly brisk pace of sales,” Miller said. “Prices will continue to increase and there will be a continued decline of distressed real estate on the market.”
In Miami Beach’s luxury market, which Douglas Elliman defines as the top 10 percent of sales, condo sales prices increased a whopping 65 percent from 2013, with 10 percent less closed sales in 2014 than in the previous year. The average sales price rose by $1 million during the quarter, to $3.8 million.
“We’re coming off of very low lows, so the increase gets exaggerated, but it’s clearly rising,” Miller said.