It might not be the bloodbath seen when Miami-Dade County’s housing market crashed in 2008, but many in the real estate community are likely feeling the pressure.
Both condo and single-family home sales continued their downward slide in Miami-Dade during May, according to a newly released report from the Miami Association of Realtors, all while prices maintained their steady climb.
Single-family home sales decreased 7.2 percent last month, from 1,272 properties traded in May 2015 to 1,180 this year.
Condos were hit much harder. A total of 1,255 units sold in May, down 13.3 percent from the 1,447 units sold the same month a year ago.
Prices, however, seem to be going nowhere but up. The median sales price of a single-family home hit $295,000, a growth of $13,000 or 4.6 percent from May 2015. Condo prices also rose by 2.5 percent from $209,000 in May 2015 to $214,250 last month.
As previously pointed out by market analysts like Jonathan Miller, who authors Douglas Elliman’s quarterly residential market, pricing trends can lag behind sales by as much as 15 months.
Others are saying sellers might have to face reality sooner than that. Researcher Anthony Graziano of Integra Realty Resources said at a recent panel discussion that many homeowners are still listing their properties at “aspirational” prices, which means those homes end up staying on the market for longer.
That buildup of inventory is starting to show: May saw 14,107 active condos and townhomes on the market, a figure that’s surged 16.8 percent from the year before. All those units translate to 11.2 months of inventory, which is on the upper end of the six to 12 months that’s considered tolerable for a housing market.
For single-family homes, however, Miami is still a seller’s playground. There were 5,827 active listings during May, marking an increase of about 8.1 percent from May 2015. Though the amount of homes up for sale has grown significantly, Miami-Dade still has about 5.6 months of single-family inventory.
The reasons behind Miami’s residential slowdown haven’t changed: foreign currencies are still weak against the dollar, making Miami real estate a more expensive venture for foreign nationals. Buyers have cleaned out much of Miami’s distressed housing inventory, meaning fewer properties are up for grabs in the lower price brackets.
And although more than half of home sales in Miami-Dade are done with cash, the Federal Housing Administration had approved only 13 of the county’s 9,307 condo buildings for loans in May, which means it’s difficult for a condo buyer to obtain federal financing, according to the report.
Despite an overall slowdown, activity in certain price brackets is actually heading up. According to the association’s numbers, sales for single-family homes priced between $200,000 and $600,000 grew 5.9 percent year-over-year. With 756 sales, that bracket makes up 64 percent of all single-family homes traded in May.
Condos between $150,000 and $300,000 were also trading like hotcakes. A total of 540 condos in that range sold last month, representing 43 percent of all county condo sales, up 12 percent year-over-year.