Miami-Dade County has four years of luxury condo inventory – not including the glut of preconstruction condos being marketed for sale.
Nearly 2,800 units are on the market asking at least $1 million, according to a new report from Condo Vultures Realty. In 2017, 681 luxury units sold in the county, meaning an absorption rate of about 57 units a month.
Six months of supply generally makes for a balanced market. Anything over that suggests a buyer’s market, while years of excess supply suggest developers and sellers will be sitting on product for a long time.
That means that there are about three years of excess luxury condo inventory in Miami-Dade.
About 152 luxury condos are under contract for an average asking price of more than $3.3 million, or about 1,100 per square foot as of Tuesday. The average closing price in 2017 was less than $2.4 million, or about $910 per square foot, according to the report. That’s 28 percent lower than the current average asking price.
According to Condo Vultures, there are nearly 47,500 units in the development pipeline in South Florida since the new cycle began in 2011. That includes projects that have been proposed, planned, or are under construction or completed in Miami-Dade, Broward and Palm Beach counties east of I-95.
Developers, brokers and sellers in South Florida’s luxury condo sector have been forced to adjust their pricing, wait longer for units to sell and scour the globe for new buyers amid the luxury market slowdown. The condo market has slowed since the beginning of 2016, due in part to foreign economic and political turmoil and currency fluctuations.
A report from August found that the Bal Harbour, Surfside and Bay Harbor Islands market was facing two years of excess luxury condo inventory.