South Florida Ends Record Home Price Streak
August marked the end of South Florida’s record-breaking streak of monthly home prices, but prices still remain significantly higher than a year ago. According to the Miami Association of Realtors’ monthly housing report released Thursday, Miami-Dade County recorded a median sales price of $620,000 for single-family homes and $416,000 for condominiums. This slight dip in monthly sales prices is the first in almost a year. Since December 2022, house prices have increased from a median of $530,900, while condos have seen a similar trend since March when the midpoint price was $400,000.
In Broward County, single-family house prices remained at July’s median of $600,000, while condo prices dropped to $275,000 from $280,000 over the past two months. Although this fluctuation may provide some relief to prospective homeowners, the median annual price still highlights the unaffordability of the South Florida housing market for many middle-class residents. Since August 2022, Miami-Dade house prices have risen by nearly 13%, with condo prices increasing by 11%. In Broward, house prices have risen by 7% and condo prices by 4% over the past year.
Jonathan Miller, CEO of Miller Samuel real estate consultancy, commented, “This shows the market taking a breath. That’s certainly helpful to buyers, but it doesn’t mean prices will correct year over year. The next couple of months will determine if this is an outlier or the beginning of a pattern.”
Despite the slight decline in prices, median home prices still remain significantly higher than a year ago. Real estate experts attribute this to buyers with strong financial capabilities willing to pay more for the desired homes. Additionally, South Florida continues to attract affluent newcomers from across the country.
Regarding local buyers, Ileana Abella, a real estate agent with Compass and chair of the residential real estate network Miami Master Brokers Forum, commented, “Locals just think our market is inflated. They will be more aggressive in negotiations and counteroffers.”
Total annual home sales experienced a decline in August. Miami-Dade saw 2,178 deals, a 13% drop compared to August 2022, while Broward experienced a decrease of 11% with 2,410 transactions.
Home sales in South Florida experienced a significant decline in August. Miami-Dade recorded 2,178 transactions, marking a 13% drop from the previous year’s 2,505 deals. Similarly, Broward witnessed a decrease of 11% with 2,410 transactions, compared to the previous year’s 2,700.
Cash continues to dominate the local real estate market, accounting for a substantial portion of home sales. In Broward, 38% of transactions were cash purchases, while in Miami-Dade, it was slightly higher at 40%. These figures are nearly double the national average of 27% cash homebuyers.
Although there was a slight improvement in the supply of homes for sale in South Florida in August, inventory remains significantly lower than the six to nine months required for a balanced housing market. Miami-Dade had 3.5 months of single-family houses available, along with 5.4 months of condos. In Broward, the inventory consisted of 2.8 months of houses and 3.8 months of condos. Increasing the inventory in the upcoming months is crucial to mitigate further price surges, as experts predict another interest rate hike before a decline in 2024.
Despite the recent decision by the Federal Reserve to refrain from additional interest rate hikes, the current rates remain at a 20-year high, significantly impacting borrowing costs for prospective buyers.