By Kevin Chiu
Propelled by lower home prices and record low mortgage rates home sales climbed 21% in the third quarter of the year in Miami, indicating that the market is finally in a rebound from its long downturn, according to the Miami Association of Realtors. The increase marks nine straight quarters of rising sales for the Sunshine State’s largest metropolitan area, which has suffered through one of the nation’s worst real estate collapses.
Condominium sales surged 43% over a year ago to bolster the market, while existing home sales declined a minimal one percent during the period. The Miami market has seen a surge of foreign buyers purchase condos at some of the lowest prices in more than a decade.
Florida has been financially slammed by the foreclosure crisis and now ranks second highest in foreclosures behind Nevada in the nation, according to RealtyTrac, which tracks foreclosures on a monthly basis. Residents of Florida are wondering whether the state is embarking on a real estate crash similar to that of the 1920’s when Southern Florida, where virtually the majority of residents lived at the time, sustained the worst real estate crash for any major metropolitan area in the nation’s history prior to the Great Depression.
The chairman of the Miami Board of Realtors does not believe that’s the case. “These figures reflect the stabilization of the single-family home market in South Florida and the overall demand that exists for local properties,” said Jack Levine of the Miami association. “Local sales are now at near normal levels, and we expect the local market to continue to strengthen.”
Another encouraging sign for the market is a seven percent decline in homes and condos listed for sale from a year ago with four percent of that drop in the last quarter alone. “Inventory levels are again declining while there continues to be strong demand from international and U.S. buyers,” said Miami Realtors Association President Oliver Ruiz. “Once the excess of the distressed properties is eliminated from the market, condominium median sales prices especially should begin to experience appreciation.”
Across Florida, sales of single family homes decreased seven percent and condo sales rose 15% during the quarter. Prices on homes and condos in Florida are still declining even as sales rebound. Median sales prices dropped 7% on homes to $135,200 and 21% to $84,000 on condominiums, according to the state association of Realtors.