In the next couple of days we’ll discuss some of the
numbers that accurately describe the current situation of the Residential
Luxury Market here in Miami. South Florida’s residential real estate market for
single-family houses, condos and townhouses priced at a minimum of $1 million —
the basic criterion for luxury — has been in a growth phase since bottoming out
in 2009 after the U.S. financial crash, according to the data.
Industry experts say that the standard for a Healthy
residential real estate market typically have about six months of inventory
available. At the current 2013 sales
pace of about 235 luxury properties transacting monthly, South Florida now has
about 20 months of high-end inventory available on the market at a median price
of more than $540 per square foot, according to an analysis of Southeast
Florida MLXchange data.
Expert’s concerns are rising that South Florida’s
recovering luxury residential real estate sector may be losing momentum as an
increasing amount of inventory — a combination of resales and new construction
— comes onto the market at higher and higher prices in Miami-Dade. As more
luxury residences are placed on the South Florida market, buyers are expected
to inevitably pit sellers of high-end properties against one another in order
to negotiate better terms — and ultimately slow the recovery.
Since slumping to a median price of less than $410 per
square foot in 2009, prices for luxury residences in South Florida have
increased to nearly $420 per square foot in 2010, more than $440 per square
foot in 2011, and nearly $480 per square foot in 2012, according to the data.
Prior to the South Florida real estate crash in 2007, the
median resale price for a luxury residence in South Florida was less than $450
per square foot in 2006. The pre-crash price has not been adjusted for
inflation.
Despite the increasing median price per square foot for
luxury residential transactions in South Florida, resale transaction activity
for single-family houses, condos and townhouses has steadily increased on a
year-over-year basis since 2009 when an average of about 136 high-end
properties traded monthly.
Since 2009 in South Florida, buyers purchased an average
of nearly 160 luxury properties monthly in 2010, more than 185 residences
monthly in 2011, and nearly 240 properties monthly in 2012.
In the first quarter of 2013, the number of luxury resale
transactions occurring monthly slipped slightly while the median price for
high-end residences was unchanged in South Florida compared to 2012.
The results from a single quarter do not make a trend but
the statistics are noteworthy given that the peak of the South Florida winter
tourism season is usually about the month of February when the region is overwhelmed
with wealthy visitors. *Notes taken from a Special report by Peter Zalewski
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