MIAMI — Broward County mid-market condominium sales rose for the second consecutive month as total active listings jumped for the third straight month in September 2022, according to the MIAMI Association of Realtors (MIAMI) and the Multiple Listing Service (MLS) system.
“Homebuyers looking for homes in the $400K to $600K range are zeroing in on Broward County as our condominium market at that price point is seeing a surge of new listings,” BROWARD-MIAMI President David Dweck said.
Broward Mid-Market Condo Sales Jump Again
Broward mid-market homes priced between $400,000 to $600,000 saw a 42.1% jump in sales year-over-year in September 2022 to 199 transactions. The jump corresponds to a 23.5% rise in new listings for that same price range.
As far total sales compared to a record September 2021, Broward County September 2022 transactions decreased 25.1% year-over-year, from 3,136 to 2,348, because of rising mortgage rates and low inventory.
Broward single-family home sales decreased 30.6%, from 1,489 to 1,033. Broward condo transactions declined 20.2%, from 1,647 to 1,315.
Fed, which voted for another Fed Funds rate increase in September, is intent on slowing 40-year high inflation. While the Fed doesn’t set mortgage rates, it affects them through its conduct of monetary policy. As a result, the 30-year fixed mortgage rate has fluctuated from 2.99% to 6.92% in the last 52 weeks, an unprecedented range of volatility.
September 2022 marks the seventh consecutive month of 5% or higher mortgage rates. According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage was 6.11% in September, up from 5.22% in August. The average commitment rate across all of 2021 was 2.96%.
South Florida’s Real Estate’s Strong Market Fundamentals Vs. High Rates, Low Inventory
– Global companies, such as the $54 billion-dollar hedge fund Citadel, continue relocating to South Florida, bringing high-paying jobs.
– Demand from homebuyers from high-tax, high-density states remain high as Florida driver license swaps are up double digits for relocating Californians and New Yorkers.
– Global buyers, who because of pandemic protocols haven’t been able to purchase as they are accustomed to in recent years, are returning in mass to the No. 1 destination for global homebuyers. This month, South Florida was ranked as the 1 destination in the world for foreign investment by Financial Times.
– Broward’s percentage of cash buyers (40.3%) is significantly higher than the national average (22%).
– Demographic shifts (Millennials reaching prime home-buying age and surging senior/retiree population growth)
– High percentage of workforce working remotely favors the South Florida market, where many have relocated to live, work and play because of our lifestyle, weather and more.
South Florida: A Bargain in Comparison to Other Global Cities & U.S. Metros
Miami-Fort Lauderdale-West Palm Beach’s price per square meter is $3,170, far below at least 30 global cities and 13+ U.S. Metros including markets such as Hong Kong ($28,570), New York City ($17,191), San Francisco-Oakland-Hayward, CA ($8,250), Madrid, Spain ($6,173), Los Angeles-Long Beach-Glendale, CA ($4,740) and Seattle-Tacoma-Bellevue, WA ($4,460), according to National Association of REALTORS Profile of International Transactions in U.S. Residential Real Estate 2022.
Broward County single-family home median prices increased 13.1% year-over-year in September 2022, increasing from $499,450 to $565,000. Existing condo median prices increased 24.4% year-over-year, from $213,000 to $265,000.
While median prices have increased nationally so has house-buying power because of a long-run decline in rates before March 2022 and the slow, but steady growth of household income. West Palm Beach (No. 5) and Miami (No. 6) ranked among the Top-10 U.S. metros where homebuyer income grew the most during the pandemic via Aug. 2022 Redfin report.
Home prices are determined by supply and demand. Lower supply and higher demand create higher prices. Inventory for Broward single-family homes (2.7 months) and condos (2.2 months) are low. Also, one of the supports for home prices is rents and rents are rising strongly.
Locally, the greater share of South Florida luxury sales is also part of the reason for the large year-over-year increase in median prices.
Broward Total Inventory Rises for Third Consecutive Month
Inventory of single-family homes increased 52% year-over-year in September 2022 from 2,323 active listings last year to 3,531 last month. Condominium inventory decreased 2.4% year-over-year to 3,624 from 3,712 listings during the same period in 2021.
New listings of Broward single-family homes decreased 9.2% to 1,497 from 1,649. New listings of condominiums decreased 16.6%, from 1,921 to 1,602.
Months’ supply of inventory for single-family homes increased 80% to 2.7 months year-over-year, which indicates a seller’s market. Inventory for existing condominiums increased 10% to 2.2 months, which also indicates a seller’s market. A balanced market between buyers and sellers offers between six- and nine-months supply.
Total active listings at the end of September 2022 increased 18.6% year-over-year, from 6,035 to 7,155.
Nationally, total housing inventory at the end of September was 1.25 million units, which was down 2.3% from August and 0.8% from the previous year. Unsold inventory sits at a 3.2-month supply at the current sales pace – unchanged from August and up from 2.4 months in September 2021.
Miami Real Estate Posts $264 Million Local Economic Impact in September 2022
Every time a home is sold it impacts the economy: income generated from real estate industries (commissions, fees and moving expenses), expenditures related to home purchase (furniture and remodeling expenses), multiplier of housing related expenditures (income earned as a result of a home sale is re-circulated into the economy) and new construction (additional home sales induce added home production).
The total economic impact of a typical Florida home sale is $112,500, according to NAR. Broward County sold 2,348 homes in September 2022 and had a local economic impact of $264 million.
Broward total dollar volume totaled $1.2 billion in September 2022. Single-family home dollar volume decreased 24.15% year-over-year, from $991 million to $751 million. Condo dollar volume increased 1.5% year-over-year, from $466 million to $473 million.
Broward Distressed Sales Remain Low, Reflecting Healthy Market
Total Broward distressed sales decreased 41.4% in September 2022, from 29 to 17. Short sales and REOs accounted for 0.1% and 0.6% year-over-year, respectively, of total Broward sales in September 2022. Short sale transactions decreased 85.7% year-over-year while REOs stayed even.
Only 0.7% of all closed residential sales in Broward were distressed last month, including REO (bank-owned properties) and short sales, compared to 0.9% in September 2021.
Broward’s percentage of distressed sales are on par with the national figure. Nationally, distressed sales represented approximately 2% of sales in September, a marginal increase from 1% in September 2021.
Broward’s Percentage of Sales Continue to Outpace the Nation, State
In Florida, closed sales of single-family homes statewide totaled 20,099 in September 2022, down 29% year-over-year, while existing condo-townhouse sales totaled 8,406, down 29%. Closed sales may occur from 30- to 90-plus days after sales contracts are written.
Nationally, total existing-home sales transactions retracted 1.5% from August to a seasonally adjusted annual rate of 4.71 million in September. Year-over-year, sales waned by 23.8% (down from 6.18 million in September 2021).
The statewide median sales price for single-family existing homes was $403,880, up 13.8% from the previous year, according to data from Florida Realtors Research Department in partnership with local Realtor boards/associations. Last month’s statewide median price for condo-townhouse units was $307,250, up 20.5% over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.
Nationally, the median existing-home price for all housing types in September was $384,800, an 8.4% jump from September 2021 ($355,100), as prices climbed in all regions. This marks 127 consecutive months of year-over-year increases, the longest-running streak on record.
Broward Real Estate Attracting Multiple Bids, Buyers Going Over-List Price
The median percent of original list price received for single-family homes was 96.9% in September 2022, down 3.1% from 100% last year. The median percent of original list price received for existing condominiums was 98%, up 0.2% from 97.8% last year.
The median number of days between listing and contract dates for Broward single-family home sales was 22 days, up from 13 days last year. The median time to sale for single-family homes was 61 days, an 8.9% increase from 56 days last year.
The median number of days between the listing date and contract date for condos was 18 days, down 6.3% from 19 days. The median number of days to sale for condos was 58 days, a 9.4% decrease from 64 days.
Broward Cash Sales 83.2% More than National Figure in September 2022
Cash sales represented 40.3% of Broward closed sales in September 2022, compared to 38.9% in September 2021. About 22% of U.S. home sales are made in cash, according to the latest NAR statistics.
Cash buyers are not deterred by rising rates. The high percentage of cash buyers reflects South Florida’s top position as the preeminent American real estate market for foreign buyers, who tend to purchase with all cash as well as some moving from more expensive U.S. markets who can buy more with their profits from real estate sales.
Cash sales accounted for 52.2% of all Broward existing condo sales and 25% of single-family transactions.
Note: Statistics in this news release may vary depending on reporting dates. MIAMI reports exact statistics directly from its MLS system.
Source: MIAMI Association of Realtors®
