While demand may still be brisk for middle-market homes, Miami-Dade County’s condo market is grappling with a severe drop in sales velocity.
A new report from the Miami Association of Realtors shows condo sales fell by nearly a fifth when comparing this year’s third quarter to the same time period in 2015, as the market contends with a swelling backup of inventory.
The report states 3,318 condos were sold in the third quarter, dropping 19 percent from the 4,404 that were sold in the same period of last year.
Inventory, meanwhile, has continued to pile up over the past 12 months. Miami-Dade had a whopping 14,107 active condo listings in the third quarter, marking an increase of 20 percent year-over-year. That’s not including the new development market, though roughly 77 percent of units in the pipeline have been presold, according to a recent report from brokerage ISG.
Even with the slowing sales and a growing backlog of listings, condo prices continue to rise. The median cost of buying a unit spiked 8.9 percent in the third quarter to $217,000.
While they’re faring better than condos, Miami-Dade’s single-family home market also saw a 6.8 drop in sales year-over-year, from 3,685 homes to 3,433 in the third quarter. In spite of that slower sales pace, the median price for a house rose 9.8 percent to $300,000, and the median time to enter a contract fell 10 percent to 45 days.
As market analyst Jonathan Miller previously told The Real Deal, those ballooning prices could be caused by Miami’s depletion of distressed properties, which typically trade at a discount. The association’s report said short-sales and lender-owned properties made up 15.7 percent of the county’s home sales in the third quarter, a rate that’s dropped 25 percent year-over-year.
If anything, condos are also selling faster than last year. The median time for listings to enter contract with a buyer fell 4 percent year-over-year to 72 days.