Houses are staying on the market longer in the Miami area than in most other big cities around the country, according to a report by the online real estate company Trulia.
The likely culprits? High prices and a glut of new inventory, said Trulia chief economist Ralph McLaughlin.
“Miami is in this weird stalemate situation where sellers probably don’t want to reduce the price of their units because they don’t want to lose money, but middle-class buyers aren’t able to afford them,” McLaughlin said. “So what we’ll see is homes sitting on the market longer until either sellers decide to lower their sales price or the economy continues to improve and buyers can start to afford them.”
About 65 percent of Miami-Dade County homes listed on Trulia’s website in February were still on the market two months later, the company found.
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Of the 100 largest housing markets the company analyzed, only nine cities had a greater percentage of homes on the market after two months. They included Albany, New York; Knoxville, Tennessee; Pittsburgh, Pennsylvania; and Birmingham, Alabama.
The analysis looked at both new sales and resales of single-family homes, condominiums and town houses.
Miami also saw one of the biggest year-over-year jumps in the percentage of homes staying on the market. In April 2014, 56 percent of homes listed on Trulia had been on the market for two months. Only Austin and Atlanta saw bigger annual increases.
An unusual combination of factors is producing a tough market for both buyers and sellers: Miami is one of the least affordable housing markets in the U.S. at a time when new development is happening across the county, which has about 18,000 new units under construction, according to a Census estimate.
“This combination of new supply and waning demand because of affordability would lead to a situation where homes stay on the market longer,” McLaughlin said.