If you're braving Miami-Dade County's competitive housing market in search of a moderately-priced home or condo, it's no longer enough to be armed with a pre-approved mortgage loan or be flexible about location.
Today, there's one more essential thing to have: A fast trigger finger.
"So many people are looking for properties in the $180,000-$225,000 price point, buyers can no longer afford to say, 'Let me think about it and get back to you,'" said Justine Jimenez Garcia, owner and broker at Countywide Properties Inc. "This has been going on for a while now, but it's only getting worse."
For example, Garcia said the demand for a condo she listed two weeks ago at 13541 SW 64th Lane in Kendale Lakes was so high, the seller immediately received five offers — including one for more than the asking price of $269,000. The property is currently under contract.
While developers focus on Brickell and Wynwood and tourists frolic in Miami Beach and the Design District, a growing number of locals are flocking to stalwart suburban neighborhoods to snatch up the remnants of a dwindling supply of reasonably priced homes.
According to a new report by the Miami Association of Realtors, buyers priced out of hipper, centrally located neighborhoods are snapping up the existing single-family homes and condominiums in areas such as Kendall, Westchester and Miami Gardens. The report is based on sales recorded on the Multiple Listing Service from January through March 2018.
Experts say the national shortage of single-family homes and condos in the $200,000-$300,000 range is even tighter in Miami-Dade County. The culprits: investors who bought cheap after the 2008 recession and have held onto the properties to use them as rentals; competition from foreign buyers who pay in cash, and a dearth of construction of new, mid-priced housing options.
'A confluence of factors'
"We've got a confluence of factors that are straining the system in those affordable, middle-class markets," said Mike Pappas, president and CEO of The Keyes Company. "In the first quarter of 2015, there were 11,464 homes on the market priced under $300,000. Today, there are 5,143. That's less than half.
"It's a very tight and intense market. And this isn't the Rust Belt, where people are leaving. More and more people are coming to Miami, and we've got limited land and supply. It's a conundrum."
The real estate industry uses months of supply as a way to gauge the health of a particular market. A six-month supply — meaning the number of condos or homes listed for sale would take six months to sell off — is considered to be ideal.
The Realtors' report showed that the supply of condos available for sale in the first quarter of 2018 was tightest in The Crossings (2.3 months), Sunset (2.5 months) and Three Lakes (2.7 months), all near Kendall; and in Tamiami (1.7 months) and University Park (3.3 months), both near Westchester. One factor exacerbating the shortage is that these neighborhoods don't have as many condos as denser areas such as Brickell or Sunny Isles Beach, where prices are much higher.
For single-family homes, the supply is scarcest in Westview (1.6 months), Miami Gardens (2.3 months), Virginia Gardens (2.4 months), Hialeah Gardens (2.4 months) and Palmetto Estates (2.6 months).
Price drives demand
The scant supply in these neighborhoods is driven by price, which is often lower than the Miami-Dade median of $337,000. The median sales price of a condo in The Crossings, for example, was $222,000. The median sales price of a home in Miami Gardens was $232,950.
Monthly supply of condos and single-family homes was higher in pricier neighborhoods. The median single-family home price in Sunny Isles Beach was $800,000. That city has 45 months supply of inventory.
The median sales price of a condo in Aventura was $302,000. That city has 21.4 months of supply.
According to the report, the median price for single-family homes in Miami-Dade County grew to $337,000 in the first quarter — a 5.9 percent jump over the same period last year.
The median price for existing condominiums hit $230,000 — a 4.5 percent increase.
But despite the rise in prices, the total number of sales of existing homes and condos in Miami-Dade went down 6.5 percent, from 6,169 to 5,770. Sales volume dipped to $2.6 billion, down from $2.7 billion year over year.
"When prices go up as sales go down, that's reflective of one thing: Less inventory," said George Jalil, managing broker and president of Real Service First Living Realty and 2018 chairman of the Miami Association of Realtors. "The lower the inventory, the quicker your home sells. And when the number of buyers is bigger than the number of available homes, you end up with an inventory shortage."
According to the Miami Realtors report, single-family luxury home sales jumped 16.2 percent year over year in the first quarter of 2018. Luxury condo sales increased 8.4 percent.
The time single-family home listings went to contract went down from 58 to 48 days — a 17.2 percent decrease from the previous year. Condos also went to contract a little quicker, from 83 to 80 days, a 3.6 percent decrease.
There is certainly no shortage in the luxury condo market: According to EWM Realty International, price reductions in the luxury ($1 million and above) condo market spurred a 47 percent increase in sales from December 2017 to February 2018 over the same period a year ealier. But the overall supply of inventory is still at 41 months — more than three times the preferred 12 months of inventory for the luxury market.
Cash sales represented 40.8 percent of all closed sales in Miami-Dade, double the national figure of 20 percent. Roughly 54 percent of condo sales and 27 percent of single-family transactions were done in cash.