South Florida home prices surged by double digits in October, as buyers competed for a tight supply of houses and condominiums.
October results, however, signaled a potential shift in the housing market as Miami-Dade County registered the first slowdown in sales of single-family homes since June 2012 and the first dip in year-over-year condo sales since September 2012, according to the Miami Association of Realtors.
Sales of single-family homes in Miami-Dade fell 6.5 percent to 1,060 closings in October from 1,134 a year earlier and were off 4.3 percent from 1,108 closings in September 2013. Miami-Dade condo sales dipped 1.2 percent in October to 1,416 closings from 1,433 a year earlier, but were up 4.7 percent from 1,352 closings in September 2013.
Meanwhile, in Broward County, sales of single-family homes inched up 1.6 percent in October to 1,214 closings from 1,195 a year earlier, marking a slower pace of growth than earlier this year, according to the Greater Fort Lauderdale Realtors. Broward condo sales dipped 0.3 percent in October to 1,368 closings from 1,372 a year earlier.
Analysts attribute the slowing of sales to various factors, ranging from rising home prices and interest rates that sideline some prospective buyers, to the federal government shutdown and a simple lack of choices. In any case, the region’s home sales remained strong by historic standards and prices continued to march higher at a rapid clip.
In Miami-Dade, the median price of a single-family home jumped 18.9 percent in October to $220,000 from $185,000 a year earlier, while the median price for a condominium rose 17.2 percent to $170,000 from $145,000, according to the Miami Realtors.
In Broward, the median price of a single-family home rose 27.6 percent to $270,000 in October from $211,550 a year earlier, and that of a condominium jumped 29.2 percent year over year to $116,250 from $90,000, the Greater Fort Lauderdale Realtors said.
“It’s definitely a sellers’ market,” said Eli Montag, a sales associate with Coldwell Banker in Miami Beach. “A good home in good condition in a desirable neighborhood ... is going to get multiple offers.’’
While mortgage interest rates will eventually rise further, creating headwinds for the current housing boom, for now the market outlook remains positive, according to Anthony Askowitz, a broker owner at RE/MAX Advance Realty in Miami. “We’re expecting November and December to be very strong months just like October was strong for our office,” Askowitz said.
Underscoring strong demand amid tight supply, Broward single-family homes sold at a median pace of 30 days on the market, down from 40 days a year earlier. The median period condos were on the market dropped to 37 days in October from 43 last year, the Realtors group said.
In Miami-Dade, the median days on the market for a single-family home inched up to 40 in October from 38 a year earlier, still a brisk pace by historic standards, while the median pace for selling condos was 44 days compared with 43 a year earlier.
Sellers in Miami-Dade and Broward counties fetched closer to their asking prices in October compared with a year earlier. In Miami-Dade, single-family homes sold at an average of 96.3 percent of the original list price, up 1.4 percentage points from last year; condos commanded 97.5 percent of their original asking prices, up from 96.9 percent in October 2012. Single-family homes in Broward sold for an average of 95.8 percent of their original list prices in October, up 1.7 percent from a year earlier, while condos sold at 94.7 percent of their list prices, compared with 94.5 percent a year ago.
First-time homebuyers Martin Casal and his wife Yaisy recently signed a contract on a three-bedroom, two-bath house in Kendale Lakes for $290,000 — close to the asking price of $299,000. Casal, a sales manager for a local company, said the couple knew they couldn’t push for price cuts because of strong demand and tight inventory. “There is a lot of competition. The market has changed tremendously from a few years ago,” Casal said.
While still relatively tight, the inventory of Miami-Dade condos listed for sale expanded 23.5 percent in October to 9,322 units in October from 7,551 a year earlier. That amounted to a 6.5-month supply, compared with a 5.7-month supply a year earlier.
Analysts typically consider a supply of less than six months of homes listed for sale — that is, six times the number of homes sold — as a seller’s market, marked by rising prices.
The inventory of single-family homes for sale in Miami-Dade increased 10.4 percent to 5,571 units in October from 5,046 a year earlier, which was a 5.2-month supply compared with a 5.5-month supply last year.
The inventory of single-family homes in Broward listed for sale in the Multiple Listing Service inched up 2.7 percent to 4,829 from 4,700 in October 2012.
However, amid strong demand, the months of supply of single-family homes in Broward fell to 3.8 in October from 4.1 months a year earlier. The inventory of Broward condos increased 13.3 percent to 6,684 units from 5,898 a year earlier. That amounted to 4.7 months of supply, up from 4.4 months in October 2012.
According to Miami Realtors, the October drop in single-family home sales in Miami-Dade was because of fewer closings involving foreclosures and short sales, while traditional sales rose 13.5 percent year over year. For Miami-Dade condos, fewer short sales accounted for the slight dip in those closings in October, as both foreclosures and traditional sales posted year-over-year gains.
“While traditional sales showed strong gains, short sales greatly declined due primarily to the government shutdown delaying transactions requiring tax return verifications. Delays in FHA funding and other government-related factors also contributed to fewer closings in October,” Miami Realtors said in a statement.
The government shutdown “had a little bit of an impact on closings,” said Liza Mendez, broker-owner of Pedro Realty International and chairman elect of the Miami Association of Realtors.