Market strong and active with pinch felt on supply side under-$1 million
By Marilyn Bowden
Third-quarter activity in Miami-Dade's residential market remained strong, market watchers say, with inventories of new and relisted properties increasing - particularly in higher price categories.
The county's inventory of resale single-family homes, which has been plummeting for about three years, began to show signs of leveling off last May, said Ron Shuffield, president of Esslinger Wooten Maxwell Realtors.
"A year ago," he said, "we had more units and fewer sales."
Facts & Trends, a monthly market report from Esslinger that charts data from multiple listing services, recorded 16% more homes on the market in September and October.
Because data from September were skewed by the general business hiatus following Sept. 11, Mr. Shuffield said he compared figures for June-August 2001 with third-quarter figures from 2000.
The 2001 figures show average monthly sales of 1,184 single-family homes compared to 1,093 in third quarter 2000.
That represents a 4.5-month supply, based on a formula of inventory divided by average sales. Mr. Shuffield said a six- to nine-month supply is optimal.
"Ideally," he said, "we would have an inventory of 7,000-10,000 instead of 5,385."
He said the heightened activity is influenced by lower interest rates.
The sale price of homes in Miami-Dade appreciated 14% over the past year, from a median of $140,500 to $160,300, according to the Florida Association of Realtors. Only Daytona Beach, Fort Lauderdale, Fort Myers, Fort Pierce and Gainesville recorded sharper increases.
As a result, Mr. Shuffield said, single-family homes in the under-$200,000 range are increasingly scarce.
"A lot of people looking for homes in that range will move to condos," he said.
At the other end of the scale, the inventory of luxury homes, listed at more than $750,000, jumped 52% in the past year. Again, a portion of that would be due to price appreciation. Miami-Dade now has 506 resale homes for sale at more than $1 million, he said - a 16.3-month supply at the current sales pace.
"Part of that is a reflection of uncertainty of these months ahead," Mr. Shuffield said. "In my opinion we won't see a fallout of value, we'll see probably a much slower appreciation rate over this next year."
"Miami-Dade has been on a tear," said Bradley Hunter, Florida director of consulting with American Metro-Study Corp., which tracks housing starts across the country. The company's Miami-Dade Executive Summary for the third quarter reported construction began on 417 single-family homes, 28.6% more than a year earlier.
"Compared with the last year, under-construction inventory rose by 610 units to 2,918," Mr. Hunter said. "Finished vacant inventory increased by 17.8% from 488 units last year to 575 this year.
"Countywide, finished vacant inventory is up versus a year ago, but still at a low level" of 1.4 months' supply.
"The only place where built inventory is accumulating,' Mr. Hunter said, "is in South Dade-Homestead."
The county's condo market, which now represents 46% of all resold homes, according to Facts & Trends, is in many ways similar to the single-family home market.
"Inventories and growth of inventory have never been so close," Mr. Shuffield said.
The 5,391 condos on the market at the end of October, he said, represent a 17% increase in inventory over eight weeks, or a 5.2-month supply.
With inventory up 123% over the past year, "the luxury condo inventory may be cause for concern," Mr. Shuffield said. He said it represents a 41-month supply, not counting numerous new luxury projects under construction.
Land platted for construction is dwindling, Mr. Hunter said, with only 724 sites, a 4.1-month supply, available in Southwest Dade, where demand is strong. Lot supplies are highest in South Dade-Homestead, he said.
He said the Kendall-Southwest new-home market south of Tamiami Trail, west of the Florida Turnpike and north of 184th Street surged in the third quarter.
"In the first half of the year it was the Doral-Northwest market," Mr. Hunter said.
The strongest resale markets were Pinecrest and Coral Gables, Mr. Shuffield said.
"Families want to locate there," he said. "In the under-$1 million price ranges we have a very low, low inventory."