Miami home prices soar as sales rise 19%, state group reports
By Marilyn Bowden
Sale prices of existing Miami-area homes soared 20% in May when compared to a year ago, to the state's costliest levels, and the number sold rose 19%, the Florida Association of Realtors reported Tuesday.
Closings in metropolitan Miami-Dade increased to 1,187 from 1,001 in May 2001. The median price hit $182,000, up from $152,100 in May 2001.
"We've had an incredible five-year run since 1997," said Michael Pappas, principal of The Keyes Co. "We had a record May, with close to $200 million in sales - a 33% increase in new written business over May 2001. There's no question that low inventory, low interest rates, increasing prices and higher demand have made it a strong market."
Appreciation is also driven by the continuing influx of affluent, business-savvy South American buyers, he said, who once came to Miami to invest and now are bringing their families here to live.
"Prices are escalating across the country," Mr. Pappas said. "How high can it go? We're starting to see some leveling off, but it will continue as long as interest rates are low, immigration high and the economy performing reasonably well."
Craig Werley of Craig A. Werley & Associates, a valuation firm, said the heated appreciation in existing housing is "pretty dramatic. But the availability of well-located land for new development is shrinking, and the approval process is slow. So there's some constraint on our ability to generate a good volume of new housing."
The anticipation that mortgage rates will soon rise also drives sales and the willingness to pay premium prices, he said.
According to Freddie Mac, the national average for a 30-year conventional, fixed-rate mortgage was 6.81% in May, down from 6.99% in April. It was 7.15% in May 2001.
Fort Lauderdale home sales in May rose 22% from 1,072 in May 2001 to 1,310. That was at a 13% higher median price, going from $170,700 to $193,500. Orlando's sales increased 12%, at 11% higher median prices. Jacksonville sales were unchanged, with prices up 9%.
The median price represents a midpoint; half of the homes sold for more and half sold for less.
The National Association of Realtors reported existing single-family home sales were essentially unchanged from April to May, remaining at historically high levels. The median existing-home price countrywide was $154,600 in May, up 6.6% from May 2001, when it was $145,000.
Regionally, May home resales in the West rose 15.7% over May 2001, at a median price of $215,300, up 11% from the same month a year earlier.
In the Midwest, sales of existing homes were up 5.9% percent above May 2001, with the median price of $131,800 representing a 5.4% hike.
Existing-home sales in the Northeast were 6.3% higher than in May 2001, though they slipped 2.9% from April 2002. The median existing-home price in the Northeast rose 7.1% to $156,600 over the past year.
In the South, resales declined 3.9% from April to May but were 0.9% above May 2001. The median price of an existing home, $148,100, was 7.8% percent higher than a year ago.
In California, where low inventories are also driving prices up, the California Association of Realtors reported sales in May 2002 increased 22.7% and the median home price rose 25.5% compared to May 2001.
The median price of an existing single-family home in California in May 2002 was $321,130. Statewide, the highest median home prices was recorded in Malibu, $995,000; Pacific Palisades, $872,750, and Beverly Hills, $863,750.