Record residential sales in Miami-Dade on horizon led by $300,000 range
By Yudislaidy Fernandez
For those with the cash or ability to get financing, this is the time to buy a home in Miami-Dade. What's the catch? Not getting beaten by other buyers.
With international investors with cash in hand scouting the market for attractively-priced properties that can yield a profit and many residents looking to take advantage of these more affordable prices to become a homeowner, competition for homes is stiff.
Single-family homes priced under $300,000 currently represent 79% of total sales and 55% of total inventory in the Miami-Dade housing market, figures from Esslinger-Wooten-Maxwell Realtors's Facts and Trends April report shows.
Condos under $300,000 comprise 85% of total sales and 60% of the total inventory in the market.
"If priced right, homes are selling relatively quickly and more than one offer is coming in for a seller to consider," said Sherrie Porter, EWM's senior vice president and general sales manager.
The competitively-priced homes available in many Miami-Dade neighborhoods today is a direct result of the abundance of distressed properties in the market.
Right now, two-thirds of home sales in Miami-Dade are either short sales or foreclosures, Ms. Porter noted.
But, in most instances, it's tough for local buyers to compete with international investors because they don't have the cash.
In these cases, the buyer with the cash has the advantage, said Emilio Palomo, broker owner of Riteway Properties III.
"When a bank has an all-cash offer versus typical users with financing, often times they will go with the lower offer just knowing they will close," he explained. "It puts the typical buyer at a disadvantage because most of them don't have the cash to close."
For example, he said, he is working with a group of Venezuelan investors who are searching for units under $300,000 that already have tenants. They plan to pay in cash.
Because prices have decreased, Mr. Palomo said some buyers mistakenly think they can get a house for significantly less than its listing price, but that's generally not the case.
As inventory continues to be absorbed, realty agents are to focus more on getting listings and not just making sales.
"We are going to need to concentrate on getting listings because inventory levels are going to start dropping," Ms. Porter said. "But it's all good stuff that's going on right now."
About four years ago, the median price for a home in South Florida was $400,000 compared to today's median of $152,000, showing the tremendous increase in home affordability.
At the time, not only were many middle-income families priced out of the opportunity of owning a home, but also companies contemplating relocation saw the high home prices as an obstacle to move here.
This adjustment in the housing market couldn't have come at a better time for Miami-Dade, where right now the median income is $50,000.
To buy a home, Ms. Porter said, the rule of thumb is typically 3 to 3.5 times a person's annual income, which translates to $150,000 and $175,000.
"We are finally at a point where the median price for a single-family home is now at $152,000 and housing is once again within reach for so many," she said.
With the level of activity being seen so far this year, 2011 could be record-setting for homes sales in Miami-Dade.
In 2005, about 2,201 sales took place per month in the county, an average that dropped by about half in 2008, with 1,100 sales per month, according to the report.
In the first quarter of this year, the sales average was about 2,348 per month — higher than in 2005's active market.
As an industry, Ms. Porter said, "we are on track now to sell more than we have ever sold in Miami-Dade County's history."
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