End of glut: Miami-Dade housing inventory dwindles rapidly
By Yudislaidy Fernandez
Miami-Dade's housing inventory is dwindling as internationals continue a buying frenzy for real estate at discounted prices, reflecting a more balanced market with six months of housing supply.
If sales stay at the current pace, the existing inventory would be absorbed by year's end, making the question of how much inventory is coming down the pipeline key to forecasting what's ahead for the local housing market.
Inventory housing, consisting of single-family homes and condos, has dropped 21% since Jan. 1 and 60% since August 2008, according to data from the Miami Association of Realtors and the Multiple Listing Service.
Peggy Fucci, senior vice president of sales and marketing at ST Residential, which owns a large portfolio of condos, is slowing down sales at towers close to sold out.
The 530-condo Mint at Riverfront began sales in January and has sold 380 units, with 150 left, Ms. Fucci said.
At the 459-unit Infinity at Brickell, sales began a year ago and 50 units remain.
ST Residential has three new condo towers coming online by year's end, Paramount Bay in the Omni area, Artecity in Miami Beach and Dolcevita in Palm Beach Shores.
Overall, 10,459 condos and 6,517 single-family homes are available for sale in Miami-Dade, according to realtors association data.
With sales now averaging 2,117 per month — higher than every year in the past 10 except during the peak in 2005 — if the sales rate holds this inventory will get wiped out by year's end.
The unknown is what will happen with the distressed properties in the pipeline, including when they will get released to the market for sale, as that could significantly impact Miami's housing recovery.
"The fear that is keeping pressure on pricing is the fear of the unknown. How many foreclosures may still come to market?" said Ron Shuffield, president of Esslinger-Wooten-Maxwell Realtors. "I don't think anyone really knows for sure. We know a substantial number of foreclosures are out there."
International buyers are the protagonists on Miami's real estate stage right now, as they are actively buying units as investment with the aim of renting them now and in several years, when the market strengthens, selling them at a profit.
In South Florida, the leading buyers are Venezuelans at 28%, Canadians 10%, Brazilians 9% and Argentines 8%, the data show.
The median price of homes acquired by international buyers in South Florida is $272,700, with most buying in the price range of $300,001 to $400,000.
While Miami's sunny beaches remain an important asset, low interest rates, discounted prices and increased accessibility to Miami, as more airlines add flights to Miami International Airport, are key factors fueling sales.
"The reasons I believe our demand will continue to increase is the extreme value people today believe they are receiving," Mr. Shuffield said. "Interest rates are still lower than they have been in the last 50 years and the [currency] exchange rate is also favorable."
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