Real Estate

Yet More Evidence Miami's Real-Estate Boom Is Slowing (Especially on the Beach)

It's not quite crickets yet, but don't expect to hear quite so many cranes, nail guns, and saws — or the ring of your realtor friend's phone for that matter. All evidence points to a noticeable slowdown in the local real-estate market, and here's even more proof from brokerage firm Douglas Elliman. 

According to its data from the first quarter of 2016, sales in both the once-hot markets of Miami's urban core and Miami Beach have fallen off significantly since last year. 

In the Miami Beach area, which the reports details as everywhere from Sunny Isles Beach to Fisher Island, sales volume dropped 21 percent from the same quarter in 2015. The median price is also down from $437,750 a year ago to $408,750 now. Those numbers include sales of condos and single-family homes. 

Expect prices to go drop even more, because real-estate inventory on the Beach has soared at the same time. There was a 33 percent uptick in units on the market, which translates to 21.5 months' worth of supply. The number of days an average home sits on the market has also jumped from 53 days to 97. 

Which means if you've ever dreamed of buying a place on the Beach, it's time to at least keep an eye out. But don't rush. Conditions may become even more favorable for buyers in the near future. Major price adjustments usually take place a little while after signs of a slowdown. 

Meanwhile, in the mainland market, or at least that east of I-95, things are also shifting down a few gears, from a tourist speeding down the interstate in a rented Lambo to, well, at least a cautious mother of two in a Volvo. (But the situation has not yet gotten to snowbird in a vintage Oldsmobile.) 

In the first quarter, sales volume was down 17.5 percent from the previous year. Though, the median price saw a small bump to $404,020 from $393,343. However, inventory is 10.6 months' worth. 

In both markets, the biggest hit has been to the high-end luxury market. 

It's important to note that this slowdown was expected and almost certainly won't lead to an economic collapse like it did 2007 and 2008. Even under these conditions, developers are continue to announce new projects even as others have been delayed or canceled. 

The reasons are pretty much well known to everyone: Volatility in South American markets and a strong U.S. dollar have dried up the once-bountiful supply of foreign buyers. Meanwhile, local developers have struggled to find a replacement well of potential new condo buyers. 

Turns out other markets in South Florida are doing well by catering to the type of buyers traditionally associated with the market: retirees. According to CNBC, Boca Raton is now the best-performing market in the tri-county area by increase in sales volume. 

"Of all the major markets right now in [South Florida], Boca is the leader," Jonathan Miller, president and CEO of Miller Samuel, tells the station. "I think it's an area that's less correlated to the foreign buyers, and in Boca, the high end of the market is performing as well right now as the broader market."

If Miami's market doesn't want to slow to the speed of a snowbird behind the wheel, it might want to attract a few more actual snowbirds again. 
KEEP MIAMI NEW TIMES FREE... Since we started Miami New Times, it has been defined as the free, independent voice of Miami, and we'd like to keep it that way. With local media under siege, it's more important than ever for us to rally support behind funding our local journalism. You can help by participating in our "I Support" program, allowing us to keep offering readers access to our incisive coverage of local news, food and culture with no paywalls.
Kyle Munzenrieder