Luxury Condo Sales Rising Along With Inventory In Miami-Dade
A report of EWM Realty International shows luxury condo sales, defined as units priced over one million dollars, increased their sale rate by 47% year over year in the December to February time frame. Despite the increase in sales rate, the luxury condo market inventory did rise in this same period. This report excluded the new pipeline of luxury development in the area.
Additionally, EWM’s president, Ron Shuffield, expects the gap between asking price and selling price to increase moving forward. The current report shows the average unit selling at 84% of the asking price, but Shuffield thinks the market still has plenty of overpriced units that will have to come down further to make a sale.
The market currently has a 41-month supply of luxury condos for sale, which is far off of the ideal. Ideal markets have a 6-month inventory available at any time, though luxury markets specifically tend to be more in the 12 to 18-month range. Shuffield explains whichever metric you want to use as the goal; the Miami-Dade market is overfilled at the moment. Inventories have risen by 7% year to year as of February 2018. This growth brings the market to a total of 2,857 units for sale.
In the months the report details, the average unit spent 200 days on the market before sale which is an 11% increase over the previous year. Also, the median price fell 5% to $1.5 million.
At the time of writing, 63 units had been sold in March with more expected to close before the end of the month. The end number might fall short of last year’s sales year to year. March 2017 saw a total of 91 sales which was the highest monthly sales of 2017.
Shuffield expects prices of the current condo inventory to continue to fall towards buyer’s expectations which should increase overall sales as the two numbers converge. Developers are also noticing the slowdown waiting for units made in 2015 and 2016 to clear out. Developers continue to plan and assemble teams for the next wave of luxury condo development.