Miami’s market took a hit in November, but the longterm strategy remains sound.

Ebbing ever closer to 2014’s end, Miami’s real estate market, after two consecutive months of healthy growth, stumbled in November with sales falling considerably year-over-year while prices continued to rise, according to a new report from the Miami Association of Realtors and local MLS.

Since November 2013, overall sales in the city have fallen 9.2 percent. However, the distribution of losses is centered mainly in the local condo market, which doesn’t bold well for developers who have a veritable army of new units set to come on the market in 2015.

While single-family homes fell a negligible 1 percent in November, from 982 to 972, condo sales dropped a dramatic 15.5 percent. Prices for both properties types increased since the same time last year, but remain at affordable 2004 levels.

Prices Rise, Sales Fall

An evaluation of the single-family homes and condos revealed a more detailed picture of price increases and performance, which included:

• The median price of single-family homes rose 5.4 percent year-over-year from $232,000 in last November to $245,000.
• The median price of condos rose 5.4 percent year-over-year from $180,000 in last November to $189,777.
• The median number of days on market for single-family homes increased 20.5 percent year-over-year to 47 days, while the average percent of original list price received dropped 2.3 percent to 93.9 percent.

A Bump in the Road

Over the last twelve months, Miami has gone through a series of changes that have moved the city towards a more sustainable future. However, late year developments are somewhat discouraging as we head into 2015.

“While we have seen much needed increased inventory over the last couple of years, the number of existing properties being listed for sale is declining, particularly for single-family homes,” Francisco Angulo, 2014 MAR residential president, said. “New and pre-construction inventory is providing additional supply for condos, (but) inventory of single-family homes remains limited.”

This is particularly troubling considering the significant dip condo sales took in November. If the trend of falling sales and rising prices continue, Miami could be looking at a situation similar to the months leading up to the housing crisis where condo towers were forced to sit empty on account of an absent demand.

Still, 2014 MAR Chairman Liza Mendez is confident Miami is on the road to a full recovery.

“While we are experience more moderate growth, which reflects a healthier market and more balance between buyers and sellers, in Miami sales remain strong compared to the record sales activity of the previous three years.”