The Market Moving Forward

In our evaluation of Douglas Elliman’s third quarter review, we noted a total market slow down in relation to 2013, which was welcome considering the previous year’s record-breaking increases. While 2014’s final three months reflected a trending towards a more balanced market, it was largely a rebounding period, in which buyers demonstrated a persistent demand, even despite the winter season. For Miller, who compiled the data, the most promising finding of the report is “that sales activity continues to remain at a high level and rising.”

In Miami, where prices are on the rise, several in the industry have expressed concerned regarding the real values of properties compared to median sales price. But Miller pointed out that while prices are rising, the increases are skewed because of the composition of sales.

“The market share of non-distressed sales increased 4.8 percent to 67.4 percent of the market. Conversely, there were less lower-priced distressed sales,” he said. “In addition, we are seeing an inflow of higher-end development, which is also skewing prices higher.”

Miller went on to say that he expected distressed activity to continue declining as the economy and market improves, and buyers’ interests shift more towards higher-end condos.

There are many in the industry raising concerns over Miami’s international market, considering the rising strength of the U.S. dollar, but, as Miller was quick to add, the key driver for a large share of buyers is to find a “global safe haven for long-term investing.” The Magic City market is moving forward, structuring itself to satisfy investors who’ll keep their money in Miami, unlike investors who were working inside a short window of opportunity in the prior boom.