Surge in Entry-Level Homes Boosts Sales, Drops Price in Miami
Miami home sales took the usual December to January decline, but sales volume was the highest for the month since 2007, particularly in entry-level housing units, according to the latest research from MDA DataQuick.
There were 6,894 new and resale houses and condos sold in the three-county Miami market during January. That’s down 16.5% from December, but up 35.7% from 5,079 in January 2009. While it’s the highest sales total for a January in three years, the January 2010 total was 29.1% below the month’s average for all years since 1997. However, the decline from December to January was less than the running average of 20%.
The Miami market has experienced 11 consecutive months of year-over-year price gains. The existing market is on a 14-month-long run, while new homes are on an opposite trend — sales fell below the year-ago level for the 43rd time in the last 44 months.
New home sales were off 34.2% from December and 20.6% from January 2009, the lowest level of new home sales since at least 1997, DataQuick said. New homes accounted for only 6.8% of total sales in the market, compared to 8.6% in December and the January average of 20.2% that runs for the past decade.
Sales for homes priced below $200,000 accounted for 66% of total sales, up from 60.9% in December and 56.7% a year ago, a result of the homebuyer tax credit that’s luring first-time buyers into the market, and an increased presence of investor-buyers, DataQuick said.
In addition, homes sold for $1m or more totaled 131 in January, down 46.1% from 243 in December, but up 14.9% from 114 in January 2008. Homes that sold for $1m or more peaked in June 2005, when 583 homes were sold.
In January, the median price for all new and resale homes and condos in Miami was $140,000, down 9.7% from $155,000 in December and down 20% from $175,000 in January 2009. It’s the first month-over-month drop since a year ago, when prices dropped 12.5% from December 2008 to January 2009, but the decline is normal between the two months, DataQuick said.
The 20% decline from January 2009 to January 2010 was the smallest year-over-year drop since the median price declined $245,000 in August 2008, but it marks the 28th straight month of year-over-year decreases. The January median was 51.7% off the peak median price of $290,000 from June 2007.
The median price for resale homes in January was $175,000, down 6.9% from $188,000 in December, down 12.5% from last year and down 48.5% from the June 2007 peak median of $340,000.
DataQuick said 46.6% of mortgagors funded their home purchase with Federal Housing Administration (FHA)-insured loans, up from 42.5% in December and 49% a year ago. Just two years ago, FHA-backed mortgages accounted for only 6.5% of the total market.
Absentee buyers — often investors, but who indicated at the time of sale that their property tax bill would be sent to a different address — purchased 33% of all homes sold in Miami in January, up from 29.3% in December and 26.7 percent a year ago. In addition 2.9% of the homes sold in January were flipped within a three-to-six week period. That’s up slightly from a flip rate of 2.8% in December and up from 1.4% in January 2009.
Cash buyers accounted for 58.5% of all January sales, and the median cash purchase sales price was $95,000. DataQuick measures cash purchasers as transactions where there was no indication of a purchase loan recorded in the public record at the time of sale. However, some of these cash buyers could have used alternative financing arrangements outside of a typical purchase mortgage, and in some cases these buyers might be taking out mortgages after their purchases.
Write to Austin Kilgore.
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