By Mike Colpitts
The hardest hit real estate market in the U.S. is making a resounding recovery as existing condominium sales in Miami surge 85% in the month of March, according to the Miami Association of Realtors. Condo sales topped 1,500 units.
The increase is attributed to lower priced units and near record low mortgage rates, which have kept under 5% on a 30-year fixed rate mortgage for nearly a year. However, lower priced condos also attracted a large percentage of cash buyers with more than 64% of transactions being purchased by cash paying buyers.
International sales represented 60% of closed re-sales as purchasers came from around the world to buy condos at the lowest prices in more than 15 years. More than 90% of new construction condos were purchased by non-U.S. buyers.
Across Florida, condominium sales jumped 24% in March and home sales moved 12% higher. Lower priced foreclosures and bank-assisted short sales composed the highest number of sales as bargain hungry purchasers turned out to take advantage of the marketplace.
“Current strong sales levels are even more impressive when you consider that last year at this time sales were boosted by the first-time homebuyer tax credit,” said Miami Realtor Chairman Jack Levine. “But Miami and South Florida continue to outperform last year’s healthy real estate sales levels and the U.S. real estate market, reflecting the truly unique nature of our area and market.”
Short sales and foreclosures are continuing to have a massive impact on prices in Miami, where 60% of all closed residential sales in Miami-Dade County were distressed, including REOs and short sales.
The median sales price of condominiums dropped 30% from year-ago levels to $97,400, but showed a slight 3.6% uptick from February. The median sales price of single-family homes in March declined 19% to $159,800 from a year ago. The largest share of sales are distressed properties in lower price ranges that disproportionately reflect median sales prices.
The inventory of residential listings in the area declined nearly 24% from a year ago, also demonstrating that the market is making inroads towards recovering, while the total U.S. inventory of properties listed by real estate agents and brokers rose 1.5% for the month.