Market Lessons Learned from Our Miami Real Estate Blog
We’ve loved every minute of the last six months in writing our Miami real estate blog. We’d like to give a big thank you to everyone out there for making our posts the most shared out of any blog in South Florida. And there is plenty more great content coming up. Along our path to writing our stream of content, we have learned quite a bit about the current market. Now is a great time to share some of those insights.
Looking at the big picture, we are going to state the obvious first — the market is on fire. The summer months were once a time when real estate activity came to a major standstill in activity while agents, sellers and home buyers took vacations and focused their attention elsewhere. That is definitely no longer the case, as a steady stream of foreign buyers have been visiting and buying in Miami year-round. Through our real estate blog covering Miami, we previously defined the explosion of foreign buying activity here. When a group out of Argentina pays $125 million for an acre of property in downtown Miami, they are placing a big bet and vote of confidence on the strength of the residential real estate market.
Good News Keeps Coming
A reason why we started our Miami real estate blog was to display relevant market data in a timely fashion, so that you could use this information to always have a good feel for market sentiment. We’ve learned that the market is still continuing its decisive upward trend. The June sales numbers from the Miami Association of Realtors is displaying a 2% increase in the volume of residential real estate sold over last year and a stunning 9.5% increase in the number of single-family homes sold year-over-year. Both the median sales prices for condos and single family homes also increased with homes increasing by a 6% year-over-year amount and condos displaying a 2.6% increase.
Boom for New Residential Construction
We’ve learned that there is a massive pre-construction sales boom happening at the moment. We’ve profiled a number of these exceptional buildings through our real estate blog and have been quite impressed with the innovative development plans and brilliant architecture. A beautiful example is 321 Ocean, which will be built on the sand within the South of Fifth neighborhood. You can see more of that magnificent building here. We’ve had a great deal of feedback about this boom of new buildings. Most notably, questions fly in about an oversupply of units crashing the market. Will another major crash hit this year? In answering that question, its best to first look at the delivery timeframe for the majority of the buildings that will be coming to the market. At the moment, there are really only a handful of new buildings that will be delivered in 2014. The majority won’t be hitting the market until 2016. While we don’t have a crystal ball, construction schedules are telling us that we should have two or three more years of quality appreciation prior to any downside risk.
Cash Brings Comfort
It’s important to note that the new building acquisitions are fueled by 150% more hard cash from buyers than in the last market. Instead of placing only a 20% deposit down, the new standard is 50% – big difference. The last market crash was fueled by buyers bailing out of their condo purchases because they could afford to lose the mere 20% deposit. The new deposit structure is much more stable.
The Magic City Shines
Lastly, we have learned that Miami is the bomb! Well, we didn’t actually learn this, we have just re-remembered why the Magic City is so awesome. Thanks for following us. It’s our goal to continue to be the top Miami real estate blog and bring you highly informative articles. We’ll continue to give you some great data and fun stories as well (like the Top 5 Condo Party Buildings on South Beach).