2009 Real Estate Market Review for Miami-Dade County

2009 ended and 2010 started with a flurry of activity. Buyers are realizing there's no advantange to wait any longer. Marc Roth with BusinessWeek posted an article Dec. 8, 2009 titled "If You Don't Buy a House Now, You're Stupid or Broke." Great history lesson on interest rates, how they affect loan costs, and why now is the ideal time to buy a house if you're going to. Interest rates are already starting to inch their way up in a trend likely to continue as the housing market and the economy in general show signs of improvement. Prices may not drop further in the area you're interested in and even if they do, the drop may be offset by an increase in interest rates. Inventory levels are dropping, reducing the quantity of homes to select from. If you want to buy a house, now's the time.

A lot of changes took place in 2009 that affect qualifying for a loan. Talk to your loan officer, figure out what you qualify for and get started.

So how did the housing market perform in 2009?

Here's some interesting sales data pulled from our local MLS database that applies to single family homes. Total sales for the last 4 years is listed for comparison and perspective:

Miami-Dade County

Total sales for 2006: 11,074 - 2007: 7,071 - 2008: 6,535 - 2009: 9,974

In 2008, 12.1% of the sales were bank owned properties. In 2009, 52% were bank owned sales. With over half the sales being bank owned property, the market for sellers was rough. The reality of prices adjusting after years of 30% + increases in value each year until our market shifted in April of 2005 was a hard pill to swallow. Our market here saw the beginning of a cycle change in the summer of 2008.

Home sellers took a long time to recognize the adjustment or decrease in value. They set high asking prices and many "chased the market" with reductions. Bank owned properties were priced based on Broker's Price Opinions (BPO's) and appraisals, so most had lower asking prices. Still, in early 2009 many of them sat with no activity for long periods of time until the price was reduced to what buyers were willing to pay. A home is worth what buyers are willing to pay, period. Their opinion of value changed in 2006 and as inventory levels increased to to the point where they could negotiate with a seller without competition for the same property. If the seller wanted to sell...

By the end of 2009, REO sales had changed considerably, with most getting multiple offers within a few days and selling for more than the original asking price. In early 2009, with so few sales in each area, it was difficult to find proper comparables to use as a guide for pricing property. With most people including banks preferring to err on the high side, sales took longer in early 2009 than they do today if the price is set correctly for day one of the sale. In most subdivisions today there are enough recent sales to easily calculate a narrow range of what an asking price should be set at and what the final sale price will most likely be.

In 2008, 7.4% of the properties that sold were short sales - 13.7% were short sales in 2009.

As of today, there are 8,408 homes for sale. 466 are bank owned (5.5%) and 3,035 are short sales. (36.1%) The quantity of bank owned property has drastically reduced. (in case you didn't figure that out from the 52% of the sales in 2009 were bank owned properties)

The Village of Pinecrest

Total sales for 2006: 168 - 2007: 137 - 2008: 131 - 2009: 168

In 2008, 2.3% of the sales were bank owned properties. In 2009, 13.1% were bank owned sales. In 2008, 3.1% of the properties that sold were short sales - 8.3% were short sales in 2009.

As of today, there are 176 homes for sale. None are bank owned and 24 are short sales. (13.6%)

The Village of Palmetto Bay

Total sales for 2006: 225 - 2007: 186 - 2008: 156 - 2009: 177

In 2008, 5.1% of the sales were bank owned properties. In 2009, 20.3% were bank owned sales. In 2008, 7.1% of the properties that sold were short sales - 9.6% were short sales in 2009.

As of today, there are 121 homes for sale. 5 are bank owned (4.1%) and 24 are short sales.(19.8%)

The Town of Cutler Bay

Incorporated in 2005, the MLS data for Cutler Bay sales reflects no sales in 2006 and only 55 in 2007. The first full year of sales reflected is 2008 with 120 total sales. 2009: 200

In 2008, 6.7% of the sales were bank owned properties. In 2009, 41% were bank owned sales. In 2008, 9.2% of the properties that sold were short sales - 20.5% were short sales in 2009.

As of today, there are 110 homes for sale. 14 are bank owned (12.7%) and 48 are short sales. (43.6)

The City of Coral Gables

Total Sales for 2006: 409 - 2007: 331 - 2008: 331 - 2009: 351

In 2008, 6.3% of the sales were bank owned properties. In 2009, 14.8% were bank owned sales. In 2008, 3.9% of the properties that sold were short sales - 8% were short sales in 2009.

As of today, there are 438 homes for sale. 9 are bank owned (2.1%) and 35 are short sales. (8%)

The City of South Miami

Total sales for 2006: 74 - 2007: 57 - 2008: 52 - 2009: 66

In 2008, 3.8% of the sales were bank owned properties. In 2009, 33.3% were bank owned sales. In 2008, 3.8% of the properties that sold were short sales - 10.6% were short sales in 2009.

As of today, there are 57 homes for sale. 3 are bank owned (5.3%) and 11 are short sales. (19.3%)

Take advantage of an ideal time to buy and have a Happy New Year!

Weekly Report for Pinecrest, Palmetto Bay and Cutler Bay

Sales activity data from our local MLS for the week of 10/18/09 - 10/26/09.

Village of Pinecrest

As of this morning Pinecrest has a total of 188 single family homes for sale. Only one is a foreclosure, 25 are short sales. 5 of the total available were added last week; none of the 5 are bank owned. 1 is a short sale.

4 homes went under contract last week. None of those were bank owned properties; 2 are short sales. There were no closings reported last week.

Village of Palmetto Bay

Palmetto Bay has a total of 143 single family homes for sale this morning. 4 are bank owned; 32 are short sales. 6 of the total were added last week; 1 bank owned and 1 short sale.

2 homes went under contract last week. 0 bank owned, 1 short sale. No closings reported last week.

Cutler Bay

Cutler Bay has a total of 91 single family homes for sale. 7 are bank owned, 41 are short sales. 5 of the total were added last week; 1 is bank owned and 3 are short sales.

9 went under contract last week. 2 are bank owned, 7 are short sales. 2 sales closed last week; neither were bank owned or a short sale.

Now is a good time to sell if you've been waiting and live in any of these areas. There's a small window of opportunity while there's little competition from bank owned properties and before things slow for the holiday season.

It's also still a good time to buy, but the "good deals" are dissappearing fast at this point. Better make you're move... Call us.

September data for Pinecrest, Palmetto Bay and Cutler Bay

September numbers are in. Here’s a quick comparison of how September 2009 compared to September 2008.

In Miami-Dade County, there were 46.2% fewer single family homes for sale at the end of September 2009 than there were at the end of September 2008, and there were 33.7% more sales recorded in September 2009 than there were in September 2008. The condo and townhouse market was similar with inventory levels down 29.4% and sales up 39%.

The Village of Pinecrest: 18.1% fewer homes on the market and sales up 171.4% from the same month a year ago. Available condos and TH’s went down 49.5% while sales remained steady with no increase or decrease.

The Village of Palmetto Bay: Inventory levels went down 47.9% while sales went up 47.1%. Condo and TH’s , quantities for sale decreased 41.7, sales went up 100%.
Cutler Bay: 61% fewer homes for sale in Sept. 09 than there was in Sept. 08. Sales shot up 52.2% Condos and townhouses numbers went down 43.2% while sales increased 400% from the same month last year.

Still not convinced the market is shifting? Take a look at the 5 year graph for Miami-Dade County real estate activity.

So what does this mean?

If you’re a buyer, your options to choose from are a great deal fewer today than they were last year. Fewer homes to choose from means competition with other buyers. Multiple offers are already occurring. As competition grows, so will the odds of you paying a higher price. Higher prices turn into higher appraised values for similar homes. Property values stop decreasing, level off, and start to rise again.

Bottom line… if you plan to buy, it really is time to get serious.

Victor Mills - 786-205-4207