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Miami Beach – 3rd Quarter YoY Comparison – Luxury Single-Family Homes

10/08/2014
ben moss, miami real estate blog, miami luxury re trends

At the close of a quarter, I like to compare the historical performance of submarkets, as key metrics tell a story and help project what could happen in the future. We all know that the real estate recovery has been going strong on Miami Beach for the last few years. If we take a look at the single family home market on Miami Beach in each of the last three quarters for sales above $1,000,000, there is evidence that the market has progressed well, but there are some interesting notes. 

- 2014 Average Price/Sq. Ft. is 19% higher than it was in 2012. In 2013, we actually saw a dip of 9.5%, which would not be indicative of a strengthening market year-over-year.  However, the entry level to the luxury market (in the $1 MM range) dominated the amount of sales in the 3rd Quarter of 2013 versus 2012 and 2014. Approximately 70% of all sales were in the $1 MM range in 2013, versus only 43% and 47% in 2012 and 2014, respectively. Typically, the more luxurious and unique a property is, not only will it sell for a higher absolute price, but also a higher price-per-square foot as well. 

- The 3rd Quarter 2014 witnessed three sales at or above $1,500/square foot. There was only one sale in 2013 at just under $1,500/square foot, and the highest sale in 2012 was at $1,228/square foot.

- The negotiation window has become tighter since 2012, when the average sale price was about 13% lower than the average list price. In 2013 and 2014, those ranges have been 8% and 7%, respectively, which has indicated a market in the favor of sellers.

- The average length that a sold property was on the market has increased since 2013, but is still far below what it was in 2012. Increasing inventory and days on the market indicate that the market is cooling off and tilting back to equilibrium. 

- I don’t see any major reason for a drastic change in the market for the foreseeable future in Miami Beach. Miami is growing into a true, world-class, international city which will continue for at least the next decade. Sure, we have some issues (infrastructure, transportation, rising sea levels) to deal with, but I see a market in relative equilibrium going forward in the short-to-mid-term for luxury single family houses on Miami Beach. Prices have risen quite a bit, so it’s healthy for the market to see more modest price gains at this point.

2012

Total Sales: 28

Average List Price/Sq. Ft.: $728

Average Sale Price/Sq. Ft: $627

% Difference $SP/$LP: 87%

Average Days on Mkt: 317

# Sales Above $10 MM: 3

% Sales Below $2 MM: 43%                           

2013

Total Sales: 53

Average List Price/Sq. Ft.: $611

Average Sale Price/Sq. Ft.: $568

% Difference $SP/$LP: 92%

Average Days on Mkt: 135

# Sales Above $10 MM: 2

% Sales Below $2 MM: 70%

2014

Total Sales: 51

Average List Price/Sq. Ft.: $813

Average Sale Price/Sq. Ft.: $749

% Difference $SP/$LP: 93%

Average Days on Mkt: 173

# Sales Above $10 MM: 3

% Sales Below $2 MM: 47%

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By: Ben Moss

Estate Agent | ONE Sotheby’s International Realty

Email: Ben@BenMossGroup.com

Phone: 305.793.4783

Visit Ben’s Website: www.BenMossGroup.com

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