Although the Miami Beach and Downtown Miami luxury real estate markets were largely on the rise before Hurricane Irma in September 2017 and continued after, rebounding substantially from the hurricane’s impact, the sales trends overstated the market for Q4 2017. The hurricane disrupted the process of many sales, which were moved into Q4, making the surge Miami Beach condo sales activity up 58% from Q3 to Q4 seem more dramatic than it was.
Ultimately, the Miami Beach luxury real estate market is healthy, regardless of the hurricane’s impact. We’ve seen large decreases in the time properties have spent on the market from year to year, indicating a quicker-paced, evolving investment market for buyers. In addition, we’ve seen decreases in the price per square foot making it a potentially interesting time to buy. In addition, there are other factors that will benefit Miami real estate markets in the short and long term, such as the lack of new development in the pipeline and anticipated benefits from the new tax reform.
As noted above, this year brought with it a large gain in the number of sales, but skewed more towards bigger units with the average unit size being around 1,460 square feet based on the above data and the fact the average sale price of units was $801K. Sales have increased, outpacing the increase in inventory. In addition, marketing time has fallen. These factors all demonstrate sales demonstrated strength in the market.
Within this market sector we’ve seen surges in sales activity and decreases in both prices and marketing time. Though this is positive for the investor, it does mean that negotiability on prices drops as well, as the market has become more active.
"The Rise of Bal Harbour and Surfside Real Estate"
Downtown Miami has a vast range of properties in different price points. For purposes of this report, we only focus on the Downtown Miami luxury condo segment, which is the top 10% of the market. The entry level for luxury condos in Downtown Miami, unlike other luxury markets, is a low $480,000.
The Miami real estate market is doing well in the wake of Hurricane Irma. 2017 was a more stable market than 2016, even with the hurricane. We anticipate confidence will build throughout 2018, with 2019 and beyond being very strong for Miami luxury real estate. Inventory growth has been reigned in and the new tax reform will significantly benefit Miami luxury real estate for many reasons. To learn more about these two topics, I encourage you to read our two latest blogs: