Residential Real Estate in Miami-Dade Sees Gains as Inventory Increases, Experts Predict Growth for 2025
Published Date: January 24, 2025
Experts are looking to 2025 as a year of growth in the residential real estate market in Miami-Dade, as more inventory flows back into the market. Ron Shuffield, President of Berkshire Hathaway, noted a significant increase in available inventory, which is creating more options for buyers and helping to stabilize prices. With more properties available, the market has become more balanced, leading to better conditions for buyers. Shuffield emphasized that the key metric to watch is the monthly supply, which helps indicate the balance between supply and demand.
For a balanced market, Shuffield highlighted the importance of maintaining a six-to-nine-month supply of homes. When that supply drops below six months, competition among buyers increases, leading to price hikes. During the COVID-19 pandemic, Miami’s market saw just one to three months of supply, which resulted in double-digit price increases.
Despite a slowdown in the pace of home price growth, Shuffield observed that prices have plateaued at a higher level compared to pre-pandemic rates. As of December 2024, 5,041 single-family homes were available on the market, a 26% increase from the previous year. However, the rise in inventory has not been met with equally strong sales, with sales dropping by 9.1% over the last three months of 2024.
Condominium units experienced a similar trend. Inventory surged to 10,425 available units, a 48% increase from December 2023, but sales for condos fell by 24% over the same period. Overall, transaction numbers dropped in the last quarter compared to the end of 2023. Shuffield attributed some of this decline to the changing rules and regulations surrounding condominium associations, which may have impacted demand.
The median price for condominiums decreased by 7.6%, dropping from $449,000 in March 2024 to $415,000 in November. Shuffield noted that with the current pace of sales, the condominium market now has 18 months of supply, double the optimal amount needed to maintain a balanced market. This excess supply could potentially drive prices lower, forcing sellers to sell at a loss.
In contrast, the median price of single-family homes remained relatively stable. Prices peaked at $670,000 in July but fell slightly to $660,000 in November. With eight months of supply, the single-family market is at equilibrium, according to Shuffield.
Shuffield also highlighted the financial dynamics at play in the condominium market, noting that 60-65% of condo owners are investors or lease their properties, with only 35-40% living in their units. This investor-driven market impacts the value of condominiums, as decisions are often based on financial motivations rather than personal residence.
Shuffield encouraged potential buyers to stay in the market long-term, citing the significant appreciation in Miami’s housing values over the past decade. The median price of a single-family home in Miami-Dade was $150,000 in January 2011, and today, it stands at $650,000 — a fourfold increase. This appreciation underscores the importance of staying invested in the market for long-term gains.
Original Article by Alexander Luzula /// Miami Today
