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.
All Miami Beach Condos
- The average sales price for a condo in Miami Beach was $801K.
- The average price per square foot was $597, down 2.6% from last year.
- The number of sales in this market jumped 23.8% over the same quarter last year, clearly inflated by the hurricane in Q3.
- Days on the market decreased 43.3% to a healthy 72 days.
- Listing inventory rose 7.5% over the same quarter last year.
- Listing discount was largely unchanged at 9%.
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.
Miami Beach Luxury Condos
- The average sales price for a Miami Beach luxury condo was $3.96 million.
- The average price per square foot for this sector of the market was $1,210, down 1.5% from last year.
- The number of sales in this market has increased by 22%.
- Days on the market decreased by 46% to 92 days.
- Listing inventory declined 18.1% over last year.
- Listing discount declined slightly to 11.3% discount from last asking price.
- The entry threshold for Miami Beach luxury condo segment was $1,520,000.
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.
South Beach Condos
- The average sales price for a South Beach Condo was $586K.
- The average price per square foot for this sector of the market was $663, down 17.1% from last year.
- The number of sales decreased by 15%.
- Days on the market decreased by 48% to a healthy 66 days.
- Listing discount declined to 9.1%.
Bal Harbor Condos
- The average sales price for a Bal Harbour condo was $2.6 million.
- The average price per square foot was $1,190.
- There were 24 sales in this neighborhood in the quarter.
- Days on the market declined to 79 days.
Downtown Miami Luxury Condos
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 average sales price for Downtown Miami Luxury condos was $1 million.
- The average price per square foot $452, up 8.1% from last year.
- Sales activity in this market declined by 6.6%.
- Days on the market declined to a healthy 75 days.
- Listing inventory rose 4.8%
- Listing discount was slightly higher than last year at 8.1%
The Miami luxury 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: