As the Miami Real Estate Market Shifts, Who is MOST Vulnerable?

What Will Happen to Miami Real Estate Prices in 2023?

Welcome back to another episode of the Better Decisions podcast. In this episode David Siddons speaks with mortgage broker Paulo Rodriguez of CrossCountry Mortgage LLC. In this podcast we discuss the state of the Miami real estate market and answer the most common question that we are asked every day: ‘What is going on in the market today?’ This podcast focuses on the state of the Miami real estate market as it pertains to the start of Q4 2022 and answers three key questions: 

  1. What is happening with the Miami real estate market? 
  2. In what areas could Miami real estate prices potentially drop in 2023? 
  3. When should sellers get out and should buyers buy or wait?

In addition, we discuss mortgage rates, the rental market, historic value appreciation, and a growing inventory across a number of sectors. As always, please call me for a more granular analysis of your personal situation.

What is Happening in the Miami Real Estate Market?

Buyers and sellers want to know where we are, where we are heading, and what to do next. Many reports talk about the Miami real estate market slowing down. The market movement has slowed down but has not stopped or completely reversed. It went from 100 miles per hour to 60 miles but is not depreciating.

What Will Happen to Miami Real Estate Prices in 2023?

Sales velocity is slowing down because of a ripple effect of increasing mortgage rates, talks of a recession, and the pullback of the stock market. This all affects buyers and even sellers. The market went from the sublime to the ridiculous, and that kind of market is not sustainable. Trees do not grow to the sky, and the upward trend had to stop somewhere. We came from a position of mayhem and desperation. List prices used to be the floor of the negotiation, now they are the ceiling. Buyers have more options and negotiation power as more inventory enters the market. Will Miami real estate prices drop? No, we still have inventory issues in many of the markets. Inventory is increasing, but the levels are still lower (by 42%) than in 2019.

Will Miami Real Estate Prices drop in 2023? As the Miami Real Estate Markets Shift, Who is Vulnerable and who is not?

While Sellers look at the past, Buyers look six months ahead

We come from one to three months of inventory in markets where ten months would have been good. These days, inventory levels are growing, pending deals are down, and new listings are up. The quality of these listings, however, is not stellar. There is not a lot of wow-product, and sellers are still looking six months back when pricing their homes. While sellers look at the past, buyers look six months ahead. We experience a massive discrepancy between what one group wants to receive and what one group wants to pay. Sellers shoot for the moon and ask for too much money. They saw their neighbors do the same, and buyer desperation made this possible 6 to 12 months ago. Sellers will have to come to their senses and price their homes according to today’s market. Sellers who bought in 2021 and add 30% to that price in 2022, will not sell. That has nothing to do with the state of the market, it means sellers are unrealistic and need some time to realize the market has shifted.

The Role of the Media

The media often paints a different picture of the Miami real estate market. This is not always in line with what we experience in the market. Firstly, journalists do not have access to the same data we have. Secondly, they use click-bait titles to get as many clicks as possible. The dramatic titles are often taken out of context and create a level of fear or bearishness that is not justified. Miami sees a 100% increase in foreclosures sounds scary, but if we had one foreclosure last month and two this month, that is a 100% increase. Lastly, you cannot discuss the Miami market without looking at the different submarkets. Condos behave differently than homes, and the $1M market reacts differently to economic changes than the $10M market.

Appreciation

South Florida and Miami saw a 25% to 50% increase in real estate prices in 2020 and 2021. Previous to those years, the appreciation was around 6% to 9%. In 2022, 9% to 11% was expected, most already happened at the start of this year. The moderate expected appreciation for 2023 is 3.8%, which is the historic average appreciation.

Mortgage Rates and Miami Real Estate

Many buyers ask about the effect of mortgage rates on the Miami real estate market. It does affect some sections of the market, but it does not affect our market around Coral Gables, and Pinecrest so much. The lower end of the market is most affected by interest rates. This market gets rates between 6% and 7%, while investors or the more exotic investments get an 8% to 9% rate.

The higher loan amounts of $1M and up have better rates in the mid to high 5% range. Banks are sitting on cash and are willing to lower these rates to acquire a client. Private bank clients with good banking relations can obtain an even better rate. Wealthy buyers also often use margin loans to finance a deal.

In some sections of the market, the interest rates will impact, but not so much in the luxury segment. Many of our buyers also pay in cash. According to Paulo, 50% or more of all $1M+ deals in Miami-Dade are not financed. In this market, the buying decision is more about the right time and less about the mortgage rates.

Is the Rental Market Sustainable?

The rental market has seen a massive increase in prices. The question is whether these high-rental markets are sustainable. Rental prices and the value of a property are closely correlated. A decrease in rent can lead to decreasing property values. The question is whether this hot rental market is sustainable. This is a very Miami-specific conversation since the Miami market behaves differently than the rest of the US market. The cost of living in Miami is out of touch with the median income. Relocation buyers or renters with income levels from NYC or California arrived in Miami. These buyers/renters are no longer paying state income taxes and encountered a real estate market that was very affordable compared to their home markets. They do not mind paying over the asking price because for them this market is still very affordable. As a result, they priced out local buyers and renters.

These days locals find it hard to afford a Brickell condo for rent. Condos that previously rented for $3,500 per month, are now going for $5,000 while income levels have not increased. This is something to worry about because any correction in this rental market will change the value of those properties.

Will Miami Real Estate Prices drop in 2023? As the Miami Real Estate Markets Shift, Who is Vulnerable and who is not?

Should Condo Owners Get Out?

The condo market is more investor-driven than the single-family home market. Within the condo market, we see different neighborhoods or price ranges perform differently. Our analytics tool Condo Geeks shows a 15 years overview of the sales prices per neighborhood, condo, or price range. This tool will help you navigate the different condo markets and provide insights into the more volatile markets.

There are several markets like Brickell that are very investor driven. Investor-driven markets, with short-term investors, will have some correction as inventory grows. If you have a 10-year horizon, there is nothing to worry about. If you are in this market for the short term or are looking to sell in the next two years, then today is a good moment to sell.

We see more inventory and fewer pending sales. In combination with negative press, whether true or not, it encourages the more speculative sellers to get out as soon as possible. This is a final call before the market makes a more substantial correction, and Miami real estate prices in the condo market might stagnate. Generic or older condos (especially the ones with impending assessments) are the most vulnerable at the moment. Larger condos, that are primary residences will be more resilient. 

The Latin American Market

Several areas like Sunny Isles Beach or Miami Beach are still doing very well, although I expected to see a growing inventory. I can speculate it has maybe something to do with South American buyers coming into town. When socio-economic changes happen in Latin America, we see waves of buyers enter Miami to distribute their wealth and invest in the dollar. These wealthy buyers are relocating funds rather than being speculative or making quick investments. The current round of new construction condos sells from $1000 per SF. The best new condos are even in the $2,000+ range, with record-breaking prices for areas like Edgewater or Brickell. Please read our latest article in which I present our top 5 new construction condos in Miami.

There are risky sections in the condo market that are important to know. If you are an investor who speculates on the market and still wants to make money, now is the time to sell.

Should homeowners Sell Now?

The single-family home market has always been more stable than the condo market. Condos and homes behave differently. You can build a ton of condos, but you cannot keep building homes, especially in an area like Miami, bordered by the everglades and the ocean. Moreover, new homes take around 2 to 3 years to complete. We do not have enough land, and labor and material are expensive.

As mentioned earlier in this article, we have many new listings, and pending and closed sales are down. For the market to see a drop in value or for Miami real estate prices to drop, it would take a massive increase in inventory. The market is healthy, there is demand, and Miami is growing as a global city. In addition, we are still low good quality product. You cannot defeat the law of supply and demand.

The biggest problem right now is sellers not being realistic. Sellers have been asking for whatever they wanted, and this was met by buyer desperation. That momentum, however, is over. This is not the market we experienced 6 to 12 months ago. If you want to sell your home right now, you need to price your home right. You will still be able to walk away with a good profit. Many sellers bought for top dollar in 2020/2021 and are now trying to resell the property with a 50% increase. It will simply not sell in this market.

We just listed a newer home, and the phone rang non-stop. New homes are what everyone wants, and these will stay desired and can ask for a premium. Older, less unique houses, however, will be harder to sell. We do not expect any depreciations, but you will not see the same amount of profits anymore. List prices went from the starting point of negotiations to the absolute ceiling.

Conclusion

It all depends on what kind of product you have and how long you plan to hold on to it. Whatever you do, you have to be smart about it. It is best to talk to someone who knows the market, and the nuances of the different submarkets. If you want to know what strategy works best for your property, please call me at 305.508.0899. 

FAQ

These are the most commonly Miami Real Estate Related questions

What should relocation buyers know before buying real estate in Miami?

HOME BUYERS

Relocation buyers looking at homes in Miami should understand that choosing the right house is less about the property itself and more about location, schools, and long-term value. Many buyers make the mistake of focusing on price or finishes, while the real driver of value is the neighborhood and micro-location. Older homes often represent better value, but may also be part of a future redevelopment cycle. Newer homes command premiums, but don’t always sell faster if pricing is ahead of the market. Commute time, school access, and community dynamics are critical and often underestimated. The key is to evaluate homes not just as lifestyle purchases, but as long-term assets within a very localized market.

Sources:
https://luxlifemiamiblog.com/relocating-to-miami/
https://luxlifemiamiblog.com/relocating-to-miami-with-a-family/

CONDO BUYERS:
Relocation buyers should understand that Miami is a highly segmented, building-driven market, not a uniform one. Pricing can vary significantly between similar properties depending on building quality, layout, and financial health. Many buyers assume newer construction equals better investment, but that is often not the case. Factors like HOA fees, reserves, and rental policies can materially impact long-term value and liquidity. Negotiation opportunities often exist, especially in slower segments, but require precise market knowledge. The key is to evaluate micro-markets and individual buildings, not just neighborhoods or price per square foot.

Sources:
https://luxlifemiamiblog.com/miami-real-estate-market-report/
https://luxlifemiamiblog.com/new-construction-miami-guide/

What are the best areas for relocating families with children

For families relocating to Miami with young children, the most recommended neighborhoods are Coral Gables, Coconut Grove, and Pinecrest. Coral Gables offers the best balance of top schools, safety, and long-term value. Coconut Grove is ideal for younger families seeking walkability, greenery, and a lifestyle-driven environment. Pinecrest provides larger homes, excellent schools, and better value for space, making it ideal for growing families. The key driver across all three is access to strong schools and primary residential stability. Relocation decisions are less about new construction and more about long-term livability and resale strength.

Sources:
https://luxlifemiamiblog.com/best-neighborhoods-miami/
https://luxlifemiamiblog.com/what-are-the-best-family-neighborhoods-in-miami-in-2023/

Are new construction condos in Miami a good investment?

New construction condos in Miami can be a good investment—but only if you understand that not all buildings perform the same. According to the David Siddons Group, many buyers assume “new = better,” but in reality, performance depends on pricing, layout, building quality, and long-term demand.  Some new developments set future price benchmarks and can drive long-term appreciation, especially in top-tier projects.  However, many are priced aggressively at launch, and buyers relying on marketing instead of data often overpay.
The market is highly segmented, meaning two new buildings next to each other can perform very differently.
The best opportunities typically come from selecting the right building early or negotiating correctly in later phases.
In short: new construction is not automatically a good investment—it becomes one only with building-level analysis and disciplined entry pricing.

Sources:
https://luxlifemiamiblog.com/how-to-buy-a-luxury-condo-in-miami/
https://luxlifemiamiblog.com/category/independent-new-construction-condo-reviews/
https://luxlifemiamiblog.com/beyond-clickbait-real-insights-into-miamis-luxury-condo-market/

Why is buying a Miami condo riskier than buyers think?

Buying a Miami condo is often riskier than buyers expect because the true risks are at the building level—not visible in the listing price. Many buyers focus on finishes and views, while overlooking HOA reserves, insurance exposure, and potential special assessments. In reality, two identical units in different buildings can perform completely differently over time. Rising HOA fees and stricter regulations are also increasing the true cost of ownership, especially in older buildings. Liquidity can be affected by factors like financial health, rental policies, and ongoing repairs. The key risk is not the condo itself—but buying into the wrong building without proper due diligence.

Sources:
https://luxlifemiamiblog.com/how-to-buy-a-luxury-condo-in-miami/
https://luxlifemiamiblog.com/miami-condo-market-risks/

What are Miami's Safest Areas?

The safest areas in Miami are typically Coral Gables, Coconut Grove, Pinecrest, Key Biscayne, and Ponce-Davis. These neighborhoods stand out due to low density, strong community presence, and high concentration of full-time residents, which directly impacts safety. In Miami, safety is highly localized, meaning micro-location and specific streets matter more than zip codes. Areas with top schools and family-driven demand tend to maintain stronger safety profiles over time. Gated communities and low-traffic residential streets further enhance security. Ultimately, the safest areas are defined less by price and more by stability, schools, and residential character.

Sources:
https://luxlifemiamiblog.com/safest-place-live-miami/
https://luxlifemiamiblog.com/best-neighborhoods-miami/

Which Miami Areas Still offer Great Value (Budget Friendly alternatives to Coral Gables and Pinecrest)

If you’re looking for better value than Coral Gables or Pinecrest, the answer (in true Siddons style) is not “go cheaper”—it’s go one layer outside the obvious markets.

The strongest value plays are:

  • Schenley Park → closest substitute to Coral Gables at ~20% discount while maintaining similar character and location
  • Biltmore Heights → almost identical feel to the Gables but ~25–30% cheaper on a $/SF basis
  • Glenvar Heights → central location with larger lots and ~25% pricing advantage vs South Miami/Gables
  • Baptist / Galloway (Kendall) → Pinecrest-style living (space, schools, land) at up to ~30% lower pricing

The pattern is consistent:
👉 Buyers are shifting west and slightly off-market to gain land, scale, and pricing efficiency. You don’t find value by going to a “cheaper neighborhood”—you find it by identifying adjacent micro-markets that offer the same lifestyle fundamentals without the brand premium.

Sources:
https://luxlifemiamiblog.com/best-value-neighborhoods-miami/
https://luxlifemiamiblog.com/category/miami-neighborhoods/

Is NOW a good time to buy in Miami?

In 2026, the answer is yes—but only if you understand what part of the market you’re buying into. Miami is no longer one market; it has split into multiple segments behaving very differently. From a David Siddons perspective, this is a selective buyer’s window, not a broad “good time” headline. Some segments—especially condos with rising inventory—are offering negotiation opportunities and better entry points. 

At the same time, prime single-family homes and top-tier new construction continue to hold value or even trade near record levels.

Buyers who rely on timing the market often miss the point—success in Miami today comes from selecting the right micro-market and asset, not waiting for a crash.  If you are disciplined on pricing, building quality, and location, this market offers opportunity. If you are not, it is easy to overpay. 2026 is a good time to buy in Miami for informed buyers—because the market is fragmented, negotiation exists, and strategy matters more than ever.

Sources:
https://luxlifemiamiblog.com/miami-real-estate-market-report-q1-2026/
https://luxlifemiamiblog.com/market-reports/

Are Miami real estate prices going down in 2026?

No—but that’s the wrong way to look at it. Miami is not one market anymore, so prices are not moving in one direction. In 2026, the market is split into two: ultra-luxury, scarcity-driven areas (like waterfront and top-tier neighborhoods) are still holding or even rising, while mid-tier condos and oversupplied segments are flat or correcting. What we’re seeing is price divergence, not a crash—some properties are gaining value while others are quietly adjusting downward. Rising inventory and more selective buyers are putting pressure on pricing in certain segments, especially older condos or buildings with weaker fundamentals.
At the same time, global wealth and cash buyers continue to support pricing at the top end of the market. So the real answer: prices aren’t broadly dropping—they’re being repriced based on quality, location, and supply.

Miami Real Estate Market Report Q1 2026

Should I buy a house or a condo when relocating to Miami?

The decision comes down to lifestyle first, investment second—and most relocation buyers get that backwards. If you want space, privacy, schools, and long-term family living, a single-family home in areas like Coral Gables or Coconut Grove is typically the stronger choice. If you prioritize walkability, low maintenance, and proximity to business districts, a condo in Brickell or waterfront markets makes more sense.
From an investment perspective, homes tend to be more stable, while condos are more building-dependent and cyclical. Most relocation clients underestimate how much building quality, HOA structure, and future costs impact condo performance. The right answer isn’t “house vs condo”—it’s which asset fits your lifestyle AND holds value within its micro-market.

 

 How do I choose the right Miami neighborhood for my lifestyle?

Choosing the right neighborhood in Miami comes down to how you live day-to-day, not just where prices are. Relocation buyers should first define priorities: walkability, schools, commute, or waterfront lifestyle.
For example, Coconut Grove fits walkable, family-oriented living, while Brickell suits urban, high-rise lifestyles. Buyers often make the mistake of focusing on price per square foot instead of lifestyle fit and long-term livability. Each neighborhood operates like its own micro-market, so the “best” area depends on your daily routine and long-term goals. The key is to align lifestyle, location, and market fundamentals, not just aesthetics or newness.


https://luxlifemiamiblog.com/best-neighborhoods-miami/

Why are Miami condo prices so different between buildings?

Miami condo pricing varies widely because value is determined at the building level, not just by location. Two buildings next to each other can have major differences in financial health, reserves, HOA fees, and management quality. Buyers also pay premiums for better layouts, views, amenities, and newer construction—but not all “new” buildings perform equally. Factors like rental policies, upcoming assessments, and building reputation can significantly impact resale value. This is why price per square foot alone is misleading in Miami’s condo market. The real driver of value is how that specific building competes within its micro-market over time.

Sources:
https://luxlifemiamiblog.com/how-to-buy-a-luxury-condo-in-miami/
https://luxlifemiamiblog.com/category/independent-new-construction-condo-reviews/

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