Coconut Grove and Coral Gables $4m Homes – The Hardest Market to Satisfy!

We consistently get the highest number of enquiries for single family homes in Coconut Grove and Coral Gables, around the $4M mark. Registrations come in almost daily, many from local buyers looking to “move up,” alongside a steady stream from relocating buyers. Both groups, it turns out, have usually been searching for a while. Most who register tell us exactly what they want: “Looking for a 4-bedroom home in Coconut Grove or Coral Gables. Close to the schools, ideally with a good sized yard and a pool. New or newer would be great too.“

Does this sound like you?  Well, you’re not alone. But there is a problem that is often not explained and until it is, these buyers will remain ‘on the fence’ looking for that ideal home but ultimately end up VERY VERY FRUSTRATED. So let me explain.

If we look for a 4–5-bedroom home in Coconut Grove or Coral Gables (East of US1) today we have 88 options. Sounds good. But… If we reduce the budget to $3.5-$4.5m we only get 10. Reduce it to homes built in the last 10 years and this comes down to 2 options. In the last 360 days (1year) we saw only 1 legitimate sale of a 4-5 bed, newer home sell in the Grove for less than $4m! (2851 W Trade Ave). And what about Coral Gables? It’s even worse. Right now there are zero 4-5 bedroom homes available around $4M and built in the last 10 years. And in the past year, not a single one sold. Let’s dig deeper. What did sell, then? What sold around $4M in the Grove or the Gables?

Coral Gables Observations

Coral Gables has a lot of older homes, some dating back to the 1920s, but that’s not a bad thing. Of course, the lifestyle and floor plan functionality were quite different back then. Grand living spaces were common, but so were small bedrooms and tiny closets. If you can forgive the small closets (or find ways to combine bedrooms), a home dating back 100 years can feel quite grand. 1033 Hardee and 2010 N Greenway are good examples.

The West side of US1 will give you so much more bang for your buck AND is equally if not prettier than the East side of US1. The big motivating factor and cost for high costs east of US1 is in fact the proximity to the most well know private schools: Ranson, Carollton, Gulliver. Spend a little more, get a lot more. Push above $4M and options really open up, and if a more modern home is the goal, that’s what it will take. $4M isn’t the budget it was two years ago. Coconut Grove and Coral Gables are some of Miami’s most aggressively appreciating markets, and despite how much they’ve already appreciated, they’re still moving. A well remodeled 50s to 80s home can have far more interesting architectural features than a newer build, and if done right, can be just as good (as long as the roof and windows are hurricane proof). Example: 6811 Riviera Dr.

The Explanation: Why is this happening?

For the Grove: three years ago, homes were trading around $1,200 per sqft. Today, homes in the Grove are selling for $1,600 per sqft or more. Go back further, and the price per sqft was half of what it is today. A good example is 3470 Poinciana, which traded at $3.8M in 2020 and sold again this January at $7.6M. Coral Gables tells the same story.

Migration of families from across America (California, NYC or Washington) were not isolated to the pandemic period. They continued and even accelerated as big business (hedge funds) continue to flood into Miami. The proximity to Miami’s commercial centers of Brickell and Coral Gables are one factor, but the access to the best private schools dwarf everything else. These neighborhoods have appreciated more after the pandemic that during, and today that trend continues – and will continue for the foreseeable future.

Many buyers still act like it’s 2023 and haven’t caught up with the “secret” appreciation that’s happened while they weren’t watching. A 3,500 sqft home they could have bought three years ago for $1,200 per sqft ($4.2M) now sells closer to $1,600 per sqft, pushing that same home to around $5.5M. Simply put, many buyers are searching for the perfect home on a budget that no longer matches the market, what we call “champagne taste and beer money.” It’s not their fault. No one explained the realities of a rapidly changing market to them.

The Solution

1. Increase budget – Simply put, you need to adjust your budget up to get the home you want. A newer home will put you around $5.5m or more.
2. Open your geography – So you wanted East of Us1. It’s ok, to go West of US1 to the north part of Coral Gables. These are beautiful streets and an extra 5 min commute to school or the office is not going to kill you. South Miami and Glenvar Heights are areas coming up fast. They border to Coral Gables and the Grove and are just as good in many regards.
3. Go for an older home – You can consider an older home which has been renovated and, in some cases, consider a home that you can put work into. The investment will be worth it and will provide excellent appreciation.
4. Let’s go off market! We do around 35% of our business off market. With that said this does not mean you can get that dream home at 70c on the dollar. You just get a head start on the best homes.

Keep looking for the “ideal” home while sticking to your budget, and you’ll keep getting the same result. Doing the same thing and expecting a different outcome is the definition of insanity. Year after year, I see buyers show up at open houses looking for that ideal home: seemingly smart, successful people armed with nothing more than stubbornness, an ego, and the misplaced belief that the market “will correct” because they work in finance and know better than everyone else. They think they’ll get the home they want if they just keep looking hard enough.

These are the buyers I refuse to work with. They don’t actually analyze anything properly, yet somehow consider themselves experts. That house you like at $5M but only want to pay $4M for will be $5.5M next year, and $6M the year after. You will never get a home unless you seriously consider one of your first three choices. Sorry if that shatters your ego. I don’t care. Sack up.

For everyone else, let’s chat.

Your Next Move Starts With the Right Numbers

The market isn’t waiting for anyone to catch up, and it won’t correct just because you’re ready for it to. If you want a shot at the home you actually want, in the Grove, the Gables, or one of the up and coming neighborhoods right next door, you need real numbers, not last year’s expectations.  Let’s map out exactly what your budget buys today, and where it buys the most.

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