The Excellent Performance of Miami Homes in the Primary Residential Markets

Why Homes in Miami’s Primary Residential markets Have Performed so Well In the Last 10 Years?

Miami’s single family home market has performed very well over the last 10 years. In this blog we show you the performance of Miami’s main residential markets and we explain why the single-family home market in these neighborhoods has performed so well. When we refer to Miami’s main residential markets we refer to Coral Gables, Coconut Grove, Pinecrest, South Miami, High Pines and Ponce Davis. These are Miami’s most desired areas for single-family homes and preferred with families relocating to Miami. Although these are separate areas we refer to them as Miami’s core for single-family home living. If you are looking for a safe neighborhood with high-end real estate close to the city’s best schools this is the area to be and therefore we often refer to this area at the “Prime Residential Market”.  As always we divided the market into different price ranges.

Why have these Miami Homes performed so well?

First and foremost single-family homes are a necessity purchase, which makes it a market that will always be in demand. Buyers, which are mostly families, need to find a home for their family and will not sell this home at the first signs of economic hardship, something we often see in purely investor-driven markets. Miami’s primary markets are very much in demand with local and relocating families as they are close to Miami’s best private schools. Families want to be close to their children’s schools and therefore prefer the Gables, The Grove, Pinecrest or South Miami. These areas are also very much in demand because they are safe, offer many gated communities and superb waterfront homes. Besides the local demand for homes in Miami’s prime areas, Miami has established itself as a true global city and a new mecca for the ultra wealthy. As of 2020, Miami is seeing a very high amount of domestic relocations from the high-tax states (New York, New Jersey, California). While Miami was already experiencing a high demand for single-family homes due to tax relocations, Covid-19 accelerated this movement and led to a crazy amount of relocations into Miami, quickly drying up inventory. In the below graphs you will see that each market saw a massive jump in sales in 2020 resulting in low inventory levels. These days prices are rising at a much quicker rate than previously seen and those who cannot find what they are looking for buy land or a dated home to make it their own, which in turn will lift the overall quality of this market. This market will continue to increase in value as long as there is demand and we do not expect this demand to slow down any time soon. Local families keep preferring these areas to raise a family and relocation buyers keep flocking into our city.

Search Directly for Miami Homes in the Primary Residential Markets

$1M-$2M Miami Homes in the Primary Residential Markets

The $1M -$2M market has experienced a very strong decade with prices per SF increasing from the low $300’s to the mid $400’s and sales numbers that have doubled or even tripled. The market shows steady and healthy inventory levels, which have decreased significantly since the second half of 2020. The marketing time of a property (days on market) also saw a decrease in the second half of 2020. While the beginning of 2020 had all the signs of a slow year, in June the market picked up and made a 180-degree turn with increased sales, fast marketing times and low inventory levels.

$2M-$3M Homes

This market shows a steady increase in prices and sales volume. Inventory levels have decreased significantly since the start of the last decade with a relatively stable last few years. As with all the markets the start of 2021 is showing a record low in the months of inventory, as the demand is extremely high and inventory has dried up.

$3M-$5M Homes 

The prices per SF in Miami’s prime residential markets have steadily increased over the last 10 years. We can also see that sales have increased since 2010 with 2021 having a very strong first quarter.
Although at first sight the days on market seem stable, adding a trend line (not shown in the graph) reveals that marketing times have decreased significantly (almost 2 months faster) since 2010.
Finally the graph shows a steadily decreasing inventory that matches the increase in demand and sales we have experienced in this market. Although 2020 shows the same inventory as in previous years, it has to be mentioned that 2020 had a relatively slow start due to Covid-19. In June 2020 the market picked up and from that moment onwards inventory started to drop with the last 6 months of 2020 showing an average of just 11 months of inventory.

$5M-$10M 

As more and more luxury homes were built the amount of sales in this market increased in the last decade with 2020 showing a record amount of sales. While inventory increased over the last few years it was absorbed by Miami’s luxury buyers in 2020 and 2021. We can see that luxury homes are selling faster these days as eager relocation buyers are looking for turn-key luxury homes. Prices have increased significantly from $750 per SF to around $1,000 per SF.

We have not reported on the $10M+ market, as the sales volume is too low in certain years and analysis will have to be done on a case-by-case basis. Please contact David Siddons for more information on the $10M+ market and its performance in the last decade.