The Pinecrest Real Estate Market Forecast | Miami Real Estate Market Predictions for 2023

Introduction to the Pinecrest Real Estate Market Forecast

The Pinecrest housing market is another true primary market. A place where there are few rentals and residents live all year round. Much like Coral Gables and Coconut Grove, families with kids dominate the purchasing landscape. Going into 2023 we noticed that the South part of Pinecrest (below 120th) is softening, especially in the $4M-$5M range. As this budget also opens itself against the Coral Gables market. $4M will give you a much larger home in Pinecrest than in Coral Gables, with buyers willing to compromise on centrality for a larger home and a larger lot (15K++). The Pinecrest area is relatively insulated because of the school district, but some submarkets will do better than others. Older homes will be harder to sell in 2023 unless priced correctly. Due to long waiting times and construction costs, buyers are less eager to engage in full renovations. There is an unsurprisingly higher desire for brand-new luxury construction homes. However, never before have we had so many $10M+ homes for sale. Developers recognized the continued migration of the ‘Top 1%’ from across the US looking to relocate to Miami and particularly those with kids for middle and high school and have met the demand by building these. Expect to see even more of these enter the market through 2023!

5 Observations

• Older home sales are slowing down.  In Q3 and Q4 of 2022, older homes (2000 or before) experienced a slowdown in sales. Newer homes were selling, but that market dried up so quickly that sales slowed down, due to a lack of inventory.
• Lots of New Construction going on.  There is still lots of new construction going on and Pinecrest is a hotbed for new development. With buyers looking mostly at newer homes, the area’s large lots and (still) high concentration of older homes make it a focal point for developers. The sale of these new homes pushes the average price per sqft up in the neighborhood, but this can potentially give a sense of misdirection as older homes won’t see their numbers rise.
• Large waiting lists for surrounding schools. In 2022 the rate of applications doubled compared to previous years. With long waiting lists for schools, we know the demand for homes in the area will not go down any time soon. For more info, watch our podcast with Palmer Trinity and St Thomas admission officers.
• The rise of top-echelon homes. We have noticed a rise in the sales of very expensive properties. Up till 2020, the top end of the market used to be around $7M, now the ceiling has changed to $9M or even $10M. While an acre of lot traded for $1.5M before the pandemic, it is now trading for $2.3M. The dollar per SF record is just $1,000 per SF, which is still not ridiculously high. The number of homes selling over $1,000 per SF also skyrocketed in 2022. There are currently eight homes for sale in the $10M+ range.
• More New Construction and a Higher Price One-third of the current inventory above $2M, is a newer construction home from 2015 or later. There is more new construction than ever before and a better level of construction than we have previously seen, which is allowing for the ‘acheivable’ $ per sqft to also go up. The prices are also at a level we have historically not experienced. On the surface it appears that there is an excess supply of homes over $10m, which at 21 month would suggest to be true. However, with closer inspection we can see that previous sales have been limited and much of the new product has not been finished yet. I predict this number will fall as these sales occur over the coming months.

Comments for Buyers

The inventory in Pinecrest is still relatively stable (the balance between buyers and sellers is not excessively high or excessively low. In some sectors however, like new homes under $10m it is quite low. If you are looking for a newer home in a primary market, this neighborhood will provide a good amount of choice relative to Coconut Grove or Coral Gables where it is almost zero! You might want to check in with me as I’m always in contact with developers. It is financially always better to get in early and be more involved in the customization. Please check my article on the advantage of buying a new construction home in the early stages.

Comments for Sellers

IIf you are selling your Pinecrest home, make sure it is priced according to its submarket value. This is no longer a market to test the waters. In the case of a new construction or very well-finished homes, you are still likely to receive top dollar. Older and unimproved homes are most likely to sit on the market for the longest time, if not priced correctly. As mentioned before the $4M+ range competes with the Gables market, especially when it is not a brand-new home. It, therefore, needs to be well-priced.

We notice with Pinecrest that, unlike some other neighborhoods, this has a much large base of buyers coming from within Miami. Pinecrest is a natural progressive choice for existing families (particularly those with kids in middle and high school) looking to upgrade to bigger homes on bigger lots at more affordable prices. In fact, we have seen a number of home buyers sell their Grove or Gables property and move South to Pinecrest to experience a shorter commute to the schools, and gain a bigger home and bigger lot AT THE SAME PRICE as the last home. Knowing how to market to these people is all important. Please call me for more information on this.

Conclusions for the Pinecrest Real Estate Market Forecast

Most of the Pinecrest price point submarkets are still going to sustain their price per sqft well into 2023. This is thanks to its primary nature of serving those who need exceptional public and private schools. We do not expect these numbers however to significantly trend upwards. In 2022, the number of private school applications skyrocketed, and the attrition rate reached a new low, signaling an increase in people moving to Miami and a decline in those who want to leave. This bodes well for a strong and steady market in the years to come. Pinecrest still tracks well in front of other primary neighborhoods such as Grove and the Gables for affordability and the introduction of a new breed of ultra-luxurious and expensive $ per sqft homes will push the ceiling of this market up.