Brokers optimistic as Miami's housing glut melts away
Leaders of some of Miami-Dade's larger realty brokerages say that based
on last year's performance and record-breaking levels of investor
interest in the area, they're feeling optimistic about the future of the
local residential market.
"I
think we are on the verge of another boom," said Patricia Delinois,
incoming president of Miami Realtor Association and president & CEO
of Century 21 Premier Elite Realty. She cited National Association of
Realtor Chief Economist Lawrence Yun's prediction of dramatic increases
in sales in 2012.
"Sales
prices per square foot are up; the luxury market is doing well;
distressed sales are down from 2010; we're seeing sharp increases in the
numbers of second-home buyers, especially in Miami Beach and South
Beach, and the numbers of first-time buyers converting from renting is
astounding," said Vanessa Grout, president and CEO of Douglas Elliman
Florida. "All of that is very positive."
"We
have been through one of the longest low cycles in South Florida's
history, and the biggest high cycle just before it," said Mike Pappas,
president and CEO of The Keyes Co., which closed on 20% more units in
2011 than in 2010.
Ron
Shuffield, president of Esslinger Wooten Maxwell Realtors, said the
28,277 properties sold countywide in 2011 represents an 18% increase
over 2010 sales and is the highest number reported since records have
been kept.
The
market has still not recovered from the dramatic price hit it took in
2008, Mr. Pappas said, but "we are eating through the inventory at a lot
higher rate than anyone expected. There's a fire sale in South Florida
real estate, and the world market is coming here bringing global cash.
"I
believe the foundation has been laid for a new strong real-estate
cycle. We are budgeting a 10% increase over last year in number of units
sold."
Pricing
increases, Mr. Pappas said, will depend upon getting through whatever
inventory of distressed properties remains unreleased by lenders.
According
to the Clear Capital Home Data Index Market Report, Miami's annual
price gain of 5.6% in 2011 was the third highest in the nation, which
correlates to its position as the market with the third-strongest
decrease in REOs, or distressed properties. Clear Capital's economists
predict Miami will be among the five highest performing metro areas in
2012, with an estimated 7.4% growth.
Right
now, Mr. Shuffield said, there's a problem no one expected to see so
soon: inventory unequal to demand. When the market faltered in 2008,
there were 42,000 homes on the market locally. At the end of December
2010, there were 23,272 listings. Now, there are only 14,129.
"The challenge we're going to have this year," he said, "is getting more inventory."
"We're starting to have to push to get listings," Ms. Delinois said.
In
2011, 55% of all home sales were foreclosures or short sales, Mr.
Shuffield said, down from two-thirds of all sales in 2010. That has
resulted in some positive price adjustment, "but it's very
building-specific and area-specific. Waterfront and Brickell properties
are seeing solid increases, but outlying areas don't appeal as much to
international buyers, so they're lagging behind."
Low inventories have sparked a small flurry of new project announcements.
One
Sotheby's International Realty, which reported a growth of more than
250% in sales in 2011, opened new offices over the past year in Key
Biscayne, Coral Gables, Fort Lauderdale, Miami Beach, Aventura and South
Beach-South of Fifth.
Source: MiamiTodayNews.com