Miami Real Estate Shows Signs of Panicky Buying (Yes, Buying) in December 2009

posted on January 26th, 2010 filed under: Real Estate News

Miami homebuyers jumped at anything with a “For Sale” sign in front of it in December 2009, contradicting a slackened pace of sales nationally.

According to the Florida Association of Realtors, sales of single-family homes in the Miami metropolitan statistical area (MSA) rocketed from 455 in November to 623 in December — an increase of 37% in one month.  (Coral Gables may not have shared in the feeding frenzy — see Coral Gables Single-Family Home Sales Running Flat Year-Over-Year?)

The median price in the Miami MSA likewise jumped higher, from $184,800 in November to $204,300 in December — a 10.5% gain in one month.

To keep the price data in perspective, the bubble-high median price was $401,100 in May 2007.  And the median price has bounced around a lot since hitting a low of $177,000 in April 2009.  Nevertheless, it’s the first month over $200,000 since that low point.

The story nationwide was different, with sales down sharply and prices up significantly.  According to the National Association of Realtors, single-family home sales fell from a 6,540,000 seasonally adjusted annual rate in November to 5,450,000 in December — a 16.7% decline.  The median price, however, rose from $170,000 in November to $178,000 in December — a 4.7% increase.

The slackened sales pace nationally is generally believed to have resulted from the originally scheduled expiration of the $8,000 homebuyer tax credit at the end of November 2009 (since extended to the end of April 2010).  The credit has the most impact at the lower end, so its anticipated expiration spurred a lot of low-end deals to close by the end of November, resulting in a reversion to a higher-priced mix of homes in December.

But Miami saw big gains in both sales and the median price.  Is the bottom in?  Or is the elixir of artificially low interest rates and other government inducements leading a new herd of buyers into the same slaughterhouse that just decimated so many others lured by cheap money and rising prices?

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posted by // This entry was posted on Tuesday, January 26th, 2010 at 12:18 pm and is filed under Real Estate News. You can follow any responses to this entry through the RSS 2.0 feed.

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