Q2 Review: Closed Sales in Miami and Coral Gables Real Estate, Zip Code 33134

posted on September 24th, 2010 filed under: Properties in Focus, Real Estate Market Data

Closed sales data are key to understanding current conditions in the real estate market.  Although broad indices like the FHFA House Price Index or the S&P Case-Shiller Home Price Index break down the numbers by metro areas, including Miami, real estate values can be highly localized.

The table below reports closed sales of single-family houses in zip code 33134, which is mainly within Coral Gables.  Because The Real Estate Fountain focuses on mid-range to luxury properties, the table generally excludes sales of small homes on small lots, like the many bungalows found in north Coral Gables.

Coral Gables Real Estate -- Closed Sales -- Single-Family Homes -- Zip Code 33134 -- 2Q10Data are from tax records, and thus include transactions both on and off the MLS.

816 Castile Ave.

816 Castile Ave.

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Friday Fountain Photo

posted on September 17th, 2010 filed under: Fountains

Wall fountain and reflecting pool at Columbus Center, 1 Alhambra Plaza, Coral Gables.

Coral Gables Real Estate Photos -- Fountain -- Columbus Center -- 1 Alhambra Plaza

The entire 60,000-sf west wing of Columbus Center is available for lease, with the ideal candidate being a single tenant who will make it a headquarters location.  Space is also available in the taller 200,000-sf east tower.

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Rentals May Have Peaked for Miami and Coral Gables Single-Family Real Estate

posted on September 17th, 2010 filed under: Financial Responsibility, Real Estate Market Data

At the top of the market, you were a putz if you didn’t own a home — and preferably more than one.  Renters were losers.

Well, the worm certainly turned, eh?

In Miami and Coral Gables, renting a home shot up in popularity as it dawned on people that it’s better to pay half the cost of ownership and skip the massive capital losses.  Why buy a depreciating asset with borrowed money, especially when you can rent it for half the cost?  Certainly the advice you got here was to rent, not buy.

Alas, home ownership is a relentless lure, and the stabilization in home prices in Miami and Coral Gables appears to have turned the tide from real estate rentals back toward real estate sales.  This is true across the board for single-family homes: in Coral Gables as well as Miami-Dade County, and for larger homes (4 bedrooms or more) as well as the entire market.

Rented Versus Sold Single-Family Homes Coral Gables and Miami

The number of rentals appears to have peaked in 2009, as the pace in 2010 is running behind the pace of last year’s high.

Rentals Closed -- Single-Family Homes -- Miami and Coral GablesIn Coral Gables, rentals went from barely more than 10% of real estate transactions to nearly 50% of real estate transactions.  Considering that real estate agents make about 90% less on rentals than sales, you can assume a lot of people found themselves with essentially no income.

Rentals Versus Sales Closed -- Single-Family Homes -- Coral GablesSame story in Miami as a whole:

Rentals Versus Sales Closed -- Single-Family Homes -- MiamiData are from MLS and therefore do not account for sales outside MLS.

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Friday Fountain Photo

posted on September 10th, 2010 filed under: Fountains

Photo of fountain in the courtyard of Fontana, one of several restaurants at the Biltmore Hotel in Coral Gables.  There’s a reason it’s called Fontana.

Coral Gables Real Estate Photos -- Fountain at Fontana Restaurant, Biltmore Hotel -- 2

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No Money Down Government Loans Spark Debate. (Tiny Bit Down Loans Don’t.)

posted on September 10th, 2010 filed under: Financial Responsibility, Real Estate News

No money down loans from the government for homebuyers. Makes for a sensational story, but keep in mind that standard FHA loans require only a 3.5% downpayment.

At present, the no money down program is available in only four states, not including Florida. So anyone looking to buy real estate in Miami or Coral Gables will have to come up with the usual 3.5% if they want an FHA loan.

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Property at 3717 Toledo St. in Coral Gables Sells for $850,000

posted on September 9th, 2010 filed under: Properties in Focus

A previous post discussed the firm demand for real estate in the Golden Triangle neighborhood near the Biltmore Hotel in Coral Gables, and cited as an example the possible sale of the house at 3717 Toledo Street in Coral Gables.  The sellers wanted no less than $850,000, and it seemed like they might have gotten it.

Indeed, they did.  Sold for $850,000.  That’s not cheap, when you consider that even the sales pitch conceded that this well-worn Coral Gables home needed at least $250,000 of work.  But at $248/sf before renovation or $320/sf after renovation, the price is in line with the market for sub-luxury professional homes in Coral Gables.

3717 Toledo St.

3717 Toledo St.

Upper-middle-bracket buyers continue to face meaningful competition from one another in the quest for a decent home in the Miami area.  The desire for a signature older home instead of a cookie-cutter South Florida ranch is a principal attraction of Coral Gables.  Make no mistake — the bulk of the housing stock in Coral Gables consists of undistinguished cookie-cutter ranches.  But at least Coral Gables has a decent selection of older homes as well.  If you’re trying to rise above the vast architectural wasteland that is South Florida, you don’t have many alternatives.

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Friday Fountain Photo

posted on September 3rd, 2010 filed under: Fountains

Photo of fountain at Isola, a 31-story, 130-unit condominium at 770 Claughton Island Drive, on Brickell Key in downtown Miami.  Isola was built in 1990.

Miami Real Estate Photos -- Isola Condo -- Fountain

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Months’ Supply of Homes in Coral Gables (Part 2) — Luxury Still in a Rut

posted on September 3rd, 2010 filed under: Real Estate Market Data

As the preceding post explained, the months’ supply of homes for sale is an important market barometer.  But the data for the market as a whole may not be all that revealing about the market segment relevant to you.

Vast oversupply continues to plague the market for luxury homes in Coral Gables.  The disparity between the tremendous oversupply in the luxury segment and the merely big oversupply in the broader market has been noted here for quite a while.  Luxury-home prices in Coral Gables have already fallen sharply, yet the continuing extreme oversupply points to significant further price declines.

There are currently 177 single-family homes listed for sale above $1.5 million in Coral Gables.  The number sold in the past month: 6.  That’s about a 30-month supply.

For Miami-Dade County as a whole, there are 864 homes for sale above $1.5 million.  The number sold last month: 21.  A 41-month supply.

The months’ supply normally runs higher in the luxury-home segment than in the broader real estate market.  But if the norm in the broader market is 6 to 8 months’ supply, the norm in the luxury-home segment is about 10 to 12 months.  It is still very much a buyer’s market.

Forecast: a steady downpour of falling prices in the luxury-home market in Coral Gables and Miami.

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Months’ Supply of Homes in Coral Gables (Part 1) — Going Steady

posted on September 3rd, 2010 filed under: Real Estate Market Data

An important measure of supply and demand is the months’ supply of homes on the market — i.e., the number of homes currently for sale divided by the number that sold over the past month.

Months' SupplyThink of it as the number of months it would take to sell off all the homes currently on the market, if sales continued at their current pace.  (Of course, that never actually happens, because new listings are always showing up to replace the ones that are sold.)

The months’ supply figure is an important barometer of supply and demand.  A supply of 6 to 8 months’ worth of homes on the market is generally associated with an even balance of power in the real estate market, so neither buyers nor sellers have the upper hand.  Going much above that range makes it a buyer’s market (more homes than buyers = too much supply = falling prices), and going below that range makes it a seller’s market (more buyers than homes = too much demand = rising prices).

Coral Gables Real Estate Photos -- Country Club Prado 2

For the real estate market in Coral Gables, the months’ supply of single-family homes now stands at about 14.  That’s rather high, but it got up to about 40 or 50 at one point — perhaps unprecedented, although the collapse of the 1920s bubble might have yielded similar figures.  In contrast, at the peak in 2005-06 the months’ supply dwindled to about 3.

For the real estate market in Miami-Dade County, the months’ supply of single-family homes stands at about 11.5.  As with Coral Gables, that figure is way down from its peak, but still indicative of a buyer’s market.

And although the months’ supply of homes for sale in Coral Gables and greater Miami is way down from its peak, most of the decline occurred back in the middle of 2009.  Little further progress has been made toward working off the excess inventory over the course of this year.  The months’ supply has been holding fairly steady.  And by traditional standards, the number remains high, which should continue to exert downward pressure on prices.

Not that you should pass up the home of your dreams if it comes along.  Even if you can squeeze another 10% or 15% out of the market collapse, the house you really want is not likely to be on the market at that point.  So if you’re in it for the long haul and find the right home at a price commensurate with its historical value, buying is defensible.  On the other hand, don’t feel pressured to act precipitously.  The market is not cheap relative to the fundamentals: incomes, historical values, rents and today’s topic, supply.  And we are not going back to easy lending anytime soon.  The chance of a surge in prices appears remote.

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Friday Fountain Photo

posted on August 27th, 2010 filed under: Fountains

Fountain at Miracle Mile Entrance to downtown Coral Gables, dedicated April 1997 by the Coral Gables Garden Club.  Located at intersection of Miracle Mile and Douglas Road.

Coral Gables Real Estate Photos -- Fountain -- Miracle Mile Entrance (2)

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