- Brought to you by the Miami Association of Realtors
Nothing—not even a global pandemic—seems to be able to slow down South Florida’s booming real estate market. We spoke with three of the region’s top real estate experts about the current state of the market and their predictions for the future.
Christopher Zoller, a broker associate with Berkshire Hathaway Home Services EWM Realty since 1990, specializes in custom luxury properties for commercial and residential clients. He is also director of the National, Florida and Miami Associations of Realtors and is active in Coral Gables Citizen Advisory Boards.
How would you characterize the current state of Miami real estate? The market is very strong—stronger than before COVID and stronger than a year ago. There is increased activity in almost all price ranges, and new pending sales (the best indicator of future closed sales) are surging.
Has the pandemic had a noticeable effect on Miami real estate? It seems that we are busier now than we were during the first two months of the year! The most desired homes are in residential areas with updated or new construction that have spacious private yards and amenities.
What have been some trends in the luxury market over the last six months? Pending sales for properties $1 million and above increased 70% from March to June 2020 and 46% compared to June 2019. Meanwhile, supply of luxury properties is declining: From the peak in May (45.5 months) to June 2020 (37.4 months), supply decreased 17.8%.
There are still buying opportunities in the sweet spots of $2 million to $5 million, where supply for single-family homes dropped from 65 months in April to 17.8 months at the end of June. The median sale price increased by more than 13% to $3.5 million.
The most notable trend is the uptick in sales of uber-luxury homes (over $10 million). The condo market has been a little softer, probably due to the desire for social distancing.
What are your predictions for the next six to 12 months? When sellers get more comfortable with the new ways we are showing and selling homes, I foresee an increase in inventory, which will meet the increased demand. More inventory will also bring some beneficial price adjustments.
Are you seeing a difference in local vs. out-of-state buyers? There is a desire from out-of-state buyers to get out of dense cities. This is on top of buyers who have been coming here for years to avoid high-tax states and enjoy our weather, amenities and global climate.
What are some popular neighborhoods right now? Coral Gables, Coconut Grove, Miami Beach, Pinecrest and Ponce-Davis are getting a lot of activity. As the workforce becomes accustomed to more remote opportunities, commuting will not be as important a factor.
Tips for buyers/sellers? Sellers with updated houses at the right price point in the right location have a huge opportunity. Buyers need to get pre-approved (not just pre-qualified) for low-interest mortgages and bring approval letters with their offers.
What’s a common mistake buyers/sellers make? The biggest mistake sellers make is overestimating the value of their homes and not reacting to the teachings of the market. Buyers need to look and react quickly. Several buyers interested in my listings came in too late.
Jonathan Keith is a 20-year real estate veteran and principal of Fort Lauderdale’s Team JK, which specializes in luxury waterfront residences. He was named one of the Top 100 Realtors in Florida and recognized by the Miami Association of Realtors in 2014 and 2016 with the Broward County Champion Award. He also served as the organization’s 2019 Broward president.
How would you characterize the current state of Broward real estate? Like most of South Florida, Broward is performing robustly. Before COVID, the market was already strong, reflecting high demand and limited supply. Following a brief interruption, the market has come back even stronger. Pending sales are surging, and supply is declining further.
Has the pandemic had a noticeable effect on Broward real estate? While there have been changes in the way we do business, the biggest change is the increased activity. Despite stay-at-home orders, sales in March 2020 surpassed March 2019. Realtors kept serving clients while transitioning to remote operations and leveraging virtual resources.
What have been some trends in the luxury market over the last six months? Broward’s luxury market has seen increased interest over the last few years, particularly for single-family homes and waterfront properties. The pandemic has further accelerated this trend. Pending luxury sales in June 2020 spiked 67.2% compared to June 2019 and were 210% higher than when they bottomed in April. Closed luxury sales increased 21.3% in June compared to a year earlier and 47% compared to April of this year. Closed sales began to rise month-over-month in May and are on course to surpass activity in 2019. While demand is increasing, inventory is mostly declining. In June 2020, active luxury inventory declined 12.3% compared to June 2019.
What are your predictions for the next six to 12 months? Limited supply and increased demand will continue to drive price appreciation in the luxury segment. Low interest rates and demand from high earners in high-tax, high-density areas will continue to drive demand.
Are you seeing a difference in local vs. out-of-state buyers? The market was already attracting affluent buyers from New York and other tax-burdened areas. The ability to work remotely is further prompting these buyers to take advantage of our competitive luxury market, moderate weather and enviable lifestyle.
What are some popular neighborhoods right now? Plantation and Coral Springs are two hot markets where buyers can get larger homes with luxurious amenities at affordable prices.
Tips for buyers/sellers? Work with a Realtor who can access resources to analyze property details, including comparable closed sales, market metrics and supply vs. demand.
What’s a common mistake buyers/sellers make? It’s important for buyers to have extensive inspections, including pipes, pools and sea walls. Sellers should price their properties correctly from the start or they risk losing interest from prospective buyers, having to reduce the price and receiving lower offers than if they’d priced right initially.
David Abernathy is the business manager at Waterfront Properties, the leading purveyor of luxury real estate in northern Palm Beach and Martin counties. He is also the Miami Association of Realtors’ 2020 Jupiter-Tequesta-Hobe Sound president and is frequently sought out as a source for Palm Beach County real estate market statistics.
How would you characterize the current state of Palm Beach real estate? We have been experiencing a very strong luxury market since mid-April. The $5 million-plus markets in Palm Beach Island, Jupiter and Jupiter Island are all up over 50% compared to 2019, and sales for the $1 million-plus markets are back to being stronger than 2019.
Has the pandemic had a noticeable effect on Palm Beach real estate? 2020 started strong both in the number of transactions and sales prices. By mid-March, the market slowed to where the number of properties under contract was less than 50% of 2019. Fortunately, by mid-April, the market was gaining traction, and by mid-May, the number of transactions was exceeding 2019 sales. June was a record-setting month, but in July, it started to slow again, possibly due to an increase in COVID cases.
What have been some trends in the luxury market over the last six months? Perhaps the most apparent trend is the difference in how the single-family-home market has recovered vs. the condo market. During the lockdown, condo associations were quick to implement measures restricting showings. This led the condo market to be more negativity impacted.
What are your predictions for the next six to 12 months? My best guess is that Palm Beach County’s real estate market will stay on a steady path through the election in November.
Are you seeing a difference in local vs. out-of-state buyers? In the early days of COVID, many seasonal visitors from the Northeast extended their stays. By late April and May, many renters turned into buyers and seasonal residents purchased larger properties to stay in Florida year-round.
What are some popular neighborhoods right now? Since there is a limited number of waterfront homes and condos, these property values tend to increase in good markets and retain value better in down periods. Palm Beach Island, Admirals Cove and Jupiter Island provide low density with a strong luxury lifestyle.
Tips for buyers/sellers? Uncertainty creates big opportunities for buyers. If a property owner is thinking of selling, we encourage them to take advantage of our strong market.
What’s a common mistake buyers/sellers make? People often make assumptions about our market based on what they hear in the news. In the early days of COVID, Northeast buyers assumed prices were falling in our area because of what was happening where they live. This wasn’t the case for most of Palm Beach County.