Dip In Home Sales Hurricane Blip Experts Say
Written by Samantha Joseph on November 4, 2004
By Samantha Joseph
September’s drop in home sales was a temporary blip and the market is recovering thanks to the area’s strong appeal, experts say.
Home sales in the Miami metropolitan area fell 24% from September 2003, which experts say can be blamed on an unusually active hurricane season that prevented hundreds of deals.
"We’re seeing people come here for all types of reasons," said Esslinger Wooten Maxwell Realtors president Ron Shuffield. "The market is only going to get better."
If home prices are any indication, Florida’s residential market remains highly desirable.
In Miami, the median sales price rose 25% from $232,500 to $289,800. Statewide, the median was up 23% to $194,700 from $158,900.
However, Miami saw a dip in single-family home sales despite escaping relatively untouched by the powerful hurricanes that ravaged the state in September.
About 871 single-family houses sold, compared to 1,143 a year earlier, leaving real estate agents to conclude that the hurricanes derailed at least 272 deals.
"By all indications, the sales and listings of real estate during October are virtually back to normal – way ahead of what had been predicted based on the disruption of activities," said Russel Grooms, president the Florida Association of Realtors.
The group has not released data for October.
Miami’s drop in sales mirrors a 23% decline in single-family home sales statewide.
Real-estate agents say the hurricanes prompted insurance companies to stop issuing policies, lenders to postpone closings and several companies to put off business.
"We experienced a little hiccup in sales because of the hurricanes, but we don’t foresee a long-term trend," said Watson Realty spokesman Andre Boutte. "There is a lot of growth here, and the housing market will continue to reflect that growth."
Despite strong demand and high prices for residential property in Miami-Dade County, owners are largely holding onto their houses.
Homeowners are listing fewer single-family houses for sale, driving up prices in a county real estate sellers say is already desirable to buyers in all income brackets.
So far this year, 3,801 homes have gone up for sale in Miami-Dade, compared with about 5,047 for the same period in 2003, according to data from Esslinger-Wooten-Maxwell Realtors.
For a buyer, the difference is about 1,200 fewer homes to choose from, but the relative scarcity has not curbed sales.
Last year, with hundreds of more homes on the market, Miami-Dade real estate firms sold about 1,181 single-family houses each month.
This year, despite a significant drop in sales during the hurricane season, the figure is only slightly lower, with about 1,141 homes changing hands each month in the county.
"If sales are essentially the same, while the inventory is decreasing, it simply means that fewer people are putting their houses up for sale," said Esslinger-Wooten-Maxwell president Ron Shuffield. "Sales would have been a lot higher if we had had more inventory."
Historically low interest rates and promises by Miami leaders to turn the city into a 24-hour community are driving the push for real estate in the metropolitan area.
Land shortages and strong demand from international buyers, primarily from Europe and Latin America, have spurred sales in much of South Florida.
Home prices have risen 23% statewide since September 2003, according to the Florida Association of Realtors.
Miami’s market outperformed the state’s, with a 25% increase.
In Florida, the median selling price for a single-family home is around $194,700.
But in Miami, where the median is about $289,800, homes are significantly more expensive.
"At the end of the day, the real estate business is a supply-and-demand business," Mr. Shuffield said. "As the supply decreases and the demand continues to remain strong, values will inevitably increase."