Persquarefoot Housing Prices Soaring
As condo sales have continued to rise all over Miami, the average price per square foot has continued to climb, with the condo market soaring and inventory dropping.
Currently, Coconut Grove condos are selling for anywhere from $247 to upwards of $700 per square foot. Condos in the center of the Grove are on the lower end, ranging from $247 to $350 per square foot, according to Charlette Seidel, branch manager at Coldwell Banker’s Coral Gables office.
After years of crisis, the real estate market has been trending upward, but with the rise in prices comes a drop in inventory.
“It is supply and demand,” said Mrs. Seidel. “Inventory has been reducing and prices have been going up… It’s the lowest inventory I’ve seen in years.”
Single-family homes have seen an increase as well. The average price per square foot of a single-family home in Miami-Dade County in May was $185, up from $171 in May of last year, according to Ron Shuffield, president and CEO of Esslinger-Wooten-Maxwell Realtors (EWM).
Though the trend has been upward, per-square-foot prices don’t compare to the average of $273 seen in May 2007 during the height of the real estate boom.
Condo prices have changed even more drastically, with the average per square foot price in the county at $283 this May, Mr. Shuffield said. This is an increase from $234 a year ago; though still less than the $344 per square foot seen in 2007.
Overall, the median price of condos has continued to increase substantially over the past three years. The median sale price of a condo in the county in the second quarter of 2010 was $125,000, according to figures from The Keyes Company. Today that price is $185,000.
“You have a market that is transitioning from a distressed market to a healthy market,” said Mike Pappas, Keyes president and CEO. “Overbuilding supply caused distress and default by developers… Now, you are starting to get to a healthy market.”
With rising prices, inventory continues to drop. Even though two-thirds of the market consists of condo sales, with single-family homes only making up one-third, there’s not a large inventory available. For instance, according to Mr. Pappas, in Brickell only 3% of the condos are on the market.
The rise of condo sales illustrates Miami’s ongoing urban growth. As less land and fewer homes are available, Mr. Pappas said, condo sales rise, since condos generally are built vertically and aren’t as affected by land costs.
“Miami has the third largest urban market in the country,” Mr. Pappas said, second only to New York City and Chicago.
Interest in condos and prime locations comes from the many foreign buyers who are interested in Miami, as well as first-time buyers who are interested in convenience and less commute time and owners who are less interested in a big home and its upkeep, Mrs. Seidel said.
“People seem to like being able to walk to a city,” she said. “We’re urban creatures now. It’s a lifestyle change.”To read the entire issue of Miami Today online, subscribe to e-MIAMI TODAY, an exact digital replica of the printed edition.