Line in the sand

The South Florida condo market appears to be crossing a crucial line in the sand.  During the month of February, the number of condos listed for sale reached 31,137.  That surpassed the recent high of 31,055 condos listed for sale in February of 2017.  Prior to that, we have to look back to June of 2011 when condo inventory was at 31,398.  That was after the financial crisis when the market was flooded with distressed properties.  Take a look at the red line in this chart below.  Basically, if this inventory doesn’t sell during the spring, it will continue to build toward crisis levels.  Is it time to lower the tower cranes in South Florida?

Line in the sand - Florida condo bubble

Line in the sand – South Florida condo inventory

This chart shows the condo inventory without single-family homes.  Is it time to panic?  Miami-Dade, Broward and Palm Beach County just surpassed the recent high set last February in condo inventory for sale.

Condo bubble part 2 in South Florida

Each line shows condo transactions by type

Here is a chart showing the types of condo transactions closing.  In February there were 3,188 closed sales, up slightly from 3,023 in January.

Condo foreclosure, short sales, traditional sales volume

And here is a snapshot of the combined deal volume.  You will notice that there was a strong buying spree last winter and spring.  Last March, April and may were big months for the South Florida condo market.  Will that enthusiasm return this year?  Builders are hoping it does, if not you will continue to see inventory of unsold condos grow and prices will begin to suffer.

Condo sales in South Florida Miami Fort Lauderdale Palm Beach

Median Sale Prices for South Florida Condos

How are prices holding up?  During the month of February, the median sale prices by deal type were as follows:

  • Traditional sale – $186,750, up from $185,000 in January
  • Foreclosure sale – $130,000, down from $136,500 in January
  • Short sale – $141,500, up from $136,500 in January

Condo prices Miami, Fort Lauderdale & Palm Beach Florida

The condo market is on the main stage and we are all watching to see if it flips or flops.  Although many speculators and investors pay cash, there are still plenty of buyers relying on mortgage financing.  Have you checked mortgage rates lately?  Here is a quick link to Bankrate  with some excellent mortgage tools for buyers in the market for a loan.  They have the latest rates offered by lenders and some nifty calculators as well!