Now that the June numbers are in, we are at the midway point of the year and should be able to spot some of the residential property trends in South Florida.  First-up, let’s take a look at the inventory data:

It looks like the condo/townhouse inventory remained stable, with 20,307 units listed for sale in June.  As for the single-family home segment, inventory increased 17,299 homes listed for sale, up from 15,056 in May.  This is most-likely a byproduct of the recent price strength and more people peeking their heads out of their negative equity positions to test the market.  Speaking of prices, let’s see how they are shaping up.

Here is a look at the single-family home segment in the tri-county area.  The first chart shows the price trend, followed by the transaction types in the next chart:

It looks like the traditional transactions held strong in June, as they totaled roughly 73% of all closings.  Foreclosure/REO sales were roughly 10% of all sales and short sales made up the last 17% of all closings for the month of June.

Next, here is a snapshot of the condo/townhouse market in the tri-county area:

The number of traditional sales in the condo/townhouse segment dropped significantly in June to 2,811, down from 3,586 in May.  Meanwhile, the Foreclosure/REO sales and short sales remained mostly unchanged from the previous month at about 14% of all closings for each category.

Now for the headwinds in the market, or the 1-2 punch.  The first problem that the South Florida residential real estate market is facing is the highly elevated level of new foreclosure filings.

To breakdown the numbers by County:

• Miami-Dade County had 4,783 new foreclosure filings in June and the level is at it’s highest point in a few years
• Broward County had 3,159 new foreclosure filings in June, which is an 89% increase over May
• Palm Beach County had 2,045 new foreclosure filings in June, which was a 77% increase over May
• The monthly average of new foreclosure filings in the tri-county area was 4,053 in 2012, but is now 7,430 at the halfway point of 2013.  This is not a good trend, as it represents a 83% increase in new filings.
• If you add the monthly foreclosure filings to over 130,000 single-family and condo properties that are currently in some stage of foreclosure throughout the tri-county area, this data is by no means indicative of a “housing recovery”.

As for the next headwind facing the market, the final chart shows the recent jump in interest rates.

The spike in rates took place in the last week of June, so the impact on June data may have been limited.  However, the 1-2 punch of higher rates and more foreclosures entering the market will certainly apply downward pressure on residential property prices over the next few years.