As we are about to head into October, we have compiled the charts of the available inventory, price trends and the types of transactions making it to the closing table in Miami-Dade, Broward and Palm Beach County, Florida.  The first chart we will look at is the almost stagnant chart of available inventory listed for sale in South Florida:

As you will notice form the chart, the inventory numbers have barely moved in the past year.  The amount of properties listed for sale has never rebounded ever since the banks removed their distressed properties from the market in the fourth quater of 2010.  In August 2013, there were 15,615 houses and 19,824 condo/townhouse properties listed for sale in the tri-county area.

From the chart of the average selling prices above, you will notice that the average selling price of single-family homes has been dropping in the past few months.  In May, the average selling price of a house in South Florida reached a multi-year high of $427,299 and has slipped to $366,383 in August.  That is roughly a 15% drop in a few months.  I am sure that the spike in interest rates in June may have been a factor.  Also, the “investors” that were driving up prices to rent single-family homes out are realizing less than stellar returns at current prices.  If they haven’t already done so, they will soon realize that the REO to rental business is not all it is cracked-up to be and the are better investment returns elsewhere.  As for the average selling price of a condo/townhouse property in South Florida, it reached $250,069 in May slipped as low as $232,199 in July and has rebounded slightly in August to $240,851 in August.  That represents about  a 4% drop in the past few months.

As for interest rates, they have slowed their climb for now, but there is no doubt that the increase  from May to June still had an impact on the market.

Now, let’s have a look at what type of transactions are closing.  We will look at the single-family home market first.

Traditional transactions have dominated the market throughout 2013, but appear to be slowing.  Here is the breakdown of the 4,067 transactions that closed in the South Florida in the month of  August:

• 2,864 traditional closings for roughly 70% of all closings
• 562 foreclosure/REO sales that made up roughly 14% of all closings
• 641 short sales for roughly 16% of all closings

The foreclosure/REO sales will eventually take a bigger piece of the pie as the banks are finally starting to foreclose again.  There is already a slight dip in the short sales and slight increase in the number of bank sold REO transactions getting closed, so it should be interesting to see this trend develop.  Now, let’s see what types of deals are getting done in the condo/townhouse market in South Florida.

Out of 4,096 South Florida condo/townhouse property closings  for August, the breakdown was as follows:

• There were 2,941 traditional closings that accounted for 72% of all sales
• 679 foreclosure/REO transactions were 16% of all closings
• The 476 short sales accounted for 12% of all closings in the South Florida market

In May, there were 676  short sale transactions in the South Florida market, so the 30% drop in bank short sales is worth noting.  It could be that any short sales that could be done are now completed and the next wave of distressed property sales will be bank sold REO transactions.  Stay tuned and we will continue to monitor all of the real estate activity in the areas of Miami, Fort Lauderdale, Palm Beach and surrounding cities.