Despite challenges, Miami-area real estate surges in 2020

2020 has been a most unique year. Coming into the first quarter, South Florida experienced a great surge in business and was tracking for an excellent year in real estate. With the pandemic, the market began to adjust based on the issues created by shelter-in-place orders, business closings, the economy, and the health crisis itself.

Another factor unique to 2020 is that it is a presidential election year. In non-pandemic election years, we normally see heightened activity at the beginning of the year and a slowdown as the election approaches; buyers tend to hesitate until the results are clear in order to feel confidence in the markets. This year, the surge in buying was particularly strong as shelter-in-place orders lifted and real estate professionals learned to navigate the art of selling in this new environment. In data based on all of Miami-Dade county (including that for both condominium and single family homes), you can see the sharp upward trend in “Accepted Offers” during May and June; that’s a great indicator of buyer activity because the properties will not close for 30 to 60 days. You can also see the downward trend of total inventory, even though there is still significant inventory on the market.

Despite the number of sales and decreasing inventory, the months of supply of inventory has remained fairly steady and has not dropped below six months, which tends to indicate a shift from “buyer’s market” to “seller’s market.” The market is healthy and steady, with an average of eight to nine months of inventory consistent from January to June of this year.

Miami houses more than 100 consulates, foreign trade offices, and bi-national chambers of commerce and headquarters countless banks, law firms and other businesses large and small, including an increasing number of innovative startup companies. We have amazing schools, universities, and hospitals attracting people from all corners of the globe. We have beaches, water features and parks sprinkled everywhere. We have two of the world’s finest airports and seaports, and our public transportation options have improved dramatically. With each passing day, we earn our reputation as “the magic city.” These factors matter, and they insulate our market in ways that other areas do not enjoy. In such an unusual market, it is important that both buyers and sellers work with experienced real estate professionals to get all the information they need to make good decisions. Our sellers and buyers have benefited from how quickly we have adapted to the technology necessary to market and sell in this new environment.

While the pandemic, the election, and hurricane season make the future of 2020 more challenging, I feel confident that correct pricing will remain the primary factor in Miami home sales in the months to come. You have likely heard the cliché about the key to real estate being location, location, location, but my 40-plus years in the business has taught me it is price, price, price!

Topics: Real Estate, Miami

Work cited: Pat Klock Parke, Miami Herald, July 17, 2020

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