Miami-Dade County continues to show it’s the place to be for many, as demand for single-family homes climbs. Driven by a lack of inventory, the result is surging prices and bucking national trends in real estate.
The median price for single-family homes in Miami-Dade is now at $620,000, up from $600,000 in April, according to May 2023 statistics released by the Miami Association of Realtors and the Multiple Listing Service system. The price was $575,000 during the same period in 2022.
“Single-family homes are an issue in terms of affordability, and we don't have much land to build single-family homes on,” said Eli Beracha, director of the Hollo School of Real Estate at FIU Business. “And if you need to build something, it’s very expensive.”
While Miami-Dade is long used to the influx of transplants from other states as well as neighboring regions like the Caribbean and Latin America, low taxes as well as lax protocols during the COVID-19 pandemic drew even more.
“We have this additional trigger of people that came here recently who are essentially spreading the word,” said Beracha. “People joke, but if they post a photo of themselves swimming in a pool in January, and their friends in New York see it, those are the things that are also triggering people to continue to come here.”
Even if the population thins out, the demand for homes will remain high because there simply aren’t enough houses.
Those waiting for interest rates to drop should perhaps think again, Beracha noted, forecasting that problems are likely to get larger.
“At that point housing prices will be even higher because you'll have all those people who were waiting for interest rates to go down that are entering the lending houses,” he said.
While the outlook might seem dismal for anyone in the market for a new home, Beracha does offer some options.
“I’d recommend the same thing you do during any strong market, remove contingencies, shorten inspection time, give a strong deposit,” he said. “Even though housing prices are high, if you need a home and can afford a home right now, I would buy it and refinance in a couple of years.”
As Miami-Dade continues to be challenged with creating more housing for its residents, steep prices may just become the new normal. Beracha pointed out that tax incentives and zoning changes will help, but only so much.
“At the end of the day if Miami is becoming more attractive, then it will also become more expensive,” he said. “How do you make Paris cheaper, London, New York? You don't. Those are expensive places for a reason, because they're attractive, and there is something there that people want and that makes it expensive.”