MiamiRealEstateKing

Pending Sales Spike in January, 2011 in Miami-Dade

In real estate on February 10, 2011 at 6:26 pm

Amazing. While some continue to publish gloom and doom…Pending Sales continue to move in the opposite direction.

January, 2011 has sparked a 23.7% increase in Pending Sales (properties under contract), over December, 2010 in Miami-Dade, signaling that buyers came out of the holidays making offers and committing them to paper.

Also, January 2011’s Pending Sales were up by a healthy 44.2% over January, 2010.

In addition, the total number of properties For Sale dipped 5.3% over December, 2010 (and for the 3rd month in a row), even with 461 properties added to the inventory for a 10.6% increase in New Listings in January, 2011 (first increase in New Listings since July, 2010).

Though not surprising for December, what needs to improve on a consistent basis still, is the number of Closed Sales (down 23.2% over December, 2010), although, we saw a strong increase of 30.6% in Closed Sales over January, 2010.

This is the first dip in Closed sales since it began to steadily increase in October, 2010 and may have been very likely attributed to the holidays, as it is typically. I suspect that, even with fewer days in February, we will see another spike in Closed Sales at the end of this month over January.

So…for all those continuing to whine about how bad things are…just note once again the improvement in Pending Sales and Closed Sales over January, 2010 and you’ll know why deals are flying off the shelf…for cash.

About 60% of all Closed Sales were Distressed Sales and of these, about 70% were REOs while the rest were Short Sales.

Although we need to reverse this trend (and allow more short sales to take their course than REOs), 70% of all Closed REO deals were for Cash, while well over 90% of all Short Sales in January, 2011 Closed for Cash.

About 30% of REOs not selling for Cash likely went to first-time buyers / owner-occupants, most of whom received FHA or Conventional financing. This may be good news for those looking for bargains as they finally buy their “home sweet home”.

Buyers looking for REO deals typically get taken off the market by investors – except for those working with professionals who can point to non-investor buyers the deals, the moment they come to market (or before), since the first 15-days a (HUD, Fannie or Freddie), REO listing is active, is typically reserved for owner-occupant offers only.

Finally, the Average Closed Price in January, 2011, dipped 25% over December, 2010’s $260,000, while the Average Price of Active Listings rose 2.3%, demonstrating the continued disconnect between what sellers think they can get (in spite of the good news in increased activity), and what buyers are still willing to pay.

The Average Price of Closed Sales dove 20.7% to $195,000 in January, 2011 (pre-2002 levels), as compared to January, 2010’s $246,000.

The Average Closed Price in Miami-Dade hit its bottom in September 2010 when it was at $217,000 and rose 3 consecutive months to December 2010’s $260,000 before slipping in January, 2011.

Similarly, the Median Closed Price of homes in Miami-Dade dropped another 10.9% in January, 2011 over December, 2010’s levels. January, 2011’s Median Closed Price is now at $115,000 over December 2010’s $129,000 and down 20.7% over January 2010’s $145,000.

This means that we are STILL in a strong Buyer’s Market and sellers must NOT be distracted from their job to SELL if this is what they must do.

Of course, these price levels are also a reflection of which price points continue to move (below $200,000), and are an indication that Miami continues to be poised for a correction of still lower prices through 2011. Sellers who must sell now, must adapt or sink.

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