[This week, real estate appraiser, Curbed graph guru, blogger, and podcaster Jonathan Miller launches the Miami edition of his long running Three Cents Worth column, by looking at those other matrices of the market]
There has been a lot of attention paid to Miami's high end market and the idea that foreign buyers are turning the market around. All the coverage has zeroed in on sales and price trends. I thought I'd present what some of the other metrics are saying.
Two of the most neglected stats in Miami's housing market discussion have been days on market and listing discount. My data included all distressed and non-distressed properties in the market report we prepare for Douglas Elliman. I prefer to use days on market that measures from the last time the list price was changed to the contract date. In my view this is a better reflection of when a property actually (not technically) enters the market. I apply the same reasoning to the listing discount, the percentage difference between the list price at time of contract and the contract price. The closer the spread is, the less negotiable the transaction becomes so it really matters when the property "actually" enters the market.
Days on market: Over the past 2 years, the time it takes to sell a Miami property has remained remarkably stable, actually hovering around 70 days, below the levels seen during the height of the market in the middle of the last decade. I'd love to go back even farther to look at the trends, but the historical data for the MLS ends at the beginning of 2006 when I believed the MLS switched software. However that mid-decade moment coincided with the housing market peak so perhaps we could also chalk that off to the MLS not wanting to stir up old memories?
Listing discount: For the past 2 years the spread between list price and sales price has been trending lower, from just under 12% to around 8%. That compression probably means one of two things: buyers and sellers are getting more in sync or sellers are being more realistic when pricing their properties initially. I'm thinking it's more of the former.
The takeaway I get from these trends is that the housing market is fairly stable and has perhaps been even tightening up a bit over the past 2 years. Properties are selling more quickly than mid-decade but the spread between buyer and seller, while improving, still remains too wide to characterize the overall market as robust.