Home sales in South Florida continue their downward trend in October, according to a report released by the Miami Association of Realtors. However, year-to-date, Miami-Dade County will have the second best year in sales in historical analysis, second only to 2021.
Adding Miami-Dade, Broward and Palm Beach counties, total sales in October 2022 were 6,216, which represents a decrease of 30.6% compared to October 2021. The numbers follow a slowing trend, since there was a drop of 20% in August and 25% in September.
The drop is a reflection of the interest rate increase policy of the FED (American Central Bank) to contain inflation.
Despite the drop in sales, average prices continue to rise and the year 2022 promises to be the second best year in historical sales in South Florida, registering, until October, a total of 28 thousand units sold. The record, from 2021, reached almost 40 thousand units sold.
In terms of financial volume, the number drops 20% in the comparison between October 2022 and October 2021. It was US$ 4 billion in the sum of the three counties.
Opportunity for investors
Despite still being an essentially “seller” market, that is, absorption rate of less than 5 months, the moment is good for buyers.
Interest rates are high now, but they shouldn’t stay there for long. The monetary policy underway at the FED reflects the occasional need to contain inflation, which comes from a mismatch caused in the last two years.
Once inflation is under control, it is natural for the Fed to bring the basic interest rate back to more balanced levels, stimulating the economy again. As a result, the real estate market would also receive a new injection of stimulus.
It is worth noting that over the next few years, Florida will receive hundreds of new residents daily. In a market already with very low inventory, the supply-demand imbalance will remain. Even if construction companies run out of time, a project can take up to 6 years to be delivered to the final buyer, ready to move in.
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About AMG International Realty
AMG International Realty is a global real estate company specialized in Florida. If you are interested in taking the opportunity to learn about investment opportunities in the Miami and Orlando regions, contact me right now and chat with me on WhatsApp: +1 305 318 6968 (Heloisa Arazi).