2016 LUXURY REAL ESTATE MARKET REVIEW
CORAL GABLES
MID-YEAR REPORT CREATED BY
BEN MOSS
Dear Neighbor, I would like to share my Coral Gables Luxury Residential Real Estate Market Report for January through June of 2016. While there is only so much information I can provide in this written report, you can find updates at the end of each quarter at www.benmossgroup.com. You will also find a breakdown of what is happening in specific Coral Gables neighborhoods. A shift from a seller’s market to a buyer’s market is taking place currently, so I welcome the opportunity to be your real estate consultant during this transitioning market. If I can ever be of service to you, please contact me and I will prepare a no-strings-attached market analysis for your property.
Best regards,
www.BenMossGroup.com
MARKET OVERVIEW * CORAL GABLES –
WATERFRONT
Average Number of Monthly Active Listings
Average Number of Monthly Closed Sales
Average Sale Price/ Square Foot
MARKET SNAPSHOT Unlike many other markets throughout South Florida, the waterfront Coral Gables market has not witnessed a sharp uptick in the number of houses being added to the market for sale every month (although the overall supply is sharply higher due to the decrease in volume of closed sales). Roughly as many houses are being added to the market on a monthly basis during the last six months as were added to the market during the first six months of 2013. However, an average of 11 more houses are being added to the market every month YTD in 2016 versus 2015 (71 versus 60). During the first six months of this year an average of 4 houses have sold per month, in contrast to the least three years in which an average of at least 6 houses were sold per month. Buyers have more inventory from which to choose and there seem to be less overall buyers in the market today than in previous years. The increase in the average sale price per square foot (32% over the last four years) is surely giving pause to some buyers, and/or pricing others out of the market for waterfront houses.
* Minimum house size of 3,000 square feet for consideration within Market Overview. Data sourced from Multiple Listing Service.
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MARKET OVERVIEW * Exploring Supply–ofWATERFRONT Houses on the Market-WF CORAL GABLES
40 35 30 25 20 15 10 5
Date Range: 2 Years
Months of inventory (Closed Sales)
6-16
5-16
4-16
3-16
2-16
1-16
12-15
11-15
10-15
9-15
8-15
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3-15
2-15
1-15
12-14
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8-14
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0 6-14
Months of Inventory (Closed Sales)
Exploring Supply of Houses on the Market
Moving Average
This graph outlines the supply trends in the market. If we compare the supply of housing inventory over the first six months of this graph Exploring Pricing Trends-WF (June – November 2014) as compared to the last six months (January – June 2016), we see that the average house will take almost twice as long to sell today than it did two years ago. Unlike the non-waterfront market, which has seen a much slower growth of supply, this is a big shift. Two years ago, using the six-month averages noted above, the average house sold in 9.2 months. Today, the average house will sell in 18.6 months. Despite some high-priced sales, the overall market has really shifted in the favor of buyers rather quickly. Looking back, it appears the market dynamics really started changing in the summer of 2015, at which point the volume of waterfront house sales declined, coupled with more houses being added to the market for sale. I expect this trend to continue for the rest of this year, until price declines start to bring more buyers back to the market. The moving average line in this graph helps smooth out any spikes on a monthly basis, which helps to visualize trends.
Exploring Pricing Trends
Date Range: 2 Years
Avg. Active Price
6-16
5-16
4-16
3-16
2-16
1-16
12-15
11-15
10-15
9-15
8-15
7-15
6-15
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2-15
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12-14
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6-14
$9.000,000 $8.000,000 $7.000,000 $6.000,000 $5.000,000 $4.000,000 $3.000,000 $2.000,000 $1.000,000 0
Avg. Sold Price
This graph showcases the relationship between the average prices of homes listed for sale as compared to closed sales. In the waterfront market, there are big swings in sale prices due to an ultra-luxury sale which can skew the data. Generally, prices of active listings and closed sales are both up over the last two years if we compare them to the prices during the first three-month period of the chart. However, one key change is that the average difference between list and sale prices during these two time periods has diverged, from a 26% difference in June – August 2014 to a 36% difference in April – June 2016. Generally speaking, this means that on an increasing basis over the last two years, the lower-priced waterfront homes are the ones that are selling. This graph doesn’t tell the whole story, because pricing is a lagging market indicator. By seeing the drastic increase in housing supply over the last two years, as well as a reduction in the volume of sales we should see downward pressure on pricing becoming more of a factor in the months to come. We will continue to witness large, even record-breaking, one-off sales for special properties, but the overall waterfront market will have to experience a reduction in pricing to counter the other trends we are seeing in the market as we move into 2017.
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* Minimum house size of 3,000 square feet for consideration within Market Overview. Data sourced from Multiple Listing Service.
Exploring Negotiation Trends_WF
MARKET OVERVIEW * CORAL GABLES – WATERFRONT
Exploring Negotiation Trends 110% 105% 100% 95% 90% 85% 80% 75%
6-16
5-16
4-16
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2-16
1-16
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6-14
70%
Date Range: 2 Years
Sold/List Price Diff. %
Sold/Original List Price/Diff. %
This graph outlines the factor by which buyers and sellers are negotiating off of the list prices of houses that have sold. Interestingly, despite a market that has grown weaker for sellers, there is less of a negotiation factor today than compared to two years ago (11.7% discount to the list price during the six month averages from June – November 2014 versus a 6.7% discount to the list price during the six month averages from January – June 2016). However, if we compare the discount of the sale prices to the original list prices of houses that have sold, the negotiation factors have remained fairly steady at 12.4% and 11.8% during the same respective time periods. This indicates that sellers who have sold their properties in the last six months have successfully priced their houses to sell at a level much closer to the actual market. Those who don’t price their properties realistically will see their properties languish on the market for sale.
* Minimum house size of 3,000 square feet for consideration within Market Overview. Data sourced from Multiple Listing Service.
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MARKET OVERVIEW * CORAL GABLES – NON-WATERFRONT
Average Number of Monthly Active Listings
Average Number of Monthly Closed Sales
200 180
18
160
16
140
14
120
12
100
10
80
8
60
6
40
4
20
2
0
Jan 2013 June 2013
Jan 2014 June 2014
Jan 2015 June 2015
Jan 2016 June 2016
0
Jan 2013 June 2013
Jan 2014 June 2014
Jan 2015 June 2015
Jan 2016 June 2016
Average Sale Price/ Square Foot $500 $450 $400 $350 $300 $250 $200 $150 $100 $50 $0 Jan 2013 June 2013
Jan 2014 June 2014
Jan 2015 June 2015
Jan 2016 June 2016
MARKET SNAPSHOT By looking at the data at the mid-year over the past four years, we see mixed signals. The metric that jumps out to me is the sharp increase in inventory, from an average of 84 properties listed for sale per month during the January – June 2013 period, up to a current supply of an average of 186 properties that have been listed per month from January – June 2016 (an increase of 121%). In contrast, the average number of closed sales per month during that time has increased from 9 properties to 16 properties (an increase of 81%). The volume of sales is the highest it’s been in four years, and so is the average sale price/square foot, which has increased from $353 to $430, an increase of 22%. As the supply of houses for sale has outpaced the actual sales, the market has gradually shifted from a seller’s market to a buyer’s market (see Exploring the Supply of Houses on the Market). Overall, the Coral Gables non-waterfront luxury market is much healthier than most other sub-markets in South Florida, and the shift into the buyer’s market territory is less pronounced than in many other sub-markets.
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* Minimum house size of 3,000 square feet for consideration within Market Overview. Data sourced from Multiple Listing Service.
FOR SALE: THE GRAND OAK ESTATE, SNAPPER CREEK 10001 Fairchild Way, Coral Gables, FL
CONTACT BEN MOSS 305-793-4783 The 9,096 sq.ft residence is located in Snapper Creek and has 6 bedrooms, 8.5 bathrooms, and is set on just over 1 acre. Listed at $6,750,000 – Sq. Ft.: 9,096 – 6 Bedrooms/8.5 Bathrooms – Lot Size: 45,430 sq.ft.
FOR SALE: CASA LUJOSA 7265 SW 105 TERRACE, PINECREST, FL
CONTACT BEN MOSS 305-793-4783 Casa Lujosa has 5 bedrooms, 4 bathrooms, 4,386 sq. ft., luxurious finishes such as cown moldings, coffered ceilings, built-in speakers, salt-water filtration pool, loggia, and more. – Listed at $1,750,000
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FOR SALE: Ponce-Davis 4991 SW 86 Street, Miami, FL
CONTACT BEN MOSS 305-793-4783 Extremely secluded and most private lot in all of Ponce-Davis. Build your family compound up to 11,600 square feet. Offering includes an existing structure which can be modified, expanded, or torn down. Listed at $1,995,000
FOR SALE: VILLA CELESTE 5874 SW 131ST TERRACE, PINECREST, FL
CONTACT BEN MOSS 305-793-4783
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Located in Gables by the Sea this home has 5 bedrooms, 3.5 bathrooms, 5,173 sq. ft., tropical backyard pool setting, volume ceilings, large second floor balcony, privately located at the end of cul-de-sac. Listed at $1,459,000
MARKET OVERVIEW *
Exploring Supply of Houses on the Market
CORAL GABLES – NON-WATERFRONT
20 18 16 14 12 10 8 6 4 2
Date Range: 2 Years
Months of inventory (Closed Sales)
6-16
5-16
4-16
3-16
2-16
1-16
12-15
11-15
10-15
9-15
8-15
7-15
6-15
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4-15
3-15
2-15
1-15
12-14
11-14
10-14
9-14
8-14
7-14
0 6-14
Months of Inventory (Closed Sales)
Exploring Supply of Houses on the Market
Moving Average
This graph outlines the supply trends in the market. If we compare the supply of housing inventory over the first six months of this graph (June – November 2014) versus the last six months (January – June 2016), we see that the average house will take four months longer to sell today than two years ago. Two years ago, using the six-month averages noted above, the average house sold in 8.5 months. Today, the average house will sell in 12.8 months. The data indicates that we are now in a “buyer’s market”, which is defined as a market with 9 or more months of supply. My experience in this market suggests also Exploring Negotiation Trends that we will see this trend continue into 2017 and buyers will gain more leverage in negotiations with sellers due to increasing supply (i.e. more houses for them to choose from). The moving average line in this graph helps smooth out any spikes on a monthly basis, which helps to visualize longer-term trends.
Exploring Negotiation Trends 100% 98% 96% 94% 92% 90% 88% 86% 84%
Date Range: 2 Years
Sold/List Diff. %
6-16
5-16
4-16
3-16
2-16
1-16
12-15
11-15
10-15
9-15
8-15
7-15
6-15
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4-15
3-15
2-15
1-15
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10-14
9-14
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6-14
82%
Sold/Orig LP Diff. %
This chart outlines the factor by which buyers and sellers are negotiating off of the list prices of houses that have sold. In general, there has not been a noticeable change in this factor over the last two years. The average negotiation factor off of the list price for houses that have sold has ranged between 8 – 2% in any given month. However, if we look at the average negotiation factor over the first six months of this graph (June – November 2014) as compared to the last six months (January – June 2016), the average discount to the list price has been 6.9% and 6.3%, respectively. Since many houses are reduced in price before they sell, the negotiation factor is higher when computed against the original list price. However, the trend remains fairly steady on this basis as well, with a negotiation factor off of the original list price of 9% during the June – November 2014 time period as compared to 8.7% during the January – June 2016 time period. * Minimum house size of 3,000 square feet for consideration within Market Overview. Data sourced from Multiple Listing Service.
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MARKET OVERVIEW * CORAL GABLES – NON-WATERFRONT
Exploring Pricing Trends
Exploring Pricing Trends $3.500,000 $3.000,000 $2.500,000 $2.000,000 $1.500,000 $1.000,000 $500,000
Date Range: 2 Years
Avg. Active Price
6-16
5-16
4-16
3-16
2-16
1-16
12-15
11-15
10-15
9-15
8-15
7-15
6-15
5-15
4-15
3-15
2-15
1-15
12-14
11-14
10-14
9-14
8-14
7-14
6-14
0
Avg. Sold Price
This chart showcases the relationship between the average prices of homes listed for sale as compared to closed sales. From September 2014 – February 2015, we witnessed the widest gap between these two metrics, with the average house selling for less than 60% of the average list price. Since that time, the gap has narrowed as the market has softened for sellers. We also see that despite the fluctuations over the last two years, the data for the first three month period compared to the last three month period (June – July 2014 versus April – June 2016) is not all that different. With respect to average list price during these periods, the former was $2,420,667 versus the latter of $2,376,333 (a decline of 2%). With respect to the average sale price during these periods, the former was $1,697,333 versus the latter of $1,765,667 (an increase of 4%). While sale prices have increased over the last two years, it should be noted that sale prices are a lagging indicator. The increase in housing supply (see Exploring the Supply of Houses on the Market) should apply downward pressure on pricing. In fact, we have seen downward pressure in pricing from the peak, if we compare the average sale price in the April – June 2016 period as compared to where it was holding during the May - July 2015 period ($1,950,667), accounting for a 9% decrease in the average sale price.
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* Minimum house size of 3,000 square feet for consideration within Market Overview. Data sourced from Multiple Listing Service.
FOR SALE: SOMI LOCAL 7641 SW 59 COURT, SOUTH MIAMI, FL
CONTACT BEN MOSS 305-793-4783 Walk to Downtown South Miami! 6 bedrooms, 7 bathrooms, 5,897 sq. ft., 19,886 sq. ft. lot, heated pool, huge covered patio, floor to ceiling windows, and gated. Listed at $2,295,000.
FOR SALE: CASA TROPICAL 12101 SW 62 AVENUE, PINECREST, FL
CONTACT BEN MOSS 305-793-4783 Brand new tropical contemporary estate with 7 bedrooms, 7 full and 2 half bathrooms, 11,066 sq. ft., 800-bottle wine cellar, 54-foot pool, summer kitchen and loggia, sundeck, 3 bonus rooms: office, game/media room, upstairs den with wet bar, guest suite, and 2 master bedrooms. Listed at: $5,295,000.
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7650 SW 59th Court, Miami, FL 33143
Top 10 Producing Realtor at ONE Sotheby’s International Realty
BEN MOSS
ESTATE AGENT & MANAGING DIRECTOR, SPORTS & ENTERTAINMENT DIVISION
How Do These Trends Impact The Value Of Your Home?
I am offering a no strings attached home valuation for Coral Gables homeowners. Simply send me your name and address to Ben@BenMossGroup.com or visit this link http://pricemymiamihome.com/.
About Ben Moss – Top 10 Realtor at ONE Sotheby’s in 2015 – Coral Gables/South Miami resident for 31 years – Launched ONE Sotheby’s Sports & Entertainment division in 2014 – Ben Moss Group sold $ 64,000,000 in 2015 – Member of Master Brokers Forum and the Institute for Luxury Home Marketing’s Million Dollar Guild – Real estate educator for the Miami Dolphins rookie class – 6 consecutive years – Fluent in English and Spanish
Relationships Ben’s goal in life is to build long-lasting relationships in every facet of his life that are built on a foundation of trust, service, and friendship.
Call Ben today at 305-793-4783 or email him at Ben@BenMossGroup.com ConnectwithBenonSocialMedia@BenMossGroup
www.BenMossGroup.com