Residential Market Trend Update – June 30, 2010 (2010 Q2) Downtown Development Authority District and Adjacent Areas of Influence
Prepared for:
Published July 2010
A Professional Strategic Alliance
Lewis M. Goodkin, CRE, FRICS, MIRM Lewis.goodkin@goodkin.com 305.860.0771
Craig A. Werley, CRE, FRICS
cwerley@focusadvisors.net 305.441.6438
TABLE OF CONTENTS I.
RESIDENTIAL MARKET TREND UPDATE .......................................................................................................1 RESIDENTIAL SALES UPDATE ............................................................................................................................. 1 RESIDENTIAL PRICE TREND UPDATE ................................................................................................................ 2 RESIDENTIAL LEASING VELOCITY AND RENTAL RATE TRENDS .............................................................. 4 RESIDENTIAL FORECLOSURE ACTIVITY .......................................................................................................... 6
LIST OF EXHIBITS EXHIBIT I.1 RESIDENTIAL SALES (CLOSINGS) TREND-UPDATE ..................................................................... 1 EXHIBIT I.2 RESIDENTIAL SALES PRICE TREND-UPDATE ................................................................................ 2 EXHIBIT I.3 RESIDENTIAL SALES PRICE PER SQ.FT. TREND-UPDATE ........................................................... 2 EXHIBIT I.4 RESIDENTIAL SALES PROFILE BY MONTH AND SUB-MARKET ................................................ 3 EXHIBIT I.5 UNSOLD NEW CONDOMINIUM UNITS BY DISTRICT.................................................................... 4 EXHIBIT I.6 DOWNTOWN MIAMI STUDY AREA LEASING VELOCITY............................................................ 5 EXHIBIT I.7 DOWNTOWN MIAMI STUDY AREA RENTAL RATES .................................................................... 5 EXHIBIT I.8 FORECLOSURE ACTIVITY – DOWNTOWN MIAMI STUDY AREA .............................................. 6
Miami DDA- Residential Market Trends Update (2010 Q1)
STUDY AREA
Miami DDA-Residential Market Trends Update (2010 Q1)
I. RESIDENTIAL MARKET TREND UPDATE This report presents a statistical update of key residential market trends in the downtown area and includes trends through June 30, 2010 including: • • • •
Monthly Residential Sales Activity (Closings) Price Trends Residential Leasing Velocity Foreclosure Activity
The information presented in the following exhibits is based on direct research of public records maintained by the Miami-Dade County Appraiser and County Clerk along with MLS and other independent data services. Research using the above noted sources was supplemented, as deemed necessary, by direct field reconnaissance. RESIDENTIAL SALES UPDATE
Average monthly residential sales in the Miami Downtown Area in the 2nd quarter of 2010 were 326 units, up from an average of 318 per month during the 1st quarter 2010. There was little fluctuation in monthly sales during the 2nd quarter ranging between 310 and 338 per month as shown in Exhibit I.1.
Residential Sales Update Downtown Miami Study Area, June 2009 through June 2010 500
486
450
439
Closed Sales (Units)
400 350
339
300 250 200 150
248
330
279 268 234
310
338
262 254
203
100 50 0
Source: Miami‐Dade Public Records; MLxchange; Realist; Focus Real Estate Advisors, LLC.
EXHIBIT I.1 RESIDENTIAL SALES (CLOSINGS) TREND-UPDATE
Total sales in the first six months of 2010 (1,933) were up 110% over the first six months of 2009 (919). Monthly housing sales in the downtown area fluctuated during the past six months with spikes in December and March having been influenced by bulk sales activity and by the expiration of the first-time home buyer tax credit program, respectively. For home purchases where a binding sales contract was signed by April 30, 2010, qualified buyers now have until September 30, 2010 to complete the purchase. Accordingly, this extension could impact residential closings volume in the downtown area through the third quarter of this year. Miami DDA-Residential Market Trends Update (2010 Q2)
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Bulk sales accounted for approximately 7% of total sales in the 2nd quarter of 2010 down from 16% in the first quarter of 2010. RESIDENTIAL PRICE TREND UPDATE
The average unit sales price in the second quarter of 2010 was up 3% from the first quarter to $361,000 from $351,100. The average price for the first six months of 2010 was up 16% from the first six months of 2009, from $306,700 to $356,100.
Average Sales Price Trend Downtown Miami Study Area $500,000 $450,000
Average Unit Sales Price
$400,000 $350,000 $300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $0
Source: Miami‐Dade Public Records; MLxchange; Realist; Focus Real Estate Advisors, LLC.
EXHIBIT I.2 RESIDENTIAL SALES PRICE TREND-UPDATE
Average Sales Price Per Square Foot Downtown Miami Study Area $400 $350
$321 $300
Price /SqFt
$300 $250
$243 $236
$256
$279 $271
$287 $297 $278 $297
$307
$325
$200 $150 $100 $50 $0
Source: Miami‐Dade Public Records; MLxchange; Realist; Focus Real Estate Advisors, LLC.
EXHIBIT I.3 RESIDENTIAL SALES PRICE PER SQ.FT. TREND-UPDATE
Miami DDA-Residential Market Trends Update (2010 Q2)
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The average price per square foot for units sold in the second quarter of 2010 was $318 up 9% from $292 in the first quarter of 2010. The average sales price per square foot for units sold in the first six months of 2010 was up 14% to $305 per square foot from $268 per square foot in the first six months of 2009.
Downtown Miami Study Area Residential Sales Update and Profile, June 2009 ‐ June 2010 Monthly Sales Profile Jun‐09 Jul‐09 Aug‐09 Sep‐09 Oct‐09 Nov‐09 Dec‐09 Jan‐10 Feb‐10 Mar‐10 Apr‐10 May‐10 Jun‐10
Units Sold
Total Sales Volume ($)
Total Sq.Ft.
Average Unit Price $/SqFT
203
$58,972,233
228,911
$290,504
$243
248
$63,460,150
271,825
$255,888
$236
279
$83,465,733
312,142
$299,160
$256
268
$83,532,567
299,516
$311,689
$279
339
$98,294,072
362,471
$289,953
$271
234
$79,260,145
263,779
$338,719
$300
486
$152,556,872
530,811
$313,903
$287
262
$87,872,433
296,122
$335,391
$297
254
$81,364,900
292,165
$320,334
$278
439
$166,042,566
559,600
$378,229
$297
330
$123,399,750
384,779
$373,939
$321
310
$103,347,900
336,872
$333,380
$307
338
$126,301,807
388,934
$373,674
$325
Breakdown by Area ‐ 2nd Quarter 2010 Units Sold
Brickell CBD Park West M&E/Wynwood Total Q2‐2010
Total Sales Volume ($)
Total Sq.Ft.
Average Unit Price $/SqFT
587
$229,126,500 672,581
$390,335
$341
195
$55,503,917 199,012
$284,635
$279
82
$45,685,140 132,266
$557,136
$345
114
$22,733,900 106,726
$199,420
$213
978
$353,049,457 1,110,585
$360,991
$318
Source: Miami‐Dade Public Record; Mlxchange; Realist; Focus Real Estate Advisors, LLC.
EXHIBIT I.4 RESIDENTIAL SALES PROFILE BY MONTH AND SUB-MARKET
Miami DDA-Residential Market Trends Update (2010 Q2)
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The inventory of new, unsold condominium units in the downtown area was estimated at approximately 5,400 units as of June 30, 2010. As shown below, nearly half of the remaining unsold inventory of new units in the downtown area is in the Brickell area. The CBD accounts for 23% of the overall downtown inventory of new unsold units. This count does not include units in the Mint and Paramount Bay projects. Construction of these buildings is effectively complete, but sales have not commenced to date. Both buildings were part of the Corus Bank portfolio acquired by Starwood. The development pipeline of new condominiums in the downtown area beyond the above noted buildings includes less than 300 units in several partially completed buildings.
Completed/Unsold New Condominium Units by District Downtown Miami Study Area, June 30, 2010 Brickell
2,607
CBD
1,241
Park West
432
Media & Ent.
388
Wynwd/Edgwtr
761 0
500
1,000
1,500
2,000
2,500
3,000
Source: Miami‐Dade Co. Public Records; Focus Real Estate Advisors, LLC.
EXHIBIT I.5 UNSOLD NEW CONDOMINIUM UNITS BY DISTRICT RESIDENTIAL LEASING VELOCITY AND RENTAL RATE TRENDS
Average monthly residential leasing velocity in the downtown area increased from 342 units per month during the first quarter of 2010 to 376 during the second quarter of 2010, representing a quarter over quarter increase of approximately 10%. Leasing activity during the first six-months of 2010 was up 14% from the first six months of 2009 from a monthly average of 315 units in 2009 to an average of 359 units per month in the first half of 2010. Average monthly unit rental rates and per square foot rates are illustrated in Exhibit I.7. The average monthly rental rate for units rented during the second quarter of 2010 was $1,805, up 2% from the first quarter 2010 average of $1,766. However, the average rent for leases executed during the first six months of 2010 ($1,787) was down approximately 1% from an average rate of $1,806 during the first six months of 2009.
Miami DDA-Residential Market Trends Update (2010 Q2)
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Sales and Leasing Activity Downtown Miami Study Area, June 2009 through June 2010 900
Leases 800
336
Sales
364
700
Units Absorbed
600 387
375
380
399
381
342
348
365 329 318
500
332
486 439
400 339
300 200
248
279
330
268
262
234
203
310
338
254
100 0
Source: MLxchange; Realist; Goodkin‐Focus Strategic Alliance.
EXHIBIT I.6 DOWNTOWN MIAMI STUDY AREA LEASING VELOCITY
Average Residential Rental Rate Trends Downtown Miami Study Area, June 2009 ‐ June 2010 Monthly Rate
$2,400
Avg Rent Per Sq.Ft.
$2.00 $1.90 $1.80
$2,000
$1.60
$1,800
$1.50 $1,600
$1.40
Rent per Sq.Ft.
$1.70
$1.30
$1,400
$1,791
$1,861
$1,769
$1,739
$1,797
$1,765
$1,724
$1,742
$1,728
$1,834
$1,776
$1,000
$1,608
$1.20 $1,200
$1,748
Average Monthly Rental Rate
$2,200
$1.10 $1.00
Source: MLxchange; Focus Real Estate Advisors, LLC.
EXHIBIT I.7 DOWNTOWN MIAMI STUDY AREA RENTAL RATES
Miami DDA-Residential Market Trends Update (2010 Q2)
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RESIDENTIAL FORECLOSURE ACTIVITY
Residential foreclosure activity by stage of process (pre-foreclosure vs. auction sales) in the downtown area is shown below based on research of public records and associated residential data services. Following the spike in pre-foreclosure activity in March 2010, monthly preforeclosure activity in the second quarter dropped to the lowest levels of the past year. The number of pre-foreclosure filings recorded in the downtown area during the second quarter of 2010 (308) was down approximately 40% from the 504 filings recorded in the first quarter of 2010. Second quarter 2010 foreclosure sales (auction sales) activity also declined about 40% from the previous quarter decreasing from 242 recordings in the first quarter to 144 recordings in the second quarter. Overall foreclosure recordings, including both pre-foreclosure and auction filings during the first half of 2010 were 10% below total activity during the first six months of 2009.
Foreclosure Activity by Stage of Process Downtown Miami Study Area 300
PreForeclosure Filings
Auction 243
Foreclosure Recordings
250 200
202 166
150
130
145 148 141 120
119
114
98
100 61
50
164 149
74 57
61
96
80
70 52
57
66 50
51
43
0
Source: Miami‐Dade Public Records; MLxchange; Realist; Focus Real Estate Advisors, LLC.
EXHIBIT I.8 FORECLOSURE ACTIVITY – DOWNTOWN MIAMI STUDY AREA
Miami DDA-Residential Market Trends Update (2010 Q2)
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