Miami Beach Real Estate Market Prices, Trends, and Forecast 2023

Miami Beach Real Estate Market Prices, Trends, and Forecast 2023

Miami Beach is popular with vacationers and long-time residents alike for its proximity to endless water recreation, fine dining, and stunning Art Deco architecture. Miami Beach is an attractive place to live for its access to large, sandy beaches and clear turquoise waters. Residents can walk across the city with an oceanside view along the Beachwalk, play a game at one of two public golf courses, or visit one of the 44 parks in the area. Dining is also exceptional, with upscale options, including two Michelin-starred restaurants. Spanning seven miles, this town is the epitome of relaxed and luxurious living, so it’s easy to see why the city’s real estate market is booming. Although market trends in the area are cooling, high demand and low inventory keep median home prices high, and these trends are reflected across all of Miami-Dade County.

Miami Beach housing market

The Miami Beach real estate market is experiencing cooling trends, which will likely persist throughout the rest of the year. Properties spend a median of 91 days on the market, which is a slight increase compared to last year. The number of price drops for homes and condos also rose considerably compared to last year. Home sales in the area have decreased by 31.03% in the past 12 months, while condo sales have dropped 40.46%. All of this is to say prices are still at an all-time high, so should you find yourself navigating the real estate market, you’ll want to keep up with any changes in local trends.

Local market indicators

Buyers entering the Miami Beach real estate market can count on declining home prices when starting their search. However, they should look out for rising interest rates that bite into purchasing power. Those who have found themselves out-priced in today’s market are shifting gears to renting, leading to favorable conditions for landlords and investors.

Declining home values

The median property value in Miami Beach is $441,300. This is a 3.86% annual decline.

Increasing interest rates

The average monthly mortgage payment for a buyer in Miami-Dade County with a 30-year fixed mortgage is $2,423. This is a $1,025 increase compared to last year’s monthly payment of $1,398. Buyers have less power when it comes to financing — and budgeting in — a mortgage loan, making it harder for first-time buyers to enter the market. The average interest rate in Florida for a 30-year fixed loan is 6.94%, while 15-year loans average 6.18%.

Investing indicators favor landlords

Landlords have plenty to look forward to when investing in a rental property. 63% of the housing units in Miami Beach are occupied by renters, creating ample demand for landlords. In the past year, the rental rate for a one-bedroom apartment has increased by 2% to a price of $2,700. The Miami-Dade area is the second most competitive rental market in the nation, only beaten by North Jersey. Available units typically have interest from over 20 prospective tenants at a time, and the lease renewal rate in the county is 70.9%.

Negative population growth

Miami Beach’s population is slowly shrinking. With a population of 89,439, current levels mark an annual rate of decline totaling 0.742%. Investors should keep this in mind when considering long-term demand and reselling properties.

Miami-Dade County market trends

Miami-Dade County is experiencing many of the same trends seen in the Miami Beach real estate market. The total number of home sales has declined 39.9% compared to last year, which indicates less buyer demand in the area. Condo and townhome transactions felt the brunt of this decline, with 46.6% fewer sales compared to single-family homes. Total active listings in the county have increased by 37% compared to last year, as less buyers are on the market. Single-family homes have nearly four months of inventory, while condos and townhomes have nearly five months. However, both of these rates are still staggeringly low and continue to tip the county into a sellers’ market. Despite climbing supply, median prices are still up across all residential property types. Single-family homes have a median sales price of $555,000, while condos and townhomes average $390,000.

The impact of COVID-19

Initially, COVID-19 and its lockdowns hit Miami Beach hard. As a major tourist destination, the city was struggling with high rates of lost revenue and a stalling real estate market. As the country began to open back up and interest rates dropped to an all-time low, many buyers jumped at the opportunity to purchase homes, resulting in a seller-hot market in 2021. However, recent increases in mortgage interest rates have begun to correct the local market.

Why you should invest in Miami Beach

Miami Beach is a great place to invest as a buyer and landlord. People flock to the area for the area’s upscale amenities, gorgeous properties, and incredible beaches. Meanwhile, landlords benefit from a high renter population, an extremely competitive rental market, and plenty of long-term and vacationer demand. The limited shoreline of Miami Beach will continue increasing in value as time progresses.

When diving into the Miami Beach real estate market, check out these top neighborhoods in the area:

South Beach

South Beach is an iconic neighborhood spanning from South Pointe Park to 23rd Street in the north. Art Deco buildings, palm tree-lined streets, and shopping centers like the mile-long Lincoln Road all attract buyers to the area. Other amenities include Lummus Park, the art museum Wolfsonian-FIU, and fine dining at Ocean Drive.

North Beach

North Beach offers a more relaxed lifestyle. Families love this neighborhood for its vast selection of amenities and attractions, such as the North Beach Oceanside Park’s walkway, grassy dunes, and warm waters, and the incredible dining scene around Normandy Fountain. Streets and community spaces decorated with MiMo architecture brighten the area and pave the way for a lively and energetic entertainment scene, which includes music at the Miami Beach Bandshell.

Ready to invest in Miami Beach?

Miami Beach is a sought-after waterside destination full of oceanfront parks, vibrant culture, and quiet, posh neighborhoods for retirees and families alike. Cooling market trends make it a good time to invest in the real estate market, although buyers should still plan on high mortgage interest rates and low housing supply. Whether you’re a buyer ready to purchase a home inside this oceanside haven or a seller ready to take advantage of the Miami Beach real estate market, experienced agent Eliad Cohen and his team of industry professionals at the Eliad Cohen Group can help you reach your real estate goals.

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