Despite facing challenges like hurricanes and tornadoes, South Florida’s luxury real estate market remains a prime destination for high-end buyers. While the fervor seen in previous years has slightly cooled, the region’s top-tier homes continue to draw attention, with rising prices signaling resilience in this coveted market.
According to a recent report by Douglas Elliman, the third quarter of 2024 saw a continued surge in luxury home prices across South Florida’s exclusive areas, excluding mainland Miami. A total of 137 luxury sales were recorded across six key markets, remaining consistent with last year’s figures. Prices, however, saw a notable rise, climbing 9.6% year over year, even as broader demand showed signs of slowing.
Diverging Trends in Trophy Markets
Florida’s most prestigious markets have seen varied outcomes. Palm Beach, renowned for its high-end real estate, saw fewer but still substantial luxury transactions. The third quarter registered six deals at a median price of $14 million, down from last year’s median of $35 million across four deals. Interestingly, the luxury inventory in Palm Beach has grown significantly, with 54 active listings representing a staggering 180% increase from the same period in 2023. This influx of available properties may provide more options for ultra-wealthy buyers, contributing to the moderation in pricing.
Meanwhile, Miami Beach’s trophy home market told a different story. Active listings shrank by 35%, with nine luxury properties sold at a median price of $23 million, surpassing the median price of $19.8 million from the previous year. Despite a slight reduction in the number of deals, the market’s ability to command higher prices reflects its continued appeal.
Broader Market Dynamics
Beyond trophy properties, Miami Beach’s overall housing market saw a contraction in sales. The number of condo and single-family home sales fell by 23% compared to last year, yet the median price still rose 8.7%, reaching $680,000. This upward price trend was mainly driven by the single-family home market, where the median price surged 16% to $3.5 million.
Palm Beach also demonstrated strength in the broader luxury market, though with some price softening. The median price for a single-family home in the area dipped to $9.3 million, down 35.3% from last year’s high.
One key trend among buyers in these upscale areas is the prevalence of all-cash transactions. In Palm Beach, over three-quarters of all sales were completed in cash, while Miami Beach saw 62% of deals paid upfront. Coral Gables followed closely behind, with 54% of its $8 million median-priced luxury homes sold in all-cash deals. Meanwhile, on the Miami mainland, where luxury prices were relatively lower, the share of cash sales was just 35%.
Condo Market Challenges
The Miami market, especially its condo segment, has softened more visibly. A report by Corcoran noted that condo sales, which make up 80% of transactions, fell by 20% year over year, marking the ninth straight quarter of declining sales. Despite this, prices have continued their steady climb. The median condo price increased by 6% to $622,000, largely due to demand for newer developments in prime locations.
Some areas in Miami have seen sharper price increases. For instance, Edgewater, an emerging neighborhood with a high volume of new construction, experienced a 21% price jump over the past year, despite a 48% drop in sales. Brickell, another sought-after area, saw its median price rise 3% to $655,000, while Downtown Miami’s median price slipped by 1% to $600,000.
Conclusion
Though South Florida’s luxury market may have lost some of its previous momentum, it remains a prime target for affluent buyers. With more properties coming to market and prices continuing to rise, it’s clear that the allure of the region’s sunny shores and upscale living is far from fading.
