November 16, 2016

Stormy Weather for Miami Housing Market

by Anthony Wright

A beautiful home on the Southern Atlantic coast in the United States comes with quick beach access, fresh sea air, and of course… the threat of tropical storms and hurricanes.  

As we in the fenestration industry know well, many buildings codes in the affected areas account for such factors, and include some tough standards for windows and doors to be significantly impact and wind resistant in the event of a storm. And nowhere are these codes stricter than Miami-Dade county, where the local building code requires every exterior opening be sufficiently resistant against the conditions of a hurricane. For window and door makers, it’s an area of opportunity. Miami-Dade certification is a mark of quality, and a region where some of our best technology can be put to good use. Importantly, the Miami-Dade code necessitates both commercial and residential windows and doors be held to the same standard.

And for that reason it’s prudent to keep an eye on the state of the housing market in Miami, which took a significant hit in the month of July. As reported in the Miami Herald, a recently-released report from the Miami Association of Realtors showed that existing home sales in Miami-Dade County fell by 20.8 percent in July compared to just one year ago.

What’s causing the hit? Per the Herald:

Three main factors are conspiring to slow down Miami’s real estate market: Not enough affordable housing for locals. A lack of foreclosure inventory available for investors to snap up. And a major drop-off in the number of foreign buyers, who’ve been burned by the strong dollar.

There’s some silver lining—the slowdown is hitting predominantly sales of multi-million dollar homes and foreclosures, leaving the middle of the market perfectly healthy. Plus, 2013, 2014, and 2015 saw a pretty intense upswing that was never going to be sustainable, according to experts reached by the Herald.

The situation is worth keeping our eyes on, as it could indicate a few things. Without increasing wages in the area coupled with affordable housing, we could be looking at gridlock as potential new home buyers are forced to rent. Consider, for instance, that the total of inventory of Miami homes priced below $300,000 fell 34.3 percent of the last year. It’s no time to panic, but it’s time to pay attention.

Questions or comments? Contact me directly at Anthony.Wright@Quanex.com.
 

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Posted: November 16, 2016 by Anthony Wright Filed under: Miami-Dade, codes, building