Our team is committed to customer service and your experience, every step of the way
Cash is King in Miami
The Miami real estate market is in a world of its own compared to the rest of the country. In 2013, Miami led the United States’ real estate markets in all-cash deals and was followed by Las Vegas and New York, according to data compiled by RealtyTrac, a real estate research firm. Compared to the national average of only 31%, approximately 62% of all closed residential real estate sales in Miami in 2013 were cash deals, according to the Miami Association of Realtors and the National Association of Realtors.
Downtown Miami Skyline
Miami Condos
In 2013, 74% of all condo sales in Miami-Dade County were cash transactions, according to the Miami Association of Realtors. What does this mean? This means that buyers cannot play the “low-ball” game…in Miami, this mentality does not work. When most buyers are paying cash, sellers are less likely to allow cash to influence their decision to take a lower offer because they know that another all-cash offer may be right around the corner. When buying a condo in Miami, financing is the biggest obstacle for most buyers. Obtaining financing on a condo is very difficult regardless of your personal income or credit…I CANNOT STRESS THIS ENOUGH! This is precisely the reason for the high level of cash buyers. If you are not able to put 25% – 30% down on a Miami condo, financing is almost impossible to obtain.
Luxury Home in Miami
Miami Homes
Miami single-family homes differ slightly from the Miami condo market. In 2013, 46% of all single-family homes were purchased using all cash, according to the Miami Association of Realtors. Although this number is not nearly as high as cash condo sales, it is still 50% higher than the national average. Financing is much easier to obtain when purchasing a single-family home versus a condo in Miami. Where 25% – 30% down is required with a condo, you can purchase a single-family home with as little as 5% down…unless the purchase price exceeds the conventional loan limit…which is a completely different story.
There are various reasons why all-cash offers rule the Miami real estate residential market.
Some tips for all-cash buyers in Miami
Don’t get me wrong, cash is king…but not when everyone has it! As reported by Diana Olick of CNBC on Friday, June 24, 2014, “All I know is that at least 80% of new or pre-construction condos today go to foreign, all-cash buyers with 50% deposits in Miami.”
If you, or someone you know, would like more information on Miami real estate or simply have a question about the Miami real estate market, please contact Michael Light of Miami Luxury Homes. You can reach me directly at my office 305-350-9842, on my cell phone at 786-566-1700 or via email at michael@miamiluxuryhomes.com.
This post from onqfinancial.com takes you step by step through the process of how to get an FHA loan.
Learn more about The Light Group
Get access to our exclusive weekly "Insider" newsletter on everything Miami!
The Miami Luxury Homes A-List
Join 5,000+ current subscribers and sign up to receive our weekly newsletter!
We will NEVER share your information
Explore Miami & Miami Beach Communities