MIAMI (CBSMiami) — South Florida homeowners have something to rejoice about: higher property values.
CBS4 news partner The Miami Herald reports the S&P/Case-Shiller home price index, released Tuesday, indicated home prices in the area rose 4.4 percent in June.
The June increase is when compared to June 2011.
Nationally, single-family home prices also showed solid improvement, with the annual growth rate turning positive — 1.2 percent — for the first time since 2010 when federal tax credits were fueling sales.
Also bolstering signs that the residential market is finally on the upswing, prices in Miami-Dade, Broward and Palm Beach counties rose 1.6 percent in June from May, and they were up 0.7 percent in the second quarter from the first quarter, according to S&P/Case-Shiller.
The widely monitored report tracks sales of thousands of single-family homes.
South Florida, which was among the hardest hit spots in the nation during the housing crisis, chalked up its seventh straight month of rising values in June. That is the area’s longest positive streak logged since 2006.
Despite the recent gains in prices, South Florida home prices are still down 48 percent from their 2006 peak.
“There is a lot of pent-up demand, a lot of enthusiasm at open houses,” said Lisa Dority, an agent with REMAX/Advance Realty. “I don’t know that I’ve had a house on the market for more than three weeks.”
Along with rising confidence that the market has bottomed, buyers are attracted by the historically low mortgage rates. “You can get a 30-year fixed-rate mortgage for 3.625 percent with no points,” said Ron Rosen, a mortgage broker with Abacus Lending Group in Miami. “It’s been very active.”
Lucy and Alex Arrieta expect to close soon on a three-bedroom, two-bath house in Aventura with an attractive FHA loan. The Arrietas, who have three children, are moving from a condo to a single-family house with a pool, capping a yearlong search. “We’re tired of looking,” said Lucy Arrieta, who with her husband had waited months to complete a short sale that eventually fell through.
Ron Shuffield, president of Esslinger-Wooten-Maxwell in Miami, said a primary factor shaping the market continues to be the tight inventory of homes for sale at a time that buyers are feeling convinced the housing market is safe to jump into again.
“When you get down to a four or five months’ supply [of homes for sale], it’s inevitable that prices will rise,” said Shuffield. “Buyer confidence is increasing, making people willing to make these deals.”
Despite the dearth of inventory, agents say buyers have a keen sense of the market and overpriced homes will sit untouched.
“The new inventory that is coming on the market priced correctly is selling,” said Nancy Klock Corey, who manages Coldwell Banker’s Miami Beach office. “There is a percentage of inventory on the market that is not saleable because it is overpriced.”
Jon Mann, an agent with The Jills team at Coldwell Banker, said the latest Case-Shiller data echo what he sees in the market. But Mann stressed that the Miami market is highly segmented, with homes in the downtown and coastal areas posting gains, “but down south and out west, you’re still seeing a continued decrease in home values.”
On a national basis, the latest Case-Shiller data were positive for all three major indexes the firm tracks — national, 10- and 20-city lists — in June. The national composite price rose 1.2 percent in the second quarter from the year-ago period and increased 6.9 percent from the first quarter of 2012.
“The combined positive news coming from both monthly and annual rates of change in home prices bodes well for the housing market,” David M. Blitzer, chairman of the index committee at S&P Dow Jones Indices, said in a statement.
All 20 of the cities tracked saw average home price increases in June from May. Only six cities – Atlanta, Chicago, Las Vegas, Los Angeles, New York and San Diego – still showed negative annual rates of change, according to the report.
While the Case-Shiller report focuses on single-family homes, the South Florida condo market, which is a major part of the region’s housing scene, is also back from the dead.
Maria Gugliotta, a Miami real estate investor, bought a one-bedroom condo at Paramount Bay at 2020 North Bayshore Drive for $395,000 in November 2011 and sold it about a month ago for $520,000. “But I don’t think you can stretch the rubber much more,” said Gugliotta, who thinks condo prices have gotten so high the math for renting them as an investment soon won’t add up. “Miami is beautiful. It’s full of opportunity, but it ends. [When prices get too high,] it’s not an investment anymore.”