Distressed Condo Prices Fall 4% To $234 PSF Average During 2023-24 South Florida Winter Buying Season
A review of the lender-owned condo sales shows that less than 130 REO condos transacted between November 2023 and April 2024.
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Buyers paid about four percent less per square foot for South Florida distressed condos - also known as real estate owned (REO) by lenders - during the recently concluded Winter Buying Season, according to an analysis of statistics compiled by CondoVulturesRealty.com.
Despite the reduced average transaction price of about $234 per square foot, the total number of REO condo transactions also decreased, falling nearly 19 percent on a year-over-year basis in the 2023-24 season compared to the 2022-23 season in the tricounty region of Miami-Dade, Broward and Palm Beach.
For this report, REO condos are defined as foreclosed units that failed to sell at auction and were ultimately deeded over to the lender.
It is worth noting, this report does examine South Florida’s shortsale condo market.
Join the Miami Condo Market Investing Club™ to see all of the charts in this report that analyzes the South Florida REO condo market during all of the Winter Buying Seasons since 2013
The Winter Buying Season traditionally extends from November through April when visitors flock to the tricounty South Florida region of Miami-Dade, Broward and Palm Beach to take advantage of the weather, events and vibe.
Distressed-oriented investors who came to South Florida this Winter Buying Season looking for deals ended up purchasing the fewest number of REO condos in more than a decade.
Buyers purchased nearly 130 condos in the tricounty region in the 2023-24 season. By comparison, buyers bought about 156 condos last year in the 2022-23 season. That is about a 19 percent drop in total South Florida REO transactions.
A year earlier in the 2021-22 season, nearly 200 REO condos traded in South Florida.
It has now been nine consecutive Winter Buying Seasons that REO condo sales were down on a year-over-year basis.
In reviewing the statistics from the last decade, the peak time for distressed condo deals during a South Florida Winter Buying Season was in 2014-15 when more than 3,875 REO units traded at an average price of $135 per square foot.
It is worth noting, a combined total of nearly 13,450 REO condos have transacted during the Winter Buying Seasons spanning from the 2013-14 season through the 2023-24 season. That’s an average of more than 1,220 REO condo transactions per Winter Buying Season.
Since the 2019-20 season, the number of REO condo transactions has fallen dramatically as a plethora of work-from-home employees relocated to South Florida from places such as California, Illinois and New York.
The influx of transplants to South Florida bought up or leased out much of the available housing supply, which increased most condo prices and triggered new development.
Industry watchers are at odds as to the direction of the South Florida housing market in 2024. Bullish investors are predicting housing demand will reignite once interest rates begin to fall. Bearish investors contend that home prices are too high and likely to collapse in the months ahead.