Writer: Caty Hirst
2 min read January 2022 — Miami’s housing market continues to boom into 2022, with everything from apartment rentals to purchases of luxury homes seeing all-time highs, despite a lack of available space and escalating prices.
Miami’s metro area saw a surge in apartment rentals in 2021, according to Marcus & Millichap’s third quarter report, with over 5,100 units rented from April through June of that year, the strongest quarter reported in over two decades. Rents are also increasing rapidly — up by 24% in some neighborhoods just last year — mirroring the surge in demand and causing further affordability issues in an already at-risk market.
Miami-Dade County’s home sales soared 142.4% in year-over-year data from 2021, jumping to 11,553 sales, according to Norada Real Estate Investments. The report also shows that single-family home median prices rose 31.6% year-over-year to $500,000.
A forecast by Realtor.com ranked the housing market of the tri-county area of Miami-Dade, Broward and Palm Beach at No. 61 for 2022, with an expected 9.4% combined jump in sale prices for 2022 as well as an estimated 3.6% increase in the number of sales and a 5.8% increase in housing prices.
Miami is also forecast to be the strongest luxury housing market in the world moving into 2022, ahead of Los Angeles and Sydney in terms of highest value growth. The Knight & Frank report shows luxury property prices expected to grow an additional 10% in 2022, with Florida’s low tax environment, Miami’s competitive pricing and the appeal of the beach ranking as top reasons for the competitive market.
The booming housing market is also being driven by post-pandemic trends, as remote work opportunities lead people to search for homes with plenty of outdoor space and favorable weather. In tandem, the Miami Downtown Development Authority’s Follow the Sun campaign is incentivizing companies and individuals to relocate to Miami. Through the campaign, the development authority is offering businesses with at least 10 employees that intend to relocate or expand in the area the possibility to receive up to $50,000 per year.
To meet the incredible demand, new apartments continue to hit the market. In a deal announced in January, for example, Related Group is partnering with Merrimac Ventures to develop a new condo tower within the Miami Worldcenter. The development, The Crosby, will be a 33-story, 450-unit condo tower with prices starting in the $300,000s.
And in a new crunch for the area’s real estate market, Miami-Dade is beginning to see a dip in home sales in the areas most vulnerable to sea-level rise, according to researchers publishing in the National Bureau of Economic Research. For example, the luxury housing market of Bal Harbour, located just outside of Miami, saw prices begin to tumble beginning in 2013. Researchers say they have identified a decline in total home sales and sale prices located in low-lying coastal areas, compared to less vulnerable land where sales and prices have continued to grow.
Still, some factors may cool the hot housing market in 2022 — namely increased supply, higher interest rates forecasted throughout the year to beat back inflation and a return to in-office work.
