Miami Home Sales Hold at 3-Year High

About 2.8% of the homes sold in December had been "flipped" within a three-week to six-month period, meaning they had been bought on the open market and then re-sold within that window. That's down slightly from a flipping rate of 3.1% of all sales in November but up from 1.7% in December 2008, based on public records. Flipping rates were higher before the housing market correction: In December 2005 the Miami-area flipping rate was 4.5%, while it was 5.0% in December 2004.

Buyers who appear to have used cash to purchase their homes accounted for 54.0% of all December sales, and those buyers paid a median $120,000 for their homes. Specifically, these were transactions where there was no indication of a purchase loan recorded in the public record at the time of sale. Some of these "cash" buyers could have used alternative financing arrangements outside of a typical purchase mortgage, and in some cases these buyers might be taking out mortgages after their purchases. All-cash deals are popular in markets where prices have dropped sharply and sellers favor the relative speed and certainty of cash transactions.

The use of adjustable-rate mortgages ("ARMs") to buy homes was steady in December at 5.7% of all purchase loans, the same as in November but up from a decade low of 4.4% in May 2009. However, December's purchase ARM level was down from 6.9% a year earlier. Miami's monthly average for ARM use over the past decade is 49.7% of purchase loans. In December, the median ARM purchase loan amount was $280,000.

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