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Tag: Luxury Real Estate

  • The Fed Raised Rates 12–0. Florida’s Million-Dollar Home Sales Were Already Up 8.8%.

    The Fed Raised Rates 12–0. Florida’s Million-Dollar Home Sales Were Already Up 8.8%.

    Graphic reading +8.8%: Florida's $1 million-and-up existing single-family home sales in August 2026, year over year, against a 1.4% decline in all closings statewide, over a stylized city skyline at dusk.

    Statewide closings fell in August for the first time in a year, and Florida Realtors’ own economist blames rates. Above $1 million, they grew. And the Lennar region that includes Florida took the company’s steepest drop in new orders.

    FL Real Estate Insider — Week of September 21, 2026
    By Luis Noronha

    12–0. That was the vote on Wednesday, September 16, when the Federal Open Market Committee raised the federal funds rate by a quarter point, to a range of 3.75% to 4.00%. (Federal Reserve — FOMC statement, September 16, 2026)

    In July, three members wanted this hike and lost. In September, nobody dissented. (FOMC statement, July 29, 2026)

    In August I wrote that the July statement was “not a committee looking for a reason to cut”. Seven weeks after that July meeting, it raised.

    The same day, Florida Realtors published its August numbers and Lennar reported its quarter, with the earnings call the next morning. Read together — my assessment, not theirs — the three releases test what this newsletter has argued since August. Not all of it held.

    The Fed’s own projections took a 2026 cut off the table

    The decision was a quarter point. The projections are the bigger news.

    The Fed’s Summary of Economic Projections asks each of the 18 participants where the policy rate should sit at year-end. The median answer for 2026 was 3.4% in March, 3.8% in June, and 4.1% on September 16. For 2027 it jumped from 3.6% to 4.1%. (Federal Reserve — SEP, September 16, 2026; June 17; March 18)

    The arithmetic worth doing yourself: the new range has a midpoint of 3.875%. One more quarter point, to 4.00%–4.25%, has a midpoint of 4.125%. A 4.1% median is one more hike across the two meetings left this year, October 27–28 and December 8–9. And the lowest of the 2026 projections is 3.9% — the rate where it now sits.

    Not one participant projects a lower rate by December.

    Chairman Kevin Warsh, at the press conference:

    “I would be hard-pressed to describe broad financial conditions as restrictive. This view was widely shared by the Committee. So we removed a dose of accommodation.” (Federal Reserve — press conference transcript, preliminary, September 16, 2026)

    The same projections put PCE inflation at 3.7% for 2026 and do not reach 2.0% until 2029.

    The mortgage market got there first

    Freddie Mac’s 30-year fixed averaged 6.95% in the week ending September 17 — up from 6.76% the week before and 6.26% a year ago. (Freddie Mac PMMS) In Freddie’s own history file, that is the highest weekly reading since January 2025.

    A scope note, because it changes what the number means: the survey covers Thursday through Wednesday, and six of those seven days closed before the 2:00 p.m. announcement. My read is that the 6.95% mostly reflects the market pricing the hike in advance, not reacting to it.

    Florida’s August: the statewide number went the wrong way

    I’d rather put this first than have you find it.

    Closed sales of existing single-family homes in Florida totaled 21,497 in August, down 1.4% from a year earlier. That ended a run of 11 consecutive months of year-over-year gains. The median held up — $415,000, up 1.2% — on 4.3 months of supply. (Florida Realtors, September 16, 2026)

    Dr. Brad O’Connor, Florida Realtors’ chief economist, was direct about the cause:

    “…on the margin, the recent rise in rates has been enough to slow home sales growth, and the affordability constraints induced by elevated mortgage rates are likely going to be with us for the foreseeable future.”

    And the detail that hurts my own recent argument most: statewide single-family cash sales fell 2.1% — faster than sales overall — to 5,782, and the cash share slipped from 27.1% to 26.9%. (Florida Realtors — August 2026 single-family data detail (PDF))

    Two weeks ago I wrote about Florida’s 41.3% all-cash share and argued that for the cash-heavy end buyer, the Fed is a second-tier variable. That was Realtor.com’s deed data for the first four months of the year; this is Florida Realtors’ MLS data for one month, and the two are not one series. But if the argument were that Florida’s cash buyers carry the whole state through rising rates, August doesn’t support it.

    Here’s the split the statewide headline hides

    The statewide release doesn’t show it. Page 8 of the same PDF does.

    • $1 million and up: 2,087 closings, up 8.8%.
    • $1.5 million to $2 million: up 25.3%. $2 million to $3 million: up 22.9%.
    • $300,000 to $399,999 — the state’s largest single band: 5,443 closings, down 6.1%.

    Everything under $1 million, taken together, fell about 2.4%. That is my arithmetic, not Florida Realtors’: 21,497 total minus 2,087 at $1 million-plus leaves 19,410, against roughly 19,880 a year earlier (21,798 total, less about 1,918 at $1 million-plus, backed out of the 8.8% growth rate).

    Three limits, and each one matters. This is one month. It is existing homes only — it says nothing directly about new construction. And Florida Realtors does not publish a cash share by price tier, so I cannot tell you how many of those 2,087 buyers skipped the lender. I won’t imply it.

    So the Florida market did not weaken evenly in August. My interpretation of why: it weakened where buyers finance and grew where they have the most balance sheet — the pattern the June issue on the Florida luxury buyer described, now visible in a statewide table. Whether that top-tier strength was cash-funded, this data can’t tell me — which is why I’m not scoring the September 9 argument on it.

    What one of the nation’s leading homebuilders said about the middle

    Lennar’s quarter ended August 31. Earnings were $1.19 a share, against $2.29 a year earlier. The average delivered home sold for $372,000, “reflecting approximately 12.0% in incentives, along with base price adjustments.” Gross margin on home sales fell to 15.8% from 17.5%. New orders fell 9%, and the company cut its full-year delivery target to 80,000–81,000 homes from 82,000–83,000. (Lennar — Q3 2026 results, September 16, 2026)

    Lennar reports Florida inside an “East” segment that also includes New Jersey and Pennsylvania, so Florida can’t be isolated. But East new orders were 4,831 against 5,792 a year earlier — down 16.6%, the steepest decline of Lennar’s four regions.

    In my reading, Stuart Miller made my August argument more bluntly than I did:

    “The Federal Reserve’s assistance is clearly off the table for practical purposes and not a near-term source of relief… Rate cuts when they eventually come, will be a meaningful tailwind for our business, but we are not holding our breath… we are not building our business plan around those rate cuts.” (Lennar Q3 2026 earnings call, via The Motley Fool transcript, September 17, 2026)

    He named the competitor, too: resale sellers, with listings “particularly high” in Texas and Florida, “especially at our price range.” On cost, labor “has started to become more of an issue,” citing immigration enforcement — a pressure I wrote about in June’s issue on Florida construction labor enforcement — and competition from data-center construction.

    Lennar’s $372,000 national average falls in Florida’s largest price band, where closings fell 6.1%. My read, marked as opinion: the pressure from rising rates is concentrated where a builder paying about 12% in incentives and a resale seller cutting price are fighting over the same qualified, financed buyer — a fight the top of the market isn’t in.

    From the Developer’s Seat

    From here on I’m arguing, not reporting — the conclusions are mine, drawn from the evidence above.

    The Fed’s own projections show no cut this year, and Lennar’s CEO says the company isn’t building its plan around one; my conclusion, unchanged since August, is that nobody should underwrite a Florida project on the promise of rate relief. Where I’d sharpen my September argument: August’s strength came from the top of the price range, not from cash carrying the state — and in my experience the buyer there is often weighing an older resale house against a code-current new build, the choice I build for. That’s where patient, low-leverage capital has its edge: it doesn’t need the Fed to carry the project, and it builds for a buyer with the balance sheet to close whatever the Fed does. So, a question for anyone allocating here: roughly what share of your Florida exposure depends on a buyer who needs a 7% mortgage to close?

    If you want to see how I stress-test rate and end-buyer assumptions in live underwriting, that’s what the Lana Investor Memo is for.

    → Request access at coastal-living-collection.com (accredited investors only).

    Until next week,
    Luis

    Sources

  • Cash Buyers Are Pulling Back Nationally. In Miami They’re Still 43.2% of the Market.

    Cash Buyers Are Pulling Back Nationally. In Miami They’re Still 43.2% of the Market.

    Graphic reading 43.2% of Miami home sales closed all-cash, the highest share of any major U.S. metro in the first four months of 2026, over a stylized city skyline at dusk.

    Realtor.com’s new report has the U.S. cash share falling and cash transactions falling faster than sales overall. Florida ranks fifth in the country, Miami leads every major metro, and more than 40% of homes sold above $1 million nationally closed without a lender.

    FL Real Estate Insider — Week of September 8, 2026
    By Luis Noronha

    43.2%. That is the share of home sales in the Miami–Fort Lauderdale–West Palm Beach metro that closed all-cash in the first four months of 2026 — the highest of any major U.S. metro in Realtor.com’s cash-sales report released August 18, and down all of 0.3 percentage points from a year earlier. (Realtor.com, August 18, 2026)

    Nationally, cash buying is in retreat. In Miami it barely moved.

    The national retreat is real, and it’s faster than the market

    Start with the part I read as bad news for the cash buyer’s leverage — my read, not the report’s.

    Cash purchases were 31.4% of U.S. home sales in the first four months of 2026, down from 32.3% in the same window a year earlier: a decline of 0.9 percentage points. And the drop in the number of cash transactions outran the drop in the market itself. Total home sales fell 8.5% year over year. Cash sales fell 11.2% — a gap of 2.7 points. Meanwhile the national median sale price rose 0.2%, against 1.8% growth in 2025 and a 15.4% peak in 2021.

    Hannah Jones, senior economist at Realtor.com, put it this way:

    “Cash buyers aren’t disappearing; they’re simply becoming less dominant as the housing market finds its footing. More inventory and moderating prices are giving financed buyers more opportunities to compete.”

    That is the framing I saw picked up in most of the coverage I read, and on the national numbers I think it holds.

    Here’s the table I haven’t seen anyone quote

    Underneath the national number is a state table, and Florida is near the top of it.

    The highest cash shares were Mississippi (47.2%), Montana (45.9%), New Mexico (43.8%), Missouri (42.0%) and Florida (41.3%) — Florida fifth in the country, and 9.9 points above the 31.4% national share.

    The Florida metros:

    • Miami–Fort Lauderdale–West Palm Beach — 43.2%, down 0.3 points, first among all major metros
    • Tampa–St. Petersburg–Clearwater — 35.1%, down 0.5 points
    • Orlando–Kissimmee–Sanford — 32.7%, up 0.2 points
    • Jacksonville — 31.7%, down 1.5 points

    All four sit above the national share.

    Orlando’s went up, against the national direction — and it is not alone. The report has a whole section on markets moving the other way, naming Pittsburgh (up 6.8 points, the largest increase among major metros), Austin, and San Francisco, where cash purchases rose 7.7% year over year. At the other end sit the “high-cost job centers… where mortgage-reliant buyers make up a larger share of purchasers”: Seattle 16.4%, Washington D.C. 18.2%, Denver 18.8%, San Jose 20.2%.

    My read: what matters here isn’t Miami’s level, it’s Miami’s slope. The country gave back 0.9 points of cash share. Miami gave back 0.3 — a third as much, off the highest metro base in the country. To me that reads as a cohort not being replaced by financed buyers at anything like the national rate, though a share movement on its own can’t establish that.

    The tier this newsletter is written for

    Cash is concentrated at both ends of the market — what the report calls a U-shaped pattern. More than two-thirds of homes below $100,000 were cash. And at the top, nationally:

    “More than 40% of homes sold for more than $1 million and a majority of homes sold for $2 million or more were purchased without financing.”

    Realtor.com’s explanation runs one sentence: “At the luxury end, affluent households are more likely to have the resources to purchase homes outright.” In my view that one sentence is the whole thesis of this issue.

    I weight this dataset more heavily than a survey, and it’s worth saying why. The analysis uses recorded deeds back to 2001, and a sale counts as all-cash “when the recorded transaction shows no evidence of a mortgage lien at closing.” It counts what was recorded at the closing table, not what a buyer told a survey panel. One caveat I’d own: no recorded lien is a proxy for cash, not a direct observation of it.

    I read that instrument difference as the main reason 31.4% sits well above the roughly 25% national cash share I quoted in June’s issue on the Florida luxury buyer. That figure was NAR survey data for a single month — MIAMI REALTORS® carried it at about 25% in its June-data release and about 26% in its July-data release — against a four-month deed count here. Different instruments, different windows, measuring the same thing. I should have said so in June.

    What the same market looks like from the financed side

    Freddie Mac’s 30-year fixed averaged 6.71% for the week ending September 3 — up from 6.66% the prior week, and 21 basis points above the 6.50% of a year ago. (Freddie Mac PMMS)

    My read is that the builders selling to that financed buyer are paying for the privilege. The NAHB/Wells Fargo index came in at 35 in August, the sixteenth consecutive month below 40, with 35% of builders cutting prices at an average reduction of 6% and 63% using sales incentives. (NAHB, August 17, 2026) NAHB Chief Economist Robert Dietz, in the same release:

    “Custom home builders continue to report stronger market conditions than spec builders, reflecting better conditions at the higher end of the market.”

    Here is the picture I put together from those two datasets — a construction of mine, not a finding of either source. The NAHB index is national and monthly; the cash shares are Florida metros over four months. Different instruments, different windows. With that said: one business is buying down a rate to close a financed buyer, and the other is transacting with someone who never opened a rate sheet — the buyer I described in June.

    The tables that argue against me

    Four limits, and one of them is the sharpest number in this issue.

    One: Realtor.com does not credit new construction for Florida’s share, and the dataset has no new-build cut at all. The report says plainly that “Florida’s retiree and second-home buyer base supports elevated cash activity.” Not developers. Not new product. There is no new-construction cash share in it — national, state or metro. I looked for one. It does not exist in this dataset, and I’m not going to manufacture one by inference.

    Two: the window closed in April. First four months of 2026, on recorded deeds. Everything since — including a mortgage rate that has gone up, not down — sits outside it.

    Three: Miami’s cash share fell, and on our own preferred series it fell harder than 0.3 points. MIAMI REALTORS® reported Miami-Dade cash at 38.1% of closed sales in June 2026 and 35.1% in July — down 3.0 points in a single month, with single-family cash falling from 27.6% to 21.2%, a 6.4-point drop, and condo cash easing from 48.5% to 47.5%. (MIAMI REALTORS®, June 2026 data · July 2026 data) That is two months of one county on small counts, not a trend — but it is the number a reader with my June issue open will find, so I’d rather hand it to you myself.

    Four: Jones’s read may simply be the right one. A more diverse buyer pool, she says, “is a positive sign for market activity.” “When more buyers can compete using different paths to purchase, the market has the potential to become healthier and more balanced.” My bet, and I’ll call it a bet rather than a finding: a healthier market with more financed buyers in it does not threaten well-located, code-current product.

    One rule I’d ask you to apply to all of the above: don’t blend these numbers. Realtor.com’s 43.2% is the metro, January–April, from deeds. MIAMI’s 35.1% is Miami-Dade, July, from the MLS — and it is a coincidence, not a relationship, that Tampa’s metro figure is also 35.1%. Neither belongs anywhere near the 82% all-cash figure MIAMI publishes for $1 million-and-up condo sales in 2025. Different tier, different year, different product.

    What the July Miami-Dade data does add is the leg Realtor.com’s April cutoff can’t reach: $1 million-and-up sales rose 15.5% year over year, from 341 to 394. Statewide, closed sales of existing single-family homes reached 23,870 in July, up 5.1%, at a median of $425,000. (Florida Realtors, August 17, 2026) That volume closed with the 30-year fixed printing between 6.43% and 6.66% every week of July, and 6.47%–6.52% through June, when those contracts would have been signed. (Freddie Mac PMMS via FRED, MORTGAGE30US) No rate relief in it.

    From the Developer’s Seat

    Everything below this line is opinion — mine, not statute, not data, and not something any source above said. I want that marked plainly.

    Five weeks ago I argued in this newsletter that nobody should underwrite a Florida project on the assumption of Fed relief, and seven days before the FOMC decides, these tables are why I still hold that position. In a state where 41.3% of closings in the first four months of 2026 never touched a lender, and in a national million-dollar-plus tier where more than four in ten didn’t either, the policy rate is a second-tier variable for this segment rather than the master variable. The Miami-Dade single-family cash share falling to 21.2% in July is the number that argues hardest against me, and I’d still hold the position: two months of one county is not a series, and the four-month deed count underneath it is. That is not an argument for ignoring rates — it is an argument about which buyer you build for, and code-current, ground-up new product is exactly what that cash-heavy end buyer is competing over: no unfunded reserves, no deferred maintenance, no financing contingency to blow up three weeks before closing. I’d rather own a smaller, better-built position sold to someone who never needed a lender than a bigger one that only works if the Fed cooperates. My rule is the boring one: underwrite the end buyer, not the rate.

    So — a question I’d genuinely like answered: does the last Florida deal you underwrote assume a financed exit? I read every reply.

    If you want to see how that assumption shows up in live underwriting — the actual end-buyer profile, the actual capital stack — that’s the conversation the Lana Investor Memo exists for.

    → Request access at coastal-living-collection.com (accredited investors only).

    Until next week,
    Luis

    Sources