The "Miami Boom" is a Mirage: Why the Million-Dollar Listing Narrative is Dangerous for Buyers

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If you’ve been reading the real estate headlines lately, you’ve likely seen the viral claim: "Miami has officially dethroned New York City as the capital of luxury real estate."

The headline is based on a flashy statistic from a recent Realtor.com report, which notes that for the first time, Miami has more active listings priced over $1 million (~10,600) than New York City (~10,200).

On the surface, this sounds like a victory lap for Florida. It paints a picture of unstoppable wealth migration and a market so hot that it has eclipsed the financial capital of the world.

But if you dig into the actual data, this narrative falls apart. In fact, this isn't a sign of a booming market—it is a classic signal of a market in distress. Here is the truth that the brokers aren't telling you.

1. High Inventory is Not "Dominance"—It’s Indigestion

The report frames the high number of million-dollar listings as a badge of honor. In reality, inventory count is just a supply metric. Without context on demand (sales volume), supply tells you nothing.

When you have record-breaking inventory, it can mean one of two things:

1. The Good Scenario: Builders are rushing to meet insatiable buyer demand.

2. The Bad Scenario: Homes are sitting on the market because nobody is buying them.

The data for late 2025 suggests we are firmly in the second scenario. Listings are "accumulating" in Miami not because the market is healthy, but because the exit door is clogged. Homes that would have sold in days in 2022 are now sitting for months.

2. The Price Drop No One Mentions

If Miami truly "dethroned" NYC due to overwhelming demand, prices would be skyrocketing. Economics 101 says that high demand + limited supply = higher prices.

Instead, the opposite is happening.

According to independent market data from December 2025, median home prices in the Miami area have actually dropped by approximately 10.8% year-over-year. You do not see double-digit price corrections in a "booming" market. You see them when sellers are forced to face reality.

3. The "Seller Delusion"

So, why are there so many million-dollar homes for sale? Because sellers are still pricing their homes based on yesterday’s headlines.

There is currently a massive gap between List Price (what sellers want) and Sale Price (what the market will pay).

• Sellers are listing homes at $1.2M, hoping for a bidding war.

• Buyers are offering $950k—or staying on the sidelines entirely.

• The Result: The home sits on the market. It becomes a statistic. And then a reporter counts it as proof that Miami is "richer" than NYC.

The Bottom Line

Don't confuse a "crowded shelf" with "high sales." A store with full shelves isn't necessarily successful—it might just mean no one is buying the product.

Real estate brokerages and portals have a vested interest in keeping the "FOMO" (Fear Of Missing Out) alive. They need inventory to move. But as a buyer or investor in 2026, you need to look at the absorption rates and the days-on-market.

Miami is not "beating" NYC; it is currently struggling to find liquidity. If you are buying now, ensure you aren't paying a "luxury capital" premium for a market that is actually on sale.