Florida’s luxury residential real estate market has been breaking records with properties selling for never-before-seen prices. However, the overall slowdown in sales has resulted in more price cuts and longer closing times.

Miami Beach is one city where price reductions or discounts are becoming more prevalent, with nearly all $5 million-and-up sales trading at a discount off the asking price. The slowdown in home sales has created a divide between older homes in need of repairs and new or renovated properties, with ...