March 2023 Market Report – February 2023 Data For Palm Beach County – By Amy Snook
A client recently asked us to forecast our local real estate market over the next year. My initial thought was to look at the trends that impact our typical real estate market such as supply, demand and inventory. However, in today’s environment there are many other factors to consider such as: interest rates, inflation, the banking crisis, politics, global threats, stock market, etc.. We are currently in and believe will continue to be in for a bumpy ride, simply put, there are too many variables at this time to forecast one year out. Even when running comparables to determine a list price or for a buyer’s offer, we can’t go back even six (6) months to compare as too much has shifted in the market.
From a trends perspective, we are tracking more in line with the pre pandemic (2019) market where we could plan for seasonality and all of the familiar nuances of our Palm Beach county real estate market.
Trends aside, today we are still in a lower inventory market than we were pre pandemic, but of course are almost double where we were just one year ago. New listings in Palm Beach county have slowed, most likely for several reasons:
- Many people are locked in a better interest rate for their current home mortgage and if they have to finance their new home, it would be at a higher interest rate.
- We realize how great we have it here in Florida – so many residents are simply staying put.
- If you sell, where would you go if you are in the under $1,000,000 price point? – inventory is still low.
The good news from the February results just released is that the softening we experienced when the Fed started increasing rates is having less of an impact. Rates on a 30 year fixed loan came down slightly earlier this year and that fueled buyers’ activity once again resulting in an increase of closed sales in February. With more homes being closed but still with a lower number of new listings coming on, this change has shifted our months of inventory at almost all price points below one million.
This shift brings us back to a stronger seller’s market under $600K and a more balanced market up to the one million dollar price point.
Over one million in Palm Beach county continues to remain just under twelve (12) months of inventory making it a strong buyer’s market. However, with low inventory and high demand for the Florida luxury market, our prices have been more stable reducing slightly versus a steep decline.
This month I want to address the condo market in south Florida. By now you have probably read or heard about the upcoming changes to ensure structural integrity and adequate reserves for condos that meet certain criteria such as proximity to the coastline and number of stories in the building. The changes do not fully take effect until December 31st, 2024 however, the impact of the changes are already being felt. The condo market is absolutely going to be a case by case analysis by building – and we as Realtors need to understand what questions to ask so that we can better advise our clients on what to expect from a construction perspective in the building to potential special assessments. It is important that consumers align with Realtors who are versed in these changes and the financial impacts associated. Many current homeowners are faced with increasing dues and current and future special assessments. We are in for a very interesting condo market over the next few years.
Our current market is changing often so analyzing the results is even more critical and breaking out by price point and product (condo versus single family as an example) is essential to providing worthy guidance to our clients. At The Amy and Noreen Team we continue to keep up with the rapidly fluctuating market and are here to help in any way!
Amy
Fun Events In Palm Beach County In March – Presented by Noreen Payne
Want to know what top events are happening in Palm Beach County in the month of March 2023? Listen to Noreen Payne’s video overview. Join us every month for highlights of top events in the area! Call us with any questions at 561-571-2289
January 2023 Market Report – December 2022 Data for Palm Beach County – by Amy Snook
January 2023 Market Report – December 2022 Data
It is frustrating as can be when you watch the news or read the newspaper and the media summarizes what is happening in our Palm Beach market – I believe it is over-simplified and all price points are lumped together presenting an inaccurate assessment. How can sellers and buyers make an educated decision of when to sell, when to buy, how to price, etc. without fully understanding the total environment in our community? It is for this reason that we take the time every month to analyze the numbers, the trends and the issues impacting our local market.
This month’s market report reports the results of our final month in 2022 – the December market report and we believe will be eye-opening to many sellers and non-seasoned agents. First, the media reports 3.2 months of inventory for Palm Beach County – while this is true at the $300,000 price point, it could not be further from the truth at the $1,000,000 price point, which is showing 10 months of inventory. This stark contrast between average and breaking it down at price points is what is causing many in the community to improperly price their listings. Three months of inventory is a strong sellers’ market – and we have learned over the past three years that a strong seller’s market can provide a setting of the Wild Wild West with multiple offers, waiving of contingencies and an all-out frenzy. On the contrary, 10 months of inventory, as evidenced in our higher-end market is a completely different environment and one that gives the buyer the leverage, which is the antithesis of our experience over the past three years. The $400K through $999K presents a balanced market, one in which neither sellers nor buyers have an advantage.
It is for this reason at our higher-end market that we are seeing homes sitting for much longer since buyers have more options now from which to choose. We also have sellers and Realtors alike who have not yet acknowledged that our market has softened. It is difficult to properly price a listing today because there isn’t a history of comparables that tell a realistic story. You have to understand the market and where we are headed to price a listing and even then, you have to really listen to the market’s feedback and adjust. Realtors, we have to once again spend money to make money. For those of us who saw this coming and saved our money, we are in a good position to market our listings. Mostly everyone does professional photography, but should add to this video marketing, print advertising, social media paid ads, postcards and good old-fashioned smiling and dialing to others in the industry. Sellers, you need to be prepared that your home will take longer to get under contract with the median time to reach a contract doubling year over year.
As we closed out 2022, we acknowledged new listings are down but inventory is up more than 120% from the same time last year, which is great news for our economy. Median and average sales prices are NOT up, however. They are down significantly from the same time last year. We are blessed that our Palm Beach County is a destination location with second homes, vacation homes and even remote workers keeping our market protected from the huge swings many other areas of the country have seen. In fact, I just attended the Florida Realtors convention in Orlando and heard their economist, Dr. Brad O’Conner, speak about 2023 trends and he was optimistic about what the year will bring, barring any catastrophic unexpected events.
The graphs showing 2022 results are much more comparable to those pre-covid. We once again have seasonality in Florida real estate – we are heading back to “normal.”
Our advice to sellers: You have to be fiercely competitive with the others home-sellers on the market. There are lots for buyers to choose from – to stand out from the crowd – not just in price but in curb appeal and how your home is marketed and shown. Price it strategically, but not unrealistically. If you are interviewing Realtors, ask how they plan to market your home. Of course, price is one facet and you and the agent together should determine the price based upon many factors. Price can change, but how hard a Realtor works to sell your home is critical. Remember, you need to stand out from the crowd and be a fierce competitor!
Amy
One Of The Many Things We Do For Our Listings!
Don’t just imagine what your dream backyard could look like…see the potential! Here is one of the many things we do for our listings. Contact Amy and Noreen for more information at 561-571-2289.
One Of The Many Things We Do For Our Listings!
Don’t just imagine what your dream backyard could look like…see the potential! Here is one of the many things we do for our listings. Contact Amy and Noreen for more information at 561-571-2289.
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