September 2022 Market Report for Palm Beach County – By Amy Snook

There are many variables that make September results interesting! The final results and evaluation of the next few months are going to be critical to really ascertain and give guidance on our Palm Beach County market.

 

First, the week leading up to now, Ian, as you can imagine, caused a pause in most of Florida’s market – the path of the Hurricane was unclear and therefore most sellers and buyers chose to wait before taking any action on their real estate decisions.  Further, for any buyer under contract to close on a home in September, if they had not yet bound their new insurance policy, insurance agents were unable to complete the process therefore causing closings to be delayed. The above skewed, of course, new listings coming on market, buyers going under contract and closings for the month of September.

 

Another variable, though may also be the trend for our future, is that we are back to season in our market.   Historically and prior to our pandemic years, we saw a drop off in summer months and the market did not typically pick back up until we approached our season – October, November timeframe. For the past 3 years or so, we were strong 12 months of the year with many people desperately wanting to relocate or purchase a second home in south Florida.  The lifestyle we offer in Palm Beach County fueled the real estate market.  With September’s results showing a decrease in almost all categories across the board, we need to wonder if we are back to “seasons” of real estate in Florida or were we simply impacted by the Hurricane.

 

Yet another aspect is mortgage rates. Cash sales were down again this month which means more people are financing the homes they are buying.  With interest rates higher than we have seen in many, many years and the threat of continued increases in those rates, we know that people are looking at lower price points than they did one year ago, and others are simply not able to purchase or purchase what they want and are holding off for now.

 

All three (3) of the above variables impacted our September results, we will be closely monitoring the next few months to really ascertain whether we are back to prepandemic market seasons and how much the interest rate will impact our unique market.

 

With all of that said, Noreen and I had a very busy September with both listings and buyers going under contract. I share that because I do think it is worth mentioning – when homes are priced properly, and buyer expectations are also set upfront – homes move.     People still want to sell and people still want to buy but realistic expectations are critical and the market is clearly indicating this fact.

 

In EVERY price point which we evaluated, months of inventory crept up by at least one month – $600- $900 and then $1,000,000 and up – is officially in a balanced market – for $1,000,000 we are actually approaching (on the cusp) a buyer’s market – but from a recommendation perspective of our team – we caution anyone to get too confident and treat the $1,000,000 and up price point as a balanced market.  Too many factors impacted September results to change strategy at this point; however, we currently have the most inventory at every price point over any month in 2022.

 

I hesitate to share specific numbers as almost ¼ of our month was impacted by the Hurricane (Ian) and we don’t feel that these numbers are truly an indication of where our Palm Beach market truly stands – cash sales down, median and average price points down, new listings and new pending are down as well and inventory was up almost 68% from this time last year.

 

All of the above said, we are extremely confident that our market is still very, very attractive and is a highly sought-after place to live, work and play.  While this month we experienced a shift, we believe it was a temporary shift (as to the degree of which we shifted).   We will not continue, at this time, to see unsustainable growth in price points but we will see properties moving at price points higher than the pre-pandemic times.

 

Our greatest advice in this market, choose your real estate partner wisely😊

 

Amy

July 2022 Market Report for Palm Beach County – By Amy Snook

Based on June numbers, our Palm Beach County July market report is proving to be very interesting. If you watch, the media is touting doom and gloom for real estate around the country – and while things have definitely slowed from the frenetic pace that we’ve experienced over the past few years, the Palm Beach real estate market is far from doom and gloom. In fact, as we’ve stated in our past reports these last few months, when marketing properly and priced appropriately, homes are selling…period!

HOWEVER, our reality is that the market that “was” is not the same now. That market was unsustainable, and we all needed it to soften a bit. Inventory was lacking at all price levels but we now have more inventory! Demand is still high and with inventory increasing, Buyers have more choices. Now more than ever, when Buyers have options, Sellers need to pay more attention to how their home looks, how it is priced, and how it is marketed. If you have been reading our reports you know that one of the leading indicators of the market is inventory – if nothing new came to market – how many months would it take to “consume” all that is available – you also learned that a balanced market is 5-7 months of inventory; below 5 is a seller’s market and above 7 is a buyer’s market. While under $999,000 is still a Seller’s market – our months of 1 or 2 months of inventory has now reached 3 and 4 months of inventory – inching towards a balanced market. Over $1,000,000 – is sticking at 5 months – low end of balanced but nevertheless balanced.

So, what makes this interesting? Well, as expected, the higher interest rates have cooled the market (at varying price points), certainly hasn’t stopped the market but rather slowed it down. For the first time within the past year, June results show that year over year results have declined. As it relates to closings, last June happened to be higher than normal but we cannot ignore the fact that the astronomical increases have ceased. Closed sale numbers are similar to pre-pandemic numbers; however, prices are up substantially.

In Palm Beach County, prices remain strong but the price points are responding to the increase in inventory. There are simply more options for people. Driving around we see more signs – we see more price reductions – we have more competition.

 So, Buyers, this is the first month in sometime that we are reporting good news – there are more properties!

Sellers, it continues to be very good news for you as well. Buyers are still relocating to our area! Price properly, ensure marketing is firing on all cylinders and ensure you partner with a Realtor or Team who knows how to get you to the closing table. Given that there is more inventory, buyers may exercise their right to cancel under inspection. Experience and Finesse is needed to keep deals together .

Looking for the right partners? The Amy and Noreen Team of Lang Realty are ready to spend time with you, educating you on the market and rolling up our sleeves to continue doing what we do best!

Latest Market Report – January 2022 Results for Palm Beach County

It’s the same ol’, same ol’ this month in the South Florida real estate market.

Once again, a low inventory of listings and an abundance of would-be buyers continues to make it a red-hot sellers’ market.

How will the forecast of increased interest rates change that, if at all? How will the war in Ukraine affect the U.S. real estate market, if at all? And now that America seems to be finally emerging from the Covid-19 shutdowns, will the influx of buyers into our Palm Beach County market continue?

These are questions that we are being asked daily from our clients and friends and while none of us have a crystal ball, we do feel our years of experience will help provide some insight.

Every month, we created a spreadsheet and conduct an analysis of the numbers of our market versus the rest of the state.

For example, our market is unique and usually differs from the reports summarizing the rest of the state and other price points across the nation. If you watch the local news, or follow real estate reports, a one-month inventory of the state lists a median sales price of $350,000. Palm Beach County’s median price, however, was $526,000 in January and our average price was $826,000. The huge differential is due to the number of seven-figure homes for sale which we have in Palm Beach County.

For those new readers to our report, understanding “months of inventory” is crucial. That term means a hypothetical that if no new homes were added for sale, how long would it take for every home for sale to be sold?

The statewide average inventory in January was one month, but in Palm Beach County homes under $999,999 is two months, but for over-$1,000,000 it has increased from December to January from three to five months, which was a needed increase toward a more balanced market.

Our Palm Beach market still attracts many new homeowners seeking our beautiful winter weather and outdoor lifestyle. Thousands more employees are working from home these days, which means they are free to relocate but still hold the same job. Also, thousands more are buying second homes in South Florida. We do not see this slowing down any time soon.

Some say that the market is softening when they see a price reduction in a home.

However, to us that just meant that agents had overpriced the homes to begin with. They were overpriced, even in today’s terms, and sat on the market. If you price your home right however, it will attract a buyers’ frenzy.

So, what does our future hold?

We believe that the upcoming increase in interest rates will have only a moderate impact in our market – mostly with the lower price points. But on $800,000 homes and above, we will continue to see mostly cash transactions. In fact, in January, there was a 30 percent increase in cash transactions from the same time a year ago.

We will have would-be buyers find properties — and emerge as the actual buyer should a bidding-war ensues against others who want the same home. And that is happening now more than ever. Should you want to sell and take advantage of this super-hot market, we also know how to price and market your property effectively to capitalize on all these factors.

We would love the opportunity to discuss your personal situation and what is best for you.

 

Amy Appears in the Sun Sentinel — 2022 Home Prices

Check out Amy’s interview in this Sun Sentinel article about home prices in 2022!
“It’s already increasingly difficult for home buyers to land a home in this market, as many offers that are contingent upon financing are overlooked,” she said. “What I’ve been seeing is a lot of people who have been waiting out this past year are now selling their homes to capitalize on the low inventory market and they are renting now.”
https://www.sun-sentinel.com/real-estate/fl-bz-home-prices-forecast-south-florida-2022-20211202-en5pdrtoxbdwbjphwzcxmm7pj4-story.html?fbclid=IwAR2qnxXlHc_pPQFU4VYL-O4mLk_qR5YzzSv4HOD6ROlYr01ndEpRYPPmyCM

MARKET REPORT: April 2021

 

With the highest medium and average sales prices that we have seen in over a year and  inventory weighing in at record lows, April 2021 rang in an unprecedented time in real estate. A surefire indicator of market conditions, 6-9 months of inventory is considered a balanced market. Under 6 makes for a Seller’s market, and over 6, a Buyer’s market. The average inventory in Florida today across all price points is 1.8. That’s right, a mere 1.8! Never fear, however, hope isn’t lost for the motivated buyer in Florida.

Whether you’re a buyer or seller, this market calls for strategy. To approach real estate with a recipe for success, you must account for the ingredients at hand.

Here’s the bread and butter of it: cash sales are up significantly in Palm Beach County, according to the April 2021 Florida Realtors report. It’s important to remember “cash sales” doesn’t always mean green: but instead, that the transaction was not contingent upon financing.

 So, for our seller’s out there: you’ve got high probabilities of a cash offer coming your way. Now, does this mean you shouldn’t accept a finance offer? Not in the least! It means that Sellers are empowered to “demand” certain elements should you accept a mortgage. Such as a quicker loan commitment— meaning the contingency for finance ends faster (including appraisal and loan conditions). You can also weigh your options on whether to allow an appraisal contingency— for the right buyer, omitting this step may suit just fine, and the finance offer can move forward.

As for buyers? It’ll be key to keep in mind that you’re competing against cash offers— so offers need to be written aggressively, and with the least amount of contingencies. That said, it’s important to ensure you’re protected as well; and in that, a good agent will make all the difference.

Now factors aren’t the same across all price points. April’s market sweet spot is the $400-599k price point. In this turf, homes are selling in a stunning 8 days. That, compared to the 1,000,000 plus market, which is an average of 27 days to contract. So if you’re selling a home at $500,000, your price is right, the place is properly staged, and sports curb appeal? Well, you’d better start packing!

Buyers—I’m sure you’ve read your fair share of stories on scarcity, that homes just can’t be found. We’re here to tell you that they absolutely can! Simply put, you’ll need three tricks to compete in this market: an aggressive offer, the preparation to write it quickly, and a partnership with the right agent who has your back and your interests in mind.

Sellers— are you scared to sell because you haven’t yet pinned down where you’ll go next? Not to worry, we have a plan for that. Let’s partner up to sell your home and gain you the most we can, while holding space for a strategy that allows you time to find the right home for your needs. It’s a Seller’s market out there, and you’re in the driver’s seat for both your sale AND your purchase. Sit down with Noreen and I of the All About Florida Homes team of Lang Realty, and we’ll put the priorities of you and your family front and center to build you a strategy that feels the perfect fit.

 

Buyers Waiting for Prices to Come Down Will Be Disappointed

“Some buyers were waiting for the next recession, thinking home prices would fall again – but recessions aren’t created equal. The latest downturn exposed those myths.”- FloridaRealtors.org
 By: Russ Wiles

NEW YORK – The current economic downtown has been odd in so many ways. Why shouldn’t it expose some economic myths and misconceptions as unreliable, if not outright untrue?

When it comes to understanding the relationships involving home prices, bank deposits, interest rates and unemployment, many disconnects arise. Here are a few:

High unemployment and home prices

You might think that as the nation’s unemployment rate has spiked during this social-distancing recession, that would put pressure on home prices, forcing some owners to miss payments and discouraging buyers.

So far, that hasn’t been apparent. Home prices were up 2.5% on average this year through April, according to S&P CoreLogic Case-Shiller.

Low interest rates, which make homes more affordable, are one factor supporting prices. Also, stimulus and other government payments have enabled millions of Americans to meet their obligations. Plus, the economic slump has lasted only about four months so far, so the full impact may not have been felt yet. If the economy recovers strongly from here, negative housing fallout might not materialize in a big way.

Still, it does seem like the other shoe could drop. Fitch Ratings, the credit-rating agency, currently sees home prices nationally as 6.1% overvalued based on recent price increases, heightened unemployment and the possibility of lower incomes and rents. Values are most frothy in Nevada, Idaho, North Dakota, Texas and Arizona, Fitch said.

The degree to which housing might become more overvalued depends on the future path of unemployment and personal incomes, said Suzanne Mistretta, a Fitch senior director.

The company sees the U.S. unemployment rate easing to 7.8% next year from an average 10.3% in 2020. Though not approaching overvaluation levels of 20%-plus from 2005 to 2007, housing still could reach its highest level of overvaluation in a decade, Fitch warned.

Federal deficits and interest rates

Many people used to assume widening federal deficits would exert a crowding-out effect, pushing interest rates higher as the supply of debt mushroomed and private savings were siphoned from other investments. Few people seem to be focused on this connection anymore, given that interest rates keep dropping while Washington’s borrowing needs continue unabated.

One explanation for why the link doesn’t seem to work is the lack of inflation, as inflation and long-term interest rates tend to move together.

Another is the preference among investors for owning government bonds, which carry high credit ratings, during periods of heightened uncertainty. When things get tough, investors get nervous. They snap up government bonds with preservation of capital, not yield, as the primary goal.

As the Tax Foundation noted in a 2016 report, some economists had been suggesting that budget deficits reduce economic growth by boosting interest rates and diverting private saving toward the purchase of government debt. But in practice, “It has been hard to find an empirical link between deficits and increased interest rates or reduced investment,” the group concluded.

Rates are even lower, and deficits higher, today.

Low yields and deposit accounts

You would think that with bank deposit accounts, money-market mutual funds and other risk-averse instruments yielding next to nothing, investors would be ready to move their money elsewhere. But so far, millions of people are willing to accept virtually no yield so long as their assets remain safe.

Bank deposits spiked by $1.2 trillion in the first quarter, the most recent figure tracked by the Federal Deposit Insurance Corp. That was nearly four times the size of any other quarterly deposit gain over the past decade. Americans also have been flocking to money-market funds and other risk-averse instruments. Money-fund assets are up more than $1 trillion so far this year, reports Money Fund Intelligence newsletter.

It’s not like risky stock-market investments have been faring all that poorly. The broad market was up roughly 43% from its recent low in late March through July 9. But for a lot of people, safety reigns supreme – and they’re willing to pay a price for it, in low returns.

College graduates and layoffs

Before the recession, the vast majority of people with bachelor’s degrees who wanted jobs could get them. As recently as March, the national unemployment rate for college graduates was 2.5%. That was well below comparable figures for less-educated Americans, such as the 4.4% rate for people with only a high school diploma.

College graduates also typically earn more – $1,248 a week on average for holders of bachelor’s degrees only, compared with $746 for those with a high school diploma only, according to a May update by the Bureau of Labor Statistics.

However, that picture has changed a bit amid this coronavirus-induced economic slump. The unemployment rate for college grads more than tripled overnight to 8.4% in April and 7.4% in May before easing to 6.9% in June, according to the Department of Labor.

That’s still well below comparable rates for less-educated groups, such as the 12.1% June unemployment rate for high-school graduates. (The department also tracks workers based on whether they have some high school attainment and some college.)

Still, it lays to rest, at least temporarily, the notion that college graduates are immune from layoffs or other career bumps, especially amid an economic backdrop as strange as this one has been.

Saving money during recessions

You might think now would be a tough time to save money. During recessions and other periods of high unemployment, more people are financially stressed, the reasoning goes. It would be the time for many individuals to lean on their savings to help make ends meet.

That might be the case for a lot of people, but it certainly doesn’t tell the whole story. The nation’s savings rate often has climbed during recessions, and while real-time numbers aren’t available yet, that could be the case again.

Part of this might reflect a reluctance or lack of opportunity to spend money. Think how much you have saved in recent months by eating at home rather than at restaurants, not taking vacations and so on. Perhaps many people also are making a genuine effort to get their budgets under control by putting off various types of spending.

It’s not just individuals, either. A March survey of corporate finance officers conducted by the Association for Financial Professionals noted the largest increase in three years of businesses holding short-term investments at banks.

 

https://www.floridarealtors.org/news-media/news-articles/2020/07/buyers-waiting-prices-come-down-will-be-disappointed

How We Can Work with Clients During this Challenging Time!

  It is hard to say what our future will look like in real estate or for that matter anything in our world, post this pandemic. While there is a lot of “bad” to focus on, I am really trying to focus on any positives that may come out of this time.   I am certain for many of us, the time at home with our children, has provided us with opportunities that we most definitely did not prioritize in the past. Realtors are constantly “on” – responding to clients, conducting searches, showing property, coordinating towards closings, educating ourselves, sharing information with our clients and prospects and so on.    So, to “have” to slow down has been actually wonderful.

I am spending time doing things with my son that I just hadn’t found the time – we played checkers, twister and even taught him how to cook (even though it is most definitely not my forte).

As for business – when I slow my mind down and really pay attention to the calls we are receiving – I realize that our clients, friends, prospects DO rely on us for real estate guidance.   I think this has always been there, but I just didn’t slow down to realize it.

Today a prospect called and asked us to list one of his homes for rent.  He had been listed as for sale by owner and hadn’t received calls – the truth is for this one, I analyzed how he was marketing the home and his price point and gave him guidance rather than taking the listing.  Why? Because his margins are very tight and I felt that I could help him without his having to pay an agent for this rental – so he reduced to the number I suggested based upon comps and I had him reorder his photos, remove some photos, alter his write up and voila – the phone started ringing. 

We are here to help – give guidance, be supportive, educate and be a resource for all.  As a thank you for helping him with his rental listing…. And unbeknownst to me…he has another property that he wants us to put up for sale.

For my fellow Realtors, be a trusted resource, offer guidance, continue your education so you can continue to be an expert.  Now is the time when you can create some blogs, record videos, etc. and work to share your knowledge.

By: Amy Snook

From Florida Realtors: Landlords are Finding Security Deposit Alternatives

“Families that can barely afford rent find it challenging to pay a security deposit and moving costs. As a result, fewer landlords are requiring an upfront deposit.” “NEW YORK – Renters find that fewer places charge a security deposit – good news for tenants but a source of stress for landlords. Security deposits have traditionally […]

Selling a home in Delray – Should we accept a buyer’s contingent offer?

We received this excellent question recently:

 

Our house has been on the market for awhile and now we have an offer.

But, it’s contingent upon the sale of the buyer’s home. What does this mean? Should we accept it? It’s the first offer we’ve had in a few months, so I’m thinking yes. Help!

 

Our advice would certainly depend on a lot of factors, but it’s a maybe!

If your home has been on the market for awhile and it’s not a seller’s market in your home’s price bracket, you don’t want to unilaterally just pass on this – it could be a great opportunity.

We’d want to ask some more questions… Can we work with that buyereir offer to a place that works for both parties? Also, is their home on the market? Is their home under contract? If so, we’d want to look at that contract. We would need to understand how strong their offer is.

There are times that we’ve represented buyers that came forth with an offer like this. It wasn’t our listing, and guess what? We got to the closing table – because we know how to get our buyers to the closing table. In this case, the agent on the other side needs to be helpful, too. So, we also look at who that agent is… because that does make a difference, and we are often familiar with that agent.

There’s a particular clause in the contracts here in Florida called a “kick-out clause.” If it’s a buyer’s market, you as a seller may or may not want to consider that. Basically this clause says,

“I’ll take your offer and it’s contingent upon the sale of the home, but I’m leaving it active. I’m taking backup offers, and when I get an offer you’re going to get first right of refusal. If you still want this house, then okay, the contingency’s gone, this house is yours.”

This can be helpful, as it gives the buyer some protection. If she or he is not in a position to own both homes, this offer can be accepted, subject to the above –  a win-win for a buyer and a seller.

The most important thing to know is that every scenario is different, so you want to be sure you are working with the right Realtor… a team that can give you guidance and help you make the right decision for your specific situation.  There are a lot of factors to come together to create the right deal! (That’s the part that we love! It’s the the fun part!)

We’d love the opportunity to help you through scenarios such as this, and to get you to the closing table. Contact us at (561) 571-2289 for a no-obligation consultation!

Selling Boynton home: Do we need a pre-listing inspection?

A social media friend sent us a question recently. He wrote: 




We’re going to sell our Boynton Beach home soon. I’ve been hearing recently that sometimes home owners who plan to sell pay for a pre-listing home inspection. What is the benefit? If we sell our home, do I need one?

I will answer this question the way we answer a lot of our questions lately – with “It depends.” Here’s why:

In a perfect world, we’d always like to see a pre-listing inspection so we know what issues may exist. It can be incredibly helpful.

The benefits:

If you, the seller, are the first to know of any items that may show up in inspection, you can work with us to develop a strategy around how to handle those issues. We can decide what we want to fix in advance. We can learn the costs needed to repair some of the bigger, more complicated items. Being informed helps us to better negotiate.

Ideally, the issues do not end up impacting the listing price or the selling price. But it’s good to be prepared and pre-think whether we are open to offering a credit, and/or if we plan to make repairs.

In a scenario in which you have an older home that maybe needs a lot of work – or when we know we’re going to have inspection issues – it’s actually imperative so we know what we are actually dealing with.

But, it’s not realistic to have a pre-listing inspection in every scenario. We look at our clients’ needs on an individual case-by-case basis. To help you make a decision about this, we look at factors like the home’s age and condition (as mentioned), the price point, the hyper-local market conditions, and your personal timeline and goals.

 

We often begin to discuss this in a pre-listing consultation appointment. We’d love the opportunity to work with you and help guide you through the process of listing and selling your home. Please call us anytime – Amy and Noreen, All About Florida Homes, Keller Williams Realty –  at (561) 571-2289.

And, if you’d like us to provide you with a free, on-obligation home value estimate, head here to request it:
https://amyandnoreenteam.com/home-value/