July Home Sales in North Palm Beach Drop Another 27%
That old time machine just doesn’t stop and keeping up with duties has put me a bit behind on my articles so am thankful for a long holiday weekend to play a little catch-up. The action on the front lines of the South Florida real estate market continues to amaze with shrinking inventories and higher prices across the board. Over the past few weeks it seems the market is pausing a bit to catch its breath but sales have remained strong with well priced new listings in good condition getting immediate offers. More often that not these premier new opportunities have multiple offers within a day or two. Buyers must have a well designed game plan and be prepared to act quickly to be successful in landing the best deals.
Most of our active inventory that has been on the market for more than a week tends to be priced higher than the most recent comparable sales or the property has location or condition issues. Sellers are counting on prices continuing to rise while buyers are hoping for a pull back to assist them in meeting their goals with interest rates climbing. The good news is rates have pulled back from new highs this week as everyone is watching closely what the Fed does with it’s quantitative easing program. This program has been in place for almost 5 years and was designed to keep interest rates artificially low. For now the Fed sees the overall economic picture strengthening enough that they will start tapering their purchases with hopes they can end the program by June. Time will tell but the reality is rates are probably heading higher.
How higher interest rates will impact the market is a double edged sword. Climbing rates will entice some buyers to jump in before rates go much higher but as rates continue to hit news highs many buyers can be priced out of homes they could afford just a couple months ago. This balancing act still relies on inventory levels which dropped in our region by .5% last month compared to previous monthly drops of 7.8% on 7.2%. We still see strong investor and other cash purchases as first time home buyers continue to be frustrated battling against investors with cash on hand. To put this in perspective over 50% of all home purchases in Jupiter over the past 6 months have been paid for with cash.
As we do each month it is time to see where sales levels of single family homes have been on a local level. Home sales in North Palm Beach and the neighboring communities have remained very strong strong so let’s look in to the numbers and see what happened during the month ended August 1st.
Hobe Sound –
Palm Beach Gardens –
North Palm Beach – down 27%
Last month in this column we reported that 60% of our reporting communities showed weaker sales with a spread of 36% between the best and worst performing municipalities. This month we again have 60% of our communities showing a decline in sales but this month the spread was much greater at 77%. The main culprit is inventory and highlights just how localized the real estate market truly is. Jupiter sales remained somewhat flat while to their north in Tequesta sales soared by 50% while their southern neighbor of Palm Beach Gardens had sales levels that dropped by 26%.
We begin this months report with home sales in North Palm Beach that dropped by 27% on the heels of last month’s decrease of 21%. This number is a new 6 month low and again partially due to inventory levels that continue to decline in the area. During the month of July a total of 8 North Palm Beach single family homes sold compared with 11 during the previous month. With this showing we fell well behind the 12 month average sales volume which currently stands at 11.92. On a “seasonal” note home sales in North Palm Beach also ended far lower than the 12 sales we had in the same month in 2012.
As we saw sales volume decrease in North Palm Beach we saw the heaviest activity in homes priced between $150,001 and $500,000 with 5 sales representing 62% of the market. Also strong were homes with sales prices above a million dollars with 3 sales and 38% of the market. With this showing the median sales price increased to $387,500 up 9% from last months number of $355,000. We stayed just above the 12 month average which now stands at $371,149. From a “seasonal” perspective we remained well above the median sales price from July of last year which came in at $300,000 Below are the charts showing the percentage of single family home sales in each category for the month of July as well as median prices over the past 12 months in North Palm Beach.
As we say goodbye to summer this weekend we look forward to continued strength heading in to the fall months. Fins up until September………..