Home Inventory in Hobe Sound Down Another 6%
Last month at this time we reported how inventory levels in the northern Palm Beach County had stabilized after months in a free fall that has brought us to the lowest level of available properties in over 7 years. While they had dropped it was ever so slight and I could not wait to dig into the numbers to see what has transpired since our last report.
Sales throughout the region remain strong with buyers still acting quickly on the best new well priced opportunities while over priced homes and those in poor condition or with location challenges tend to languish. Investor purchases are down about three percent over the past few months as interest rates have jumped to their highest levels in 70 weeks but have pulled back about 9 basis points this week. First time home buyers are thankful for the slight reduction in competition from investors which has allowed a fortunate few to successfully land a contract on the perfect starter home.
If you are a seller, in most neighborhoods and market segments, you are in control and pricing a bit higher than the most recent sales is a prudent marketing strategy. Sales have held steady but vary widely in strength depending on location and price point. The luxury market remains strong which is a good sign while private club communities are still experiencing excess inventory. Over the past 30 days pending home sales in the area have declined pointing to lower sales numbers ahead.
More and more homeowners are finding themselves with positive equity as prices have risen although Florida still ranks the 2nd highest in the nation, behind Nevada, with 31.5% of all mortgaged properties still “underwater”. Keep in mind that cash sales account for about 50% of today’s sales and as prices climb so will the number of homeowners with equity.
The Fed has an important meeting coming up next week as we all wait with baited breath on more news on just what changes will be made to the quantitative easing stimulus package. While unemployment numbers dropped to 7.3%, the lowest level in almost 5 years a little digging shows weakness in quality job growth. It is going to be very, very interesting to see what the Fed does and how it will affect the real estate market which has been the brightest star in the overall economic recovery sky.
So let’s take an in depth look at changes in home inventory in Hobe Sound and the surrounding areas since our last update on August 12th. Last month in this report we reported further drops in available homes but is was very slight at .5% so let’s take a closer look at what has transpired since then and how it will affect buyers as we move forward.
This report shows our home inventory “power rankings” for the month starting on September 1st. These rankings are set up so the top rated municipality will be the one who shows the highest overall reduction in inventory levels. Since it is these reductions, when coupled with stronger sales, that will continue to move prices higher we want to rank those accordingly. So here are the inventory power rankings are the rankings for the month that ended on August 31st.
#1 Juno Beach –
#2 Hobe Sound – down 6%
#3 Tequesta – unchanged
#4 Palm Beach Gardens – up 1.3%
#5 Jupiter – up 5%
Last month we had 80% of our reporting municipalities show further declines in available home inventory with only Juno Beach showing an increase. Overall the northern Palm Beach County region showed further inventory declines with the average falling by another 2% and the median decrease weighing in at 0.5%. This month we had half of our communities showing further declines in inventory, half showing increases and one with no change at all. Add it all up and overall we had another decline of 1.54% but are seeing more volatility which bears watching. We next move in this months report to home inventory in Hobe Sound where inventory levels fell for the 5th straight month to a new 7 year low. As of September 1st, total home inventory in Hobe Sound sits at 241 which is down another 15 units from the 256 we had on August 1st. With these levels we find ourselves with home inventory in Hobe Sound down 19.5% from the 12 month average that now sits at 299.08. Looking at the “seasonal” factor we are also down 25% from the level of home inventory in Hobe Sound hat we reported on September 1st of last year.
Watch for news out of the Fed next week and if they deem the overall economic picture continuing to mend watch for higher interest rates heading your way.
Fins up until October ………