Tequesta Area Home Inventory Shrinks for 3rd Straight Month

Is the “protracted slowdown” heading our way?

The Fed has spoken; Janet Yellen has appeared in front of the United States Congress and told them the recent housing slowdown “could prove more protracted” than expected. Seems the national concern is fewer households forming and actually the numbers are quite shocking. I always take government numbers with a grain of salt but these figures are certainly disturbing to the real estate world. According to the Census Bureau new household formation for the 12 month period ending on March 31st was 423,000. Compare that to the average formations of 1,300,000 for the period between 2002 and 2006. Less than a third of the households we had been creating back in the good old days.

Inventory

The blame they say is the fact that more and more young adults are living at home with their parents to cut expenses while struggling with record levels of student debt. No doubt this generation is going to have to learn how to cut expenses rather dramatically. After all, we already have them strangled with 17.5 trillion dollars in debt and never showed any concern for doing anything but spending more. And more. And more.

We have been very fortunate here in southern Florida as we play by a special set of rules. We are certainly not 100% isolated from macro economic news. We do however enjoy far higher levels of real estate activity from baby boomers, investors and international buyers which provides a boost most markets do not enjoy.

Over the past month we have published information showing the rise in single family home prices leveling off after a steep 5 month climb. Condo prices in the region were the opposite showing nice gains over the past month after a 6 month period of price erosion. Prices are typically determined by the interaction of supply and demand and one metric of incredible importance to future price movements is inventory levels. We know these numbers are so incredibly important that we publish them twice monthly and keep our current clients updated even more often.

As this months chart shows we have seen inventory levels in Tequesta and the neighboring communities fall for the 3rd straight month. Great news which is the supply side of the price equation and should help boost prices even higher in the days ahead. As of May 15th the number of properties available for sale in the northern Palm Beach County region are 3% lower than where we stood 30 days ago. Inventory levels are still about 5% higher than they were one year ago but we are heading in the right direction.

Another one of our mid month updates will be heading your way so watch for our next article where we see what has happened to the number of homes under contract since April 15th. Always interesting, always fun.

Fins up………..

Tom Priester
Principal Broker

Paradise Sharks Real Estate
Direct Line 561 308-0175
tom@tompriester.com

http://www.paradisesharks.com

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Tom Priester

After spending years among the top individual performers at one of Palm Beach County’s largest and most successful real estate brokerages, Tom Priester knew there was another way to do real estate. A better way. Real estate services focused on the customer. Like the old days when the customer truly was #1. He tired of listening to why he should be going out to have his customers sign one sided buyers’ brokerage agreements. He tired of hearing how he should be selling customers why paying higher commissions, like 7% and 8%, was to their benefit. He tired of hearing how he should sell his clients on why they should be paying hundreds of dollars in additional “transaction fees”. The business had slid way too far from being focused on the customer. His customer. So he decided the time was right to be different…..by design. To start his own unique boutique real estate firm truly focused on his customers. They will now have access to a process focused on them. Only the best marketing techniques to sell their homes. No cutting corners. Commission structures based on his clients needs not his. Paradise Sharks was born out of Tom’s passion to return this business to the customer. Where it belongs. If you want a real estate experience that benefits you, just give Tom a call at 561 308-0175 or send him an e-mail at tom@paradisesharks.com. You can always pay more and receive less but that just would not make any sense. Would it?

3 thoughts on “Tequesta Area Home Inventory Shrinks for 3rd Straight Month

  1. Housing prices in decent neighborhoods (imho) are too high today. Families, parents can’t afford to move or buy. Inflation and no one wants to talk about the fact that wages (or dwindling jobs) haven’t kept up with the ever increasing homes, insurance, hoa fees, autos, food, utilities.

    1. Len,

      There is no doubt about it; we live in interesting financial times. I was working for a developer in 2005 and was vocal to anyone who would listen that I thought it was a most excellent time to sell. We did just that and rented for over 6 years before jumping back in a couple years ago. Nothing makes sense these days and that is why we watch the market very, very closely so our clients have the most complete information on which to base any decision. It is also one reason our value oriented brokerage is doing so well. In the end we will be in an inflationary or deflationary period like we have never seen before in the United States. The question is which and when. If it is inflationary hard assets like real estate should do very, very well.

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