December 2015 was another month for homeowners, sellers, buyers, and Realtors in Palm Beach County to be proud of. Increases in closed sales were up over 6% from a year ago in December 2014, but this increase is mostly attributable to new changes in federal lending guidelines that lengthen the mortgage process to 45 days, instead of 30. That law went into effect in October, resulting in a decrease in sold properties for November 2015. Those buyers and sellers who couldn’t close in November closed in December, resulting in an uptick.
The new rules are referred to as the “Know Before You Owe” guidelines, which mostly put into place the requirement for longer times to process mortgage paperwork.
Nationally, this trend was evident with a 14% increase in closed sales, according to a report by the National Association of Realtors. Also nationally, the percentage of all-cash deals dropped significantly, as much as 50%. Going into 2016, the outlook remains familiar: a lack of inventory, and competition among buyers in the $190,000-$250,000 home price range will be steep.
Local housing market trends in Palm Beach County
In Palm Beach County, according to the Realtor’s Association of the Palm Beaches (RAPB), along with an increase in closed sales came an increase in the median sales price to $305,000, or about 11% higher than December 2014. While prices have increased, the median days on the market shrunk to 38 days, which is just a tick higher from November 2015, but more than 30% higher than December of 2014.
Sellers are receiving slightly less in sales proceeds as a ratio of asking price to price of sale. Sellers received an average of $.92 in sales for every $1 asked. That’s about 1% less than November 2015.
Inventory and month’s supply of inventory also showed a marked decrease from year-over year, and month-over-month.
In the condo and townhome market, closed sales ticked up 3.7%, and median sales price climbed 10% from December 2014 to $155,000.
What’s the takeaway? The new lending guidelines are lengthening the days to close from an average of 30 to 45 days, but the only real effect that will have on the market statistics is a rebalancing of how the numbers are recorded. Since the law took effect in October, pushing November’s sales data to be recorded in December, we will begin to see a normalization of how this data is compiled in the first quarter of 2016.
The only practical effect the rule will have on home buyers is that it might complicate their plans to move, or sell and then buy. That’s why it pays to work with a Realtor who has experience in handling both sides of the transaction – so we can help you plan as efficiently for your sale or purchase as possible.
Local Housing Market Data in Palm Beach County
Without further adieu, here are you local housing market data and statistics for Palm Beach County:
|SINGLE-FAMILY HOME||DECEMBER 2015||DECEMBER 2014||PERCENT CHANGE|
|Median Sales Price||$305,000||$275,000||11%|
|Days On Market||38||56||30%|
|List to Sale Price||93.3||92.8||0.5%|
*Data provided by Realtor’s Association of the Palm Beaches (RAPB)