What has changed in a year? Our Real Estate Market Report for April 2018, one year ago, showed Closed Sales as essentially flat, a topped-out Median Sales Price for single-family homes at $350,000, and dwindling Active Listings and New Pending Sales.
So far this year, Median Sales Price remains flat at $350,000, indicating that the robust home value appreciation in our county may be coming to an end. Since 2015, median sales price has grown by about 30%, with the majority of that growth coming before 2018.
One could interpret this data as a sign of market stabilization – that is, buyers and sellers have established an equilibrium, which occurs when supply closely matches demand. That should be welcome news for both sides of the transaction. For sellers, it means we are likely not in another real estate bubble; for buyers, it serves as a reliable baseline.
Further, homes in the price range of $300,000 – $399,000 accounted for a whopping 20% of all closed sales in April 2019. Consider that homes between $600,000 and $999,999 actually dropped by thirteen percent, and you have your explanation for why Dollar Volume was about 6 percent lower than it was last year.
It certainly seems safe to assume that $350,000 is our “new normal” for median sales price for the foreseeable future, with modest increases of 1.5% – 3% appreciation in the years to come.
Deals are taking longer to close, and here’s why
Median Time to Contract rocketed upwards by 30% from 42 days to 55 days. At Copeland & Co., 84% of our listings are sold within 30 days.
So, what could explain a 30% increase in the median time to close on a real estate transaction? We posed the question to Catherine Steward, owner and closer at Pegasus Title Services. “I’ve found that, generally, most delays result from lender-related issues”, she said.
“Specifically, I have found that many properties are now appraising below the contract price compared with this time last year. This can result in the parties having to renegotiate the contract, which adds days to closing”, said Steward.
What appraisals mean for you
If you are a buyer, an appraisals that comes in below the contract price is a good thing. The lender will only fund the loan up to the appraisal value. If the seller wants to keep the deal alive, they’ll have to negotiate the price, or you as the buyer will have to come up with the difference in cash.
For sellers, appraisals that come in above asking is not necessarily a bad thing. It will open a re-negotiation, but we see very few deals sour because of it.
Median Percent of Original List Price Received describes the relationship between the price a home is listed for, and the price it closes at. County-wide, that average is 9.4%, while at Copeland & Co., 98% of our homes sell at the listing price or higher.
Once thing we can be sure of – our Realtors at Copeland & Co. Real Estate beat the market’s averages!
No local real estate company brings you the detailed analysis and insights in the Palm Beach County real estate market like Copeland & Co. If you are looking to buy or sell, why would you hire anyone else? Give us a call at 561-500-LIST (5478) or shoot us an email to hello @ cpld.co (with no spaces!)
Here are your stats for April 2019.
April 2019 Single-Family Real Estate Market Stats
|SINGLE-FAMILY HOMES||APRIL 2019||APRIL 2018||PERCENT CHANGE|
|Median Sales Price||$350,000||$350,000||0%|
|New Pending Sales||2,087||1,895||10%|