Our Real Estate Market Report for February 2018 shows a strong rebound in the Palm Beach County single-family home market from December’s lows and January’s lull.
Realtors turned out 1,216 transactions in February, which is almost 5% more than this period last year. Unfortunately for many potential buyers who have been priced out of the market, the Median Sales Price is now $345,000, which is 9.5% higher than February 2017.
For those who have been paying attention, this now marks a full 12-month cycle of real estate market reports in which median sales price has been reported above $325,000.
That is not a bubble. That is now the norm. Property values for single-family homes in Palm Beach County appear to be normalizing. We could see additional top-end appreciation in home values through the end of the year, with our prediction being that media home price this time next year is settled somewhere between $340k-$360k.
How Buyers are Handling Home Prices
Continually appreciating median home prices can be seen one of two ways, and depending on who you are (a buyer or a seller), you might take your pick. Buyers are seeing home prices appreciate quickly and instinctively conclude that the market is over-valued.
Sellers (and, most economists, we believe) would be inclined to conclude that prices are actually normalizing and stabilizing. After ten years of booming economic prosperity following the housing crisis of 2008, the real estate market has come roaring back.
Part of that rebound is the artificially low interest rates the Fed set to spur growth (we did a recent post on the subject here), part of it is housing prices that were so battered that they were bound to greatly appreciate in time, and part of that is continued population growth that is putting pressure on housing availability in Florida.
The biggest mistake we are seeing buyers make right now is ignoring the reality of what their dollar can buy. This is especially true for the many buyers we have that are either re-locating to Palm Beach County, or want to buy a second home.
The fact is that the $1 you could have spent three years ago is not going to get you what $1 can buy you now.
Buying a home you can afford and want in Palm Beach County is already difficult enough if you live here – if you are transplanting, the job is exponentially more difficult. Part of that is the democratization of market data, thanks to companies like Zillow, Trulia, and Realtor.com. But those companies cannot account for other factors that are extremely important in getting the full picture – namely, inventory availability, affordability, buyer competition, and buyer sentiment.
If you are looking for a new home, or if you are re-locating to Palm Beach County, we recommend logging off of Zillow, and calling our Realtors who have boots on the ground.
In the meantime, here’s your full market report!
February 2018 Single-Family Real Estate Market Stats
|SINGLE-FAMILY HOMES||FEB 2018||FEB 2017||PERCENT CHANGE|
|Median Sales Price||$345,000||$315,000||9.5%|
|New Pending Sales||1,785||1,836||-2.8%|