With its endless white sand beaches, lakes and waterways, Palm Beach County is one of the best places to live in the country. The beautiful county has something for everyone, from suburban gated communities to rural ranches.
Palm Beach County has been rapidly expanding its real estate, thanks to a growth in population. The 2018 summer was unusually slow for the county’s real estate but in fall, we are likely to see new listings and real estate sales ramping back up.
Palm Beach Home Sales
Palm Beach’s existing condo sales are once again the reason for the overall home sales increase in the fall season. Condo sales increased by 19.2% from 901 transactions in October 2017 to 1,074 in October 2018. Condos priced from $50,000 to $250,000 comprised 65% of sales in October 2018, making it a significant increase from October 2018.
Meanwhile, Palm Beach’s single-family home sales increased 15.6%, from 1,261 to 1,458 in October 2018. The majority of the sales were of homes priced between $250,000 to $1 million and saw the selling of 999 homes.
In fact, the Palm Beach single-family luxury homes valued between $1 million and above reported 60.9% growth from 2017, with 111 transactions made in October 2018.
Seller’s Market for Palm Beach Real Estate
According to Miami Realtors, inventory of single-family homes increased from 6,948 in October 2017 to 7,108 in October 2018. Condo inventory also increased, but to a much lower degree, from 6,016 to 6,022 in October 2018.
If the market is balanced between buyers and sellers, it would offer between 6 and 9 months supply of inventory. However, the monthly supply of single-family homes remained the same as last year at 4.8 months, indicating a seller’s market. Additionally, existing condos have a 5.2-month supply, which further points to a seller’s market.
Mortgage Rate Affecting Local Buyers
As expected, mortgage rates have started rising and reached 4.83% in October. The National Association of Realtors along with CoreLogic has reported that the average rate on a 30-year loan will reach 5.1% soon, which is the highest in a decade. For homeowners, the rise in mortgage means tighter market for refinancing ahead. Higher mortgage rates also mean more expensive homes for buyers. Every time the rate rises, a section of the potential buyers are kicked out of the market because they become ineligible for loans.
However, don’t let that scare you. The mortgage rate isn’t the only thing that matters when buying a home. An increase in the average commitment rate on a 30-year, conventional, fixed-rate mortgage does not have a huge impact on your monthly payment. For example, on a 30-year loan for $200,000, the monthly payment would be about $95 more at 4.8% interest than at a 4.0% interest rate.
In Palm Beach County, home prices are being driven up by a combination of factors, including higher wages, strong job market, lack of new home constructions and influx of millennials moving out of apartments. What is for sale in most areas is getting multiple offers from prospective buyers and is going under contract quickly.
Currently, we are at a very interesting time where it makes sense to both sell and buy a house. If you are looking to do either one, it is necessary that you contact Paige Hails Realtor so that you can make an informed purchase decision — and in the process, save thousands of dollars.