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Scorching prices continued to dominate Palm Beach County’s home sales last month with the average single-family home topping $1 million in a market choked by freakishly high demand and low inventory.
The median sales price also burned up pocketbooks countywide at $535,000, 19% higher than last year and a 47% increase from the pre-pandemic days of February 2020, according to a report released Friday by the Broward, Palm Beaches and St. Lucie Realtors group.
While Palm Beach County’s average sale price has surpassed $1 million four times in monthly housing reports dating back to March 2021, Realtors said the repeat bounce above six figures and median prices above half-a-million are representative of the desperation they see in the market.
“We’ve got 10 buyers for every house,” said John Sholar, a Keyes Company Realtor. “I had an open house on Super Bowl Sunday where 65 people came and I got 14 offers.”
The two-bedroom, one-bathroom Super Bowl house south of downtown West Palm Beach was listed for $795,000. It’s under contract for $935,000, Sholer said.
Sholar points to the increase in companies relocating to Palm Beach County as one reason for the raging demand. No state income tax is another.
“New York, Chicago, Connecticut; that’s where we are seeing a lot of buyers from,” he said.
March, April and May of 2021 saw average home prices of between $1.031 million and $1.045 million, according to the Realtors group. December hit $1.007 million with February’s average single-family home going for $1.016 million.
The number of active listings for single-family homes was down 40% in February from the previous year. At the same time, homes went under contract in 13 days, down from 30 in 2020, and a majority of buyers are paying at least the list price.
The median percent of the original list price received was 100% in February.
Friday’s report noted the average price for a Palm Beach County condominium was $498,589 in February, which is up 14% from last year. The median price was $275,000, an increase of 16.5%.
Median prices are often preferred by market experts over the use of average prices because the average can be skewed higher by a handful of luxury property sales. The median price is the midpoint where half of the properties sell for less and half for more. It isn’t as sensitive to over-the-top mansion sales.
“I just listed a property for $6 million. There were multiple bids and the final price under contract was $1.15 million over asking,” said Boca Raton-based Bonnie Heatzig, executive director of luxury sales at Douglas Elliman in South Florida.
Heatzig said the market is nearing an “impasse” because of the lack of inventory.
“Occasionally a new property comes up when someone is relocated out of state or an older person transitions to an assisted living home,” she said. “If something does come together, it might not be the right fit, but buyers are ready to strike.”
The number of February single-family home sales in Palm Beach County was up 2% over the previous year, with condo sales up 19%.
Cash sales were completed in 45% of the single-family home purchases and 64% of condo deals.
In the Treasure Coast, Martin County’s median single-family home price was $522,500 in February, up 24% over February 2021. St. Lucie County’s median home price was $350,000 last month, an annual increase of 27%.
Ned Murray, associate director of the Perez Metropolitan Center at Florida International University, said buyers today are trapped as prices rise even in areas that have previously acted as outlets for boom markets.
“It’s not like you can just go north or west and find something because everywhere has become very, very expensive,” Murray said in an interview earlier this month. “Martin County is now as expensive or more expensive than Palm Beach.”
Murray said the answer is to build more supply, but even that is fraught as developers face higher construction costs, supply chain shortages and an uncertain future.
The Eastpointe community in Palm Beach Gardens has had about 65 homes for sale on average in the past. On Thursday, it had two, said Victoria Lorusso, a Realtor with Echo Fine Properties who lives in Eastpointe.
She said when a Canadian developer announced it was buying land in the community to build 75 new homes, 500 people got on a waiting list without seeing plots or home models.
“It can be a stressful market,” said Lorusso, who recently had a home go under contract in two days for $115,000 over the $750,000 asking price. “The clients were skeptical I would get the asking price. It closed in two weeks.”
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