MIAMI — Palm Beach County existing condominium sales rose in March 2022, according to the MIAMI Association of Realtors (MIAMI) and the Multiple Listing Service (MLS) system.
“Palm Beach County continues to be a top destination for homebuyers relocating from tax-burdened, high-density states,” JTHS-MIAMI President Brad Westover said. “With more fintech companies relocating to South Florida, our region continues to add new-to-market firms and domestic and global homebuyers.”
Palm Beach County Condo Sales Increase in March 2022
Palm Beach County existing condominium sales rose 3.7% year-over-year, from 1,639 to 1,699.
Palm Beach single-family transactions decreased 7.7% year-over-year, from 1,723 to 1,590, because of low inventory. Palm Beach total home sales decreased 2.2% year-over-year, from 3,362 to 3,289.
Palm Beach Luxury Condo Sales Surge 18.4%; Mid-Market $400-600K Transactions Jump Also
Palm Beach existing condo luxury ($1-million-and-up) sales surged 18.4% year-over-year to 148 transactions. Palm Beach single-family luxury transactions increased 6.5% year-over-year to 293 sales in March 2022.
Broward luxury condos boast an inventory of 2.4 months of supply. There are 3.1 months of supply in luxury single-family homes. Luxury months of supply continues to trend downward for all property types because of the robust demand.
Homebuyers leaving tax-burdened states to purchase in Florida (no state income tax), new-to-market firms moving here, low interest rates, the appeal of property as an inflation hedge, rising wages and accrued savings in lockdowns, strong equity market performance, a reassessment of housing needs and lifestyles because of the pandemic and expansion of remote work are all factors driving South Florida real estate demand.
With global vaccinations rising and unstable political situations around the world, South Florida is seeing an increase in foreign homebuyers. Global buyers are coming here for the vaccine and purchasing property.
Vaccinated foreigners were allowed to resume travel to the U.S. back in November 2021 and that is leading to more international investment in South Florida – the No. 1 destination in the U.S. for foreign buyers. Global buyers purchase in Miami because Miami is a world-class global city with better real estate prices than other similar global cities. Foreign buyers feel at home with our incredible diversity and acceptance of all cultures, along with all our amenities.
Palm Beach single-family homes priced between $400K to $600K increased 5% year-over-year to 480 transactions in March 2022. Palm Beach existing condo sales priced between $400K to $600K increased 38.1% year-over-year to 250 transactions in March 2022.
Rising Mortgage Rates Should Eventually Slow Price Growth Nationally, in Broward
Rising median prices is a trend nationwide. Low inventory relative to high demand leads to prices rising. Locally, the greater share of Palm Beach luxury sales over the past year is part of the reason for the large year-over-year increase in median prices.
The Federal Reserve raised rates for the first time in three years in February and has plans for six more rate hikes by year’s end. Mortgage rates have increased this month to near 5%, its highest point in more than a decade.
Home sales and prices from March were not impacted by this recent rise. Many of the financed sales that closed in March had their rates established in January and February when rates were in mid to high 3%.
According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage was 4.17% in March, up from 3.76% in February. The average commitment rate across all of 2021 was 2.96%.
The mortgage rate is projected to land at about 4.5% at year-end 2022, according to NAR. That is still low compared to an all-time average of about 8% in the U.S.
Long term, the hope is higher rates will lead to more days on the market (gives buyers more choices). Higher rates will eventually lead to a moderation of the growth rate of pricing. With the growth rate of pricing cooling, total inventory could grow later. Historically, inventory expands six months after rates rise, but today’s market is unlike any other.
Palm Beach County single-family median prices increased 23% year-over-year in March 2022, increasing from $440,000 to $541,000. Existing condo median prices increased 20% year-over-year, from $245,000 to $294,000.
More Inventory to Arrive Later this Year for Low-Supply/High-Demand Market
Inventory tends to rise in the spring and summer and then it fades in the fall and winter.
Historically in the U.S., total inventory tends to expand six months after mortgage rates begin to rise. A new study by Realtor.com detailed that 64% of possible sellers intend to list their home by October 2022.
New listings of Palm Beach single-family homes decreased 4.4% to 2,144 from 2,049. New listings of condominiums decreased 3%, from 1,921 to 1,864.
Inventory of single-family homes decreased 31.2% year-over-year in March 2022 from 2,718 active listings last year to 1,869 last month. Condominium inventory dropped 61.8% year-over-year to 1,496 from 3,921 listings during the same period in 2021.
Months’ supply of inventory is down since July 2019 for single-family, reflecting strong demand. Months’ supply of inventory for single-family homes decreased 33.3% to 1.2 months, which indicates a seller’s market. Inventory for existing condominiums decreased 70.6% to 1 month, which also indicates a seller’s market. A balanced market between buyers and sellers offers between six- and nine-months supply.
Total active listings at the end of March 2022 decreased 49.3% year-over-year, from 6,639 to 3,365.
Nationally, total housing inventory at the end of March totaled 950,000 units, up 11.8% from February and down 9.5% from one year ago (1.05 million). Unsold inventory sits at a 2.0-month supply at the present sales pace, up from 1.7 months in February and down from 2.1 months in March 2021.
Palm Beach Real Estate Had a $296 Million Local Economic Impact Just in March 2022
Every time a home is sold it impacts the economy: income generated from real estate industries (commissions, fees and moving expenses), expenditures related to home purchase (furniture and remodeling expenses), multiplier of housing related expenditures (income earned as a result of a home sale is re-circulated into the economy) and new construction (additional home sales induce added home production).
The total economic impact of a typical Florida home sale is $90,300, according to NAR. Palm Beach County sold 3,289 homes in March 2022 and therefore had a local economic impact of $296 million.
Palm Beach total dollar volume totaled $2.4 billion in March 2022. Single-family home dollar volume decreased 14.29% year-over-year, from $1.8 billion to $1.5 billion. Condo dollar volume increased 25.36% year-over-year, from $686 million to $860 million.
Palm Beach Distressed Sales Keep Dropping, Reflecting Healthy Market
Only 0.8% of all closed residential sales in Palm Beach were distressed last month, including REO (bank-owned properties) and short sales, lower than the 0.9% in March 2021.
Total Palm Beach distressed sales decreased 15.6% year-over-year in March 2022, from 32 to 27. Short sales and REOs accounted for 0.1% and 0.7% year-over-year, respectively, of total Palm Beach sales in March 2022. Short sale transactions stayed even year-over-year while REOs decreased 17.9%.
Palm Beach’s percentage of distressed sales are on par with the national figure. Nationally, distressed sales represented less than 1% of sales in March 2022, equal to the percentage in March 2021.
National and State Statistics
In Florida, closed sales of single-family homes statewide totaled 30,793, down 6.2% year-over-year, while existing condo-townhouse sales totaled 14,631, down 11.4% over March 2021. Closed sales may occur from 30- to 90-plus days after sales contracts are written.
Nationally, total existing-home sales transactions completed transactions that include single-family homes, townhomes, condominiums and co-ops, dipped 2.7% from February to a seasonally adjusted annual rate of 5.77 million in March. Year-over-year, sales fell 4.5% (6.04 million in March 2021).
The statewide median sales price for single-family existing homes was $396,558, up 21.3% from the previous year, according to data from Florida Realtors Research Department in partnership with local Realtor boards/associations. Last month’s statewide median price for condo-townhouse units was $308,000, up 27.3% over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.
Nationally, the median existing-home price for all housing types in March was $375,300, up 15.0% from March 2021 ($326,300), as prices rose in each region. This marks 121 consecutive months of year-over-year increases, the longest-running streak on record.
Palm Beach Real Estate Attracting Multiple Bids, Buyers Going Over-List Price
The median percent of original list price received for single-family homes was 100% in March 2022, up 2.5% from 97.6% last year. The median percent of original list price received for existing condominiums was 100%, up 4.7% from 95.5% last year.
The median number of days between listing and contract dates for Palm Beach single-family home sales was 10 days, a 44.4% decrease from 18 days last year. The median time to sale for single-family homes was 51 days, a 19% decrease from 63 days last year.
The median number of days between the listing date and contract date for condos was 10 days, down 72.2% from 36 days. The median number of days to sale for condos was 50 days, a 34.2% decrease from 76 days.
Palm Beach Cash Sales XX% More than National Figure in March 2022
Cash sales represented 57.3% of Palm Beach closed sales in March 2022, compared to 49.2% in March 2021. About 28% of U.S. home sales are made in cash, according to the latest NAR statistics.
The high percentage of cash buyers reflects Miami’s top position as the preeminent American real estate market for foreign buyers, who tend to purchase with all cash as well as some moving from more expensive U.S. markets who can buy more with their profits from real estate sales.
Cash sales accounted for 65.9% of all Palm Beach existing condo sales and 48.1% of single-family transactions.
To access March 2022 Palm Beach Statistical Reports, visit http://www.SFMarketIntel.com
Note: Statistics in this news release may vary depending on reporting dates. MIAMI reports exact statistics directly from its MLS system.
About the MIAMI Association of Realtors
The MIAMI Association of Realtors (MIAMI) was chartered by the National Association of Realtors in 1920 and is celebrating 102 years of service to Realtors, the buying and selling public, and the communities in South Florida. Comprised of six organizations: MIAMI RESIDENTIAL, MIAMI COMMERCIAL; BROWARD-MIAMI, a division of MIAMI Realtors; JTHS-MIAMI, a division of MIAMI Realtors in the Jupiter-Tequesta-Hobe Sound area; MIAMI YPN, our Young Professionals Network Council; and the award-winning MIAMI Global Council. MIAMI REALTORS represents over 60,000 total real estate professionals in all aspects of real estate sales, marketing, and brokerage. It is the largest local Realtor association in the U.S. and has official partnerships with 226 international organizations worldwide. MIAMI REALTORS has just launched its new YPN Global and will host the first-ever YPN Global Congress in March 2023 in Dubai. MIAMI has just been selected to host the prestigious FIABCI World Congress in June 2023. MIAMI’s official website is www.miamirealtors.com