Home Sales in Hobe Sound Dismal in September
A big welcome back to our northern visitors who seem to return earlier and earlier each year. Already you can see the increase in activity; on the roads, at the beach, in the restaurants....everywhere. They return to a real estate market that just keeps getting more and more interesting and confusing. Across the Palm Beach County area we continue to see inventory levels at very low levels in many market segments but our last report showed levels starting to creep up, just slightly.
But the market is changing and the strength we had seen for most of 2012 is starting to sputter. Absorption rates are moving north as sales slow throughout the region. For the first time that I can remember we have seen a monthly decrease in sales in each municipality that we follow and the decline we are reporting here in September is rather significant.
Sellers have raised their prices, especially in the single family home market, and this coupled with declining inventories not only means that buyers have fewer choices but many of the choices they do have are more expensive than the most recent sales in their respective communities. No doubt sales are down and it certainly appears at this point to be a combination of weakening demand and homes that are priced higher than what the market will bear.
With interest rates still hovering at all time lows the cost of money is not an issue but qualifying for loans has never been more difficult. We are also seeing more and more transactions fall through due to appraisal issues. Even banks are listing their foreclosed properties at prices higher that the most recent comparable sales and no doubt frustration has set in with many buyers. Without question the next few months are going to be very critical in seeing just how strong this recovery is or if the overall economy is finally going to derail this train that has been chugging right along.
So let’s take a look at home sales in Hobe Sound and the surrounding communities for the month of September and see what has happened since our last report.
Palm Beach Gardens -
Tequesta -
Jupiter -
North Palm Beach -
Hobe Sound - down 76%
For the first time since February we are seeing the volume of home sales in Hobe Sound and the surrounding communities all fall during the month and the percentage declines are not what one hopes for in a market that is still obviously in the recovery mode. In September the median number of sales have decline 20% in our reporting area with the average decline and even more shocking 31%. We start this months report with home sales in Hobe Sound where sales volume dropped an amazing 76% from August levels. During the month of September a total of 7 Hobe Sound single family homes sold compared with 29 during the previous month. Going back over three years and still unable to find a lower monthly total of home sales in Hobe Sound which is a very bearish sign indeed. With this dismal showing we drop far below the 12 month average sales volume which currently stands at 18.92. Comparing September to year ago numbers sales also show huge declines when home sales in Hobe Sound stood at 13 for the month in 2011.
As we saw sales volume plummet in Hobe Sound we also saw the heaviest sales activity in sales between $0 and $150,000 with 5 sales and 71% of the entire market. Even more disconcerting is the lack of a single sale over the $300,000 threshold which is another very bearish sign when it comes to a continuation of the rebound we had been experiencing. The dearth of sales coupled with little activity outside the lower end pushed median sale prices to the lowest level we have seen in years. With a new multi-year low the median sales price came in at $149,000 in September which is far below the 12 month average which sits at $232,015. It also falls well behind the median sales price in September of last year which stood at $217,500. Below are the charts showing the percentage of single family home sales in each category for the month of September as well as median prices over the past 12 months in Hobe Sound.
There is no doubt significant reason for concern about the strength of this recovery moving forward and we hope our northern visitors will enjoy themselves so much during the winter months that a significant impact will be felt in home sales throughout the area. No doubt we do not need too many more months like September.
Until next month............
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