MIAMI — Palm Beach County single-family luxury home sales rose year-over-year, according to May 2023 statistics released by the MIAMI Association of Realtors (MIAMI) and the Multiple Listing Service (MLS) system.
Palm Beach County single-family luxury $1M-and-up home sales rose 3.3% year-over-year to 348 transactions. South Florida showing appointments, meanwhile, increased 1%, from 245,225 in May 2022 to 248,540 in May 2023, providing another example of the strong foot traffic and demand for local properties.
“A surge of homebuyers from high-taxed, high-density states such as New York and California have purchased primary homes in Palm Beach County over the past three years,” JTHS-MIAMI President Martha Gillespie-Beeman said. “It is more than just taxes; it is about South Florida’s quality of life.”
Mortgage Rates Rise 1% vs. Last Year; Impacting Total Home Sales
Palm Beach County total home sales decreased 6.1% year-over-year in May 2023, from a historic 2,956 transactions in May 2022 to 2,775 in May 2023, because of elevated mortgage rates and lack of supply in certain price points.
Most of the homes purchased in May 2023 came to terms in April when mortgage rates averaged around 6.28%. Rates, in comparison, were at 5.27% on May 5, 2022.
Home sales are sensitive to mortgage rate changes. According to Freddie Mac, the 30-year fixed-rate mortgage 6.69% as of June 15. That’s down from 6.71% the previous week but up from 5.78% one year ago.
“With the Fed holding off on its rate increases briefly, I expect a busier summer market as interest rate-sensitive buyers take advantage of low mortgage rates– likely climbing down to the low 6% through September,” MIAMI REALTORS® Chief Economist Gay Cororaton said.
Palm Beach single-family home sales decreased 4.4% year-over-year, from 1,527 in May 2022 to 1,460 in May 2023 because of its comparison to a historic month and the current market has lower inventory in specific price points and higher rates.
Palm Beach existing condo sales decreased 8% year-over-year, from a historic 1,429 in May 2022 to 1,315 in May 2023, due to lack of inventory and rising mortgage rates.
Palm Beach County Home Prices, Household Income Rise with Wealth Migration
Palm Beach County single-family home median prices increased 1.2% year-over-year in May 2023, increasing from $615,000 to $622,500. Existing condo median prices increased 2.4%, from $307,500 to $315,000.
In-migration boosted South Florida household income by $16 Billion in 2021, according to MIAMI REALTORS® analysis of the 2020-2021 migration data released by the Internal Revenue Service.
New households moving into Miami-Dade in 2021 had an average adjusted gross income of $229,300. New households moving into Broward County had an average adjusted gross income of $102,600. New households moving into Palm Beach County had an average adjusted gross income of $242,200.
About 45,430 people moved into Miami-Dade in 2021, up 15% from the level in 2020 (39,562) and up 20% from the level in 2019 (37,630). Top households that moved into Miami-Dade included Kings County, New York; Cook County, Illinois; Queens County, New York; and Harris County, Texas.
Home prices are determined by supply and demand. Lower supply and higher demand create higher prices. Inventory for Palm Beach single-family homes (3 months) and condos (3.7 months) are low. Also, one of the supports for home prices is rents and rents are up.
Palm Beach County Inventory, New Listings Near All-Time Lows
While inventory is rising, Palm Beach County inventory is still near all-time lows. The monthly historical average for Palm Beach inventory is 16,196 and current inventory is at 7,198. Total inventory is down 46.8% from pre-pandemic (May 2019), from 13,386 to 7,126.
Total active listings at the end of May increased 56.9% year-over-year, from 4,586 to 7,198.
Inventory of single-family homes increased 34.1% year-over-year in May 2023 from 2,631 active listings last year to 3,529 last month. Condominium inventory increased 87.7% year-over-year to 3,669 from 1,955 listings during the same period in 2022.
New listings of Palm Beach single-family homes decreased 28.4% to 1,591 from 2,222 year-over-year. New listings of condominiums decreased 18.1%, from 1,754 to 1,437 year-over-year.
Months’ supply of inventory for single-family homes increased 76.5% to 3 months year-over-year, which indicates a seller’s market. Inventory for existing condominiums increased 184.6% to 3.7 months, which also indicates a seller’s market. A balanced market between buyers and sellers offers between six- and nine-months supply.
Nationally, total housing inventory at the end of May was 1.08 million units, up 3.8% from April but down 6.1% from one year ago (1.15 million). Unsold inventory sits at a 3.0-month supply at the current sales pace, up from 2.9 months in April and 2.6 months in May 2022.
Palm Beach Real Estate Posts $338 Million Local Economic Impact in May 2023
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 $122,000, according to NAR. Palm Beach sold 2,775 homes in May 2023 and had a local economic impact of $338 million.
Palm Beach total dollar volume totaled $2.4 billion in May 2023. Single-family home dollar volume increased 11.29% year-over-year to $1.7 billion. Condo dollar volume decreased 7.2% year-over-year to $692 million.
Palm Beach Distressed Sales Remain Low, Reflecting Healthy Market
Only 0.7% of all closed residential sales in Palm Beach were distressed last month, including REO (bank-owned properties) and short sales, lower than 0.6% in May 2022.
Short sales and REOs accounted for 0.03% and 0.6% year-over-year, respectively, of total Palm Beach sales in May 2023.
Palm Beach’s percentage of distressed sales are on par with the national figure. Nationally, distressed sales represented 2% of sales in May, virtually unchanged from last month and the prior year.
Palm Beach Median Price Appreciation Outperforming Nation, State
In Florida, closed sales of single-family homes statewide totaled 26,396 in May 2023, down 8.5% year-over-year, while existing condo-townhouse sales totaled 11,392, down 14.1%. Closed sales may occur from 30- to 90-plus days after sales contracts are written.
Nationally, total existing-home sales transactions rose 0.2% from April to a seasonally adjusted annual rate of 4.30 million in May. Year-over-year, sales dropped 20.4% (down from 5.40 million in May 2022).
The statewide median sales price for single-family existing homes was $419,900, down from 420,000 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 $325,000, up 0.9% 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 housing types in May was $396,100, a decline of 3.1% from May 2022 ($408,600). Prices grew in the Northeast and Midwest but fell in the South and West.
Palm Beach Real Estate Attracting Near List Price
The median percent of original list price received for single-family homes was 95% in May 2023, down from 100% last year. The median percent of original list price received for existing condominiums was 94.4%, down from 100% last year.
The median number of days between listing and contract dates for Palm Beach single-family home sales was 27 days, up from 11 days last year. The median time to sale for single-family homes was 75 days, up from 51 days last year.
The median number of days between the listing date and contract date for condos was 32 days, up from 10 days. The median number of days to sale for condos was 73 days, down from 50 days.
Palm Beach Cash Sales More than Double the National Figure
Cash sales represented 52.2% of Palm Beach closed sales in May 2023, compared to 57.4% in May 2022. About 25% of U.S. home sales are made in cash, according to the latest NAR statistics.
Cash buyers are not deterred by rising rates. The high percentage of cash buyers reflects South Florida’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.
In May 2023, cash sales accounted for 60.9% of all Palm Beach existing condo sales and 44.3% of single-family transactions.
To access May 2023 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 103 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 nearly 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 256 international organizations worldwide. MIAMI’s official website is www.MiamiRealtors.com