Dear Neighbor,
Last month's market activity was tough to improve upon - for the period ending June 1, 2019, we saw our most robust three-month period in nearly a year! March, April and May each saw closed sales in excess of $30,000,000, for an amazing quarter with total closed sales volume of $98,632,500; nearly double the preceding three-month period and a 51% improvement year over year.
In the June column, I was delighted to announce that with ten pending sales, we were seeing forward momentum that would predictably continue the upward trend. The only area of possible concern from a market perspective was the higher than average inventory levels.
This month, a number of properties in Royal Palm have gone under contract leaving us with fewer homes on the market – 66 this month as opposed to 75 in the June Market Report – and more properties in pending sale status – 13 vs 10 last month. The inventory concern continues to dissipate as our turnover rate falls into balance and excess inventory is absorbed.
Our average “Days on Market” metric is creeping up in both the golf course and waterfront segments. This can be directly attributed to a mounting surplus of new construction inventory in these categories. As homes from the original build era become increasingly scarce, it will be exciting for all of us in the neighborhood to see the cost of Royal Palm land continue to increase.
Case in point: Of the nineteen active waterfront listings 37% (7) are new construction offerings; 53% (10) were built in 2015 or later; and 79% (15) were built in 2001 or later.
The ambitious prices being asked by builder/developers surely has a great deal to do with the abundant inventory and the escalating Days on Market metric. In fact, there are only two new construction waterfront homes that have been on the market for less than a year and three of these new builds have been listed for sale for three years or more, never having been sold or occupied.
New construction along the golf course tells a similar tale. Of the twenty-three active golf course listings, 42% (8) are new construction offerings; 53% (10) were built in 2014 or later; and 74% (14) were built in 2000 or later.
Two recent golf course new construction contracts show a sign of surrender on the part of the builder/developers. After first being offered for sale as a new construction opportunity (pre-construction) in February of 2016 with a high ask of $6,490,000, 1229 Thatch Palm is in pending status as of this writing with a last asking price of $5,950,000. Meanwhile, 1289 Thatch Palm Drive recently closed at $4,500,000 - a sharp discount from the $5,750,000 last asking price – after 699 days on the market. The current holdout is 1815 Sabal Pam Drive which was first offered for sale (pre-construction) in November 2014 with a high ask of $7,995,000 and a current asking price of $7,400,000.
With all of the new construction offerings at record high prices, buyers continue to quickly snatch up move-in-ready homes offered at fair prices they see as a fair deal. Case in point: this month a resale golf front home built in 2000 at 1655 Royal Palm Way was listed and sold in just four days on the market with an asking price of $3,650,000. Inventory of move-in-ready condition homes offered at prices in line with recent sales activity are in short supply.
Water front sales were down 50% rolling quarter to quarter with six sales April to June. Total value of sales was down 52% quarter over quarter and up 20% year over year with $41,553,000 in closed sales. Average selling price was $6,925,500 a slight dip of 3% quarter over quarter and flat year over year. The average sold price per square foot was near flat at $1,021.
Golf front sales were flat rolling quarter to quarter with four closed sales April to June; year over year, up 33%. Total value of sales was down 29% quarter over quarter and up 47% year over year with $10,655,000 in closed sales. Average selling price was $2,663,750. The average sold price per square foot was $623.
Interior home sales were down 27% rolling quarter to quarter with eleven sales April to June; year over year up 57%. Total value of sales declined 35% quarter over quarter and increased 129% year over year with $27,589,500 in closed sales. Average selling price was $2,508,136 a decline of 11% quarter over quarter and up 46% year over year. The average sold price per square foot was $547.