Friday, September 27, 2013 / by Kristin & Mark Stampini
HOT DEMAND FOR BOCA-DELRAY HOMES
BOCA RATON, Fla. -"Picture Courtesy of: Florida Memory- Florida Photographic Collection"
Keeping balance on the real estate wave that has washed across Boca Raton and Delray Beach over the past few years has taken some real sticking power. Many people lost their footing along the way, but now there are signs that it could be safe to grab your real estate surfboard and get back in the water.
Palm Beach County started off 2013 with just 6,764 single-family homes for sale. That is a 40-percent drop from the year before. The numbers for townhomes and condos are similar. Boca Raton based Realtor, Kristin Stampini of Re/Max Services said, “The market has shifted and it is now a seller’s market. We have just over 4-months of inventory available. Just over a year ago we had 13-plus months of inventory. Prices are on the rise, and there are fewer bank owned homes on the market “.
“Low inventory has a big impact on business. It drives prices up and creates a situation where one home can end up with multiple offers. Some buyers are actually willing to pay above appraised value due to lack of inventory”, said Stampini. “Sellers are loving all the multiple offers.”
Boca Raton and Delray Beach remain areas in demand. Right now buyers searching in the South County area may find limited options once they’ve plugged in their price range and list of preferences. Neighborhoods like Hidden Valley, Pheasant Walk and Tropic Palms appear to be in high demand. A search of statistics on the Multiple Listing Service (or MLS) shows that in the last 6 months, homes in those Boca and Delray communities sold, on average, for prices that were 95% of what the sellers were asking.
Nationwide median home prices have built up 6.3-percent. It’s expected to be a busy year for realtors. Sale levels are expected to be close to what they were back in 2007. Last year there was a 9.2-percent increase, accounting for 4.65 million dollars in closed transactions.
Rising demand can mean some people who were upside down a few years ago, are no longer strapped down by an oversized mortgage. The shift could have some homeowners asking themselves if it is time for a move. Stampini said, “Right now interest rates are still low and prices just started to rise in 2012, so you can still get a much better price than you did in 2005 and 2006.”
Right now mortgage rates are near historic lows. In 2012 they dipped to 3.7%. That’s a significant drop from 2006 when interest rates were about 6.5%.
Other economic factors are in play too. The unemployment rate still needs work, but at 7.9% it seems to be moving in the right direction. In 2009, unemployment jumped to 10-percent. For now inflation remains close to the 2-percent target rate.
The changing market means you should not assume your neighbor is in financial trouble because a colorful ‘For Sale’ sign popped up in the yard. The changing market could lift the stigma of distress linked with being a home seller over the past few years.
Yet, Florida remains one of the hottest markets in the nation for foreclosure activity. With one in every 224 homes in Palm Beach County in some stage of foreclosure, it’s still an undeniable sign of distress and stress in Boca Raton and Delray Beach neighborhoods.
According to Stampini, “There will still be as many distressed homes in 2013 and probably 2014, but banks would like to see more short sales rather than foreclosures. On many properties, banks can get anywhere between 20 and 25-percent more for a short sale rather than for a foreclosure.”