Palm Beach County Real Estate Press Pages
Larry Pettit in the News
Is there good news in the view of a growing number of local Realtors that the housing market in the Northern Palm Beaches may finally have hit bottom?Maybe. Some local Realtors are expressing a bit of optimism about the coming season.But keep in mind that nationally, although August offered a slight improvement, July’s numbers were at the lowest point in a decade.“The next few months may give us an idea of the true strength of the housing market, as the temporary economic stimuli will have ended,” said David M. Blitzer, chairman of the Index Committee at Standard & Poor’s.“Housing starts, sales and inventory data reported for August do not show signs of a robust market, and foreclosures continue.”
These national numbers are discounted, however, by Realtors like Chappy Adams, president of Illustrated Properties, who observes, “real estate is local, right down to the community.”
Adams, along with other local realtors and consultants, feels that the local market may finally have hit bottom.
Properties in the $200,000 price range have stabilized and in many areas have gone up a little, Adams observes, pointing to BallenIsles, PGA National and waterfront homes as providing examples of that trend.
“These places just didn’t see the peaks and valleys and they never had a ton of properties on the market,” he said. “And supply and demand play into prices of waterfront homes.”
Rob Thomson, Waterfront Properties’ Admiral’s Cove and Riverfront specialist, said, beware of statistical information when it comes to luxury properties, because they aren’t broken out.
“I’ve just returned from the Who’s Who in Luxury Real Estate conference in Seattle and I am very encouraged,” he said. “Agents from around the world reported that, while prices haven’t moved up, there’s more activity and sales.”
A recent bright spot: Waterfront Properties’ agent Kathy Palmer sold a Ranch Colony $10-million property on 20 acres in September. “It is the most expensive off-water, inland sale in MartinCounty’s history,” Thomson said.
“We’ve also sold three homes on the river for $3.5 million in the past year and a half. Confidence is back.
“Last year, people weren’t walking in and saying we’re at the bottom. Now people think we are at the bottom.”
For prices to stabilize, the markets must be healthy, with less than ten percent of the homes in the neighborhood or community offered for sale, he explained.
“Abacoa has seriously stabilized – only 100 properties for sale out of 4,000 – that’s 2.5 percent.”
Admiral’s Cove, a community with 888 properties, has 89 homes for sale, down from 115. Loxahatchee River, a community with 777 homes, has 61 homes for sale. “Those neighborhoods are healthy and have stabilized,” he said.
Tom Turner, a Realtor with Waterfront Properties who focuses on Jupiter Island properties, feels a bit more optimistic this fall.
“Born out by conversations I’ve had, we have reached the bottom. Buyers seem to be coming out of the woodwork, but that doesn’t translate into a boom of sales.
“My perception is that it’s going to get better, but we will have a very gradual and slow ride back up.”
On Jupiter Island, this year’s sales and sale prices look very similar to last year’s numbers, he reports. “We had 15 total sales last year, and nine so far this year, so the pace is about the same.”
Prices are down slightly but inventory has grown, with 80 Jupiter Island homes on the market; up from 75 last year. In a “normal” year, the average is around 65.
Jack McCabe of McCabe Research and Consulting expects that a large wave of foreclosures through 2012 will keep prices flat or slightly declining. “We don’t see positive appreciation coming out any time in the next year or two,” he said.
“Analysts have been calling it the bottom for the last two or three years; they didn’t have a clue. We are getting close, but the bottom is going to last for a while. Job loss and flat employment growth are the biggest drivers.”
However, he does note that Jupiter, Jupiter Island and Tequesta fair better than other Palm BeachCounty locations. “They’ve always been a little more upscale and, although haven’t seen the tsunami of foreclosures, they’ve had their fair share,” he said.
Like Thomson, economist Brad Hunter of Metrostudy points to DiVosta, Abacoa as a community enjoying growth. “The mature, master-plan community appeals to families with children and it is located near areas where jobs are being created,” he said. “Homes are selling at a pretty good clip, even here at the bottom of the worse real estate recession since the 1930s.”
Also, builders have sold off their inventory, he said, so that has brought down the supply of the empty new homes.
But challenges still persist. “Three years ago, the problem was subprime loans going bad. Now, the prime loans that were taken out five years ago are becoming delinquent and we are getting a second wave of foreclosures with regular loans,” he said.
“I say there are four Fs on why people aren’t buying in spite of mortgage rates below 5 percent and home prices back to pre-boom levels.
Financing: “Getting a loan from a bank is difficult. Loans are out there but you have to jump through hoops. Even if you have a job, and are wiling to put down cash, it’s still a pain to get a mortgage.”
Falling home prices: “That’s the notion: ‘why buy today when, in six months, I can get the same house for less?’”
Finding a buyer for the other house. “If (prospective) buyers can’t get their own house sold, they can’t get their equity out to buy a new home.”
Andrew Russo, a Realtor with Illustrated Properties in Jupiter has noticed that inventory of more expensive homes and condos is growing in North Palm Beach County, Jupiter and Tequesta.
“Second homes are going on the market,” he said, “and people who could afford to buy, aren’t, because they are uncertain about the future and they are holding onto their cash.”
He notes that homes priced under $350,000 are selling, as well as area investment properties under $150,000 with a positive cash flow.
Larry Pettit, a Realtor with Corcoran, notes these two trends in BallenIsles.
“Homes that were in the $500,000 and $600,000 range during the boom now sell for $300,000 and $400,000,” Pettit said.
“Same holds true with homes that were $800,000 to $900,000 prior to 2003, and at $1.3-$1.4 million during the boom. They are back down around $950,000 and just over $1 million range, and are generating interest.”
Around 130 homes are for sale in the BallenIsles community consisting of about 1,700 homes.
Also, he notes, buyers who could afford to spend more, are thinking conservatively and buying smaller homes.
Mark Griffin, managing broker of Coastal Sotheby’s International Realty in Palm Beach Gardens, said the market hit bottom earlier this year.
“We’ve reached stabilization locally, although it’s still a buyers’ market,” Griffin said.”
In the last two months, two Bear’s Club estates homes have sold in the low $4 million-range and a condo in the Carlyle on Jupiter Island sold in the mid $3 million-range.
“Communities like Evergreen and Abacoa have always represented a good proposition for buyers, offering a great house, location and lifestyle for the money,” said Griffin.
“Bear’s Club sale prices have held steady in the past two years. These homes are so unique that buyers focus on a single property, so they don’t get priced against each other.”
Sun, sand, and the ghost of Meadow Soprano.There’s lots of sunlight in this garment-district loft, built in 1911. But if it’s sunshine year-round you want-and golf courses galore-you could instead opt for a four-bedroom mansion on BallenIsles (which means “all that is beautiful” in Gaelic, says listing broker Larry Pettit), a country-clubby community close to Palm Beach that’s home to Venus and Serena Williams. Sopranos fans, take note: Jamie-Lynn Sigler-a.k.a. Meadow-lived here in 2004 when she was married to her then-manager, A.?J. Discala. According to the real-estate Website SouthFlorida.Blockshopper.com, they bought it in 2003 for $1.2 million.57 ST. GEORGE PLACE, PALM BEACH GARDENSThe Facts: Four-bedroom, five-bath, 5,749- square-foot house.
Asking Price: $1.749 million.
Taxes: $23,000 per year.
Agent: Larry Pettit, The Corcoran Group.
28 WEST 38TH STREET, APARTMENT 2E
The Facts: A one-bedroom, one-bath prewar loft.
Asking Price: $1.795 million.
Maintenance: $1,991.74 per month.
Agent: Halstead Property.