March home sales rise in Florida, Palm Beach County; prices off 2010 levels

Category Property Values

March was "hot as a pistol" for home sales in Florida, topping even last year's volume, which was buoyed by the federal tax credit.

In Palm Beach County, 1,105 single-family homes traded hands last month, a 31 percent increase over March 2010 and a 50 percent jump from February. The sales are reminiscent of peak-year numbers, within striking distance of the 1,335 sales in May 2005.

But the 12 percent annual increase in buying statewide was accompanied by plummeting median sales prices, according to a Florida Realtors report.

In Palm Beach County, the median price for an existing home dropped 24 percent to $186,500, a price not seen since 2002. It was the largest decline of the state's 19 metropolitan areas.

Bill Richardson, president of the Realtors Association of the Palm Beaches, used the pistol metaphor to describe March sales. He knows the median price doesn't look good but cautioned against using it to negatively gauge the health of the market.

With the number of distressed homes on the market, such as foreclosures and short sales, Richardson wasn't surprised by the lower price.

He said inventory also should be considered when evaluating sales, noting that the number of homes for sale in Palm Beach County was down from a 16-month supply last year to a 9.6-month supply in March.

"We are selling things left and right, but they are under that $200,000 mark," Richardson said. "The good news is the buyers are here."

Sales weren't as robust in the Treasure Coast, where the number of home purchases fell by 2 percent from March 2010. The median sales price increased by 1 percent to $108,300.

Nationally, sales of single-family homes, townhomes and condominiums increased 3.7 percent in March from the previous month but were down 6.3 percent from March 2010.

Analysts at the National Association of Realtors, which also released its sales report Wednesday, said they expect sales to increase sporadically throughout the year.

"Existing-home sales have risen in six of the past eight months, so we're clearly on a recovery path," said Lawrence Yun, chief economist for the national association. "We project moderate improvements into 2012, but not every month will show a gain."

Yun blamed tight lending standards for the inconsistency, noting that all-cash sales made up 35 percent of the national market last month, up from 27 percent in March 2010. Investors accounted for 22 percent of sales in March, the national report found.

Richardson said investors also represent a large part of Palm Beach County's market.

"Investors are savvy and when they start to bring all this cash into the marketplace, and there is a ton of money coming in, it's a sure sign that we have hit the bottom or are coming off the bottom," Richardson said.

One issue that makes the bottom a moving target is foreclosure.

Although recent months have seen a decrease in initial foreclosure filings in Palm Beach County, County Clerk Sharon Bock reported an increase in filings in March, when 908 new foreclosures were filed, up from 756 the previous month and the highest number since October.

"We expect the increase in filings to continue as banks become less hesitant to file," Bock said, referring to last fall's foreclosure scandal that put home repossessions on hold at many banks. "As banks become more comfortable with their foreclosure processes, they will release files they have been holding and volumes will start to escalate."

Source: www.palmbeachpost.com