As home prices in South Florida inch their way upward for the 17th straight month, the median home price naturally keeps pace. Last year’s median list price of a home in Boca Raton was $279,000. This year it is up to $349,000.
While this is still well below the market’s peak in 2005 of just over $421,000, it may be enough to allow many formerly underwater owners to rise to the surface. It may even prompt them to sell, because they may have moved into the realms of a profit stream.
Boca Raton single family home prices up 29% since last year.
As the cliché says, numbers don’t lie. Prices are going up. In Boca Raton, that price rise is moving in on 29%. The good news is that more homes seem to be coming on the market, though not in abundance. Many potential Boca Raton home sellers are still sitting on the sidelines, waiting to see just how high this market will take them before they release their homes for sale.
Across the country, prices are moving upwards, though not quite at the same rate of speed. According to the The Standard & Poor’s/Case Schiller Index, prices have surged nationwide at a rate of over 14% since last year.
Boca Raton condo prices are also up since last year.
Case-Shiller does not track data for Boca Raton condominium prices, but the Realtors Association of the Palm Beaches indicates that area median condo prices increased by 16% to $259,990 since last year.
The very tight inventory of homes in our area is feeding this Boca Raton seller’s market. Lack of competition, combined with cash rich investors from all over the country and from countries all over the world, has emboldened sellers. Owners of desirable homes have no qualms about clinging steadfastly to their asking price.
Cash buyers remain abundant.
Cash is routinely expected and has been used to purchase an unprecedented 33% of homes in the area. As a result, buyers who have managed to get through today’s brutal mortgage approval process often find themselves to be the proud owners of a pre-approval letter and little else.
Buyers are routinely expected to bring “AS IS” contracts to the table. Unless repairs involve something like an open hole in the roof, sellers expect buyers to absorb the cost.
Good times for sellers, tough times for buyers.
Last year at this time, there were 3800 homes for sale in the area. This year there are 2600. While we have fewer homes on the market, we still have an overabundant supply of buyers. This lack of supply is what creates the current seller’s market.
Sentiment among some real estate pundits suggests that the market may cool down as mortgage rates rise. Others, however, feel that there is sufficient momentum in the market and more than enough investors with cash to keep the housing recovery in full swing.
Stay tuned. But if you’re thinking about selling your home in Boca Raton, get ready to have several interested buyers on your doorstep within 48 hours. Or less.
Marc Jablon, The Jablon Team
RE/MAX Complete Solutions