The whole of the Palm Beach market felt the effects of an unbridled second quarter during 3Q, with severely limited inventory and rising home prices.

“The Palm Beach sales boom officially extended to the condo and townhouse market this past quarter. As the number of available single-family homes continues to dwindle, townhouse sales were up 64% YOY and in Palm Beach alone, condo and co-op sales rose by 58% annually, the fifth consecutive quarter with an annual increase in closings. The increase in activity across all housing types further proves that buyers are eager for their piece of the South Florida market.  

This limited inventory is also driving significant price growth; the average price for single-family homes jumped 137% year-over-year and the high-end of the market saw 17 sales over $10M, six of which were over $30M. At first glance, these stats might suggest that this market is starting to cool down but the shifts seen in the third quarter point to a rebound in the condo/co-op market. Overall, the desire for more space, still-low interest rates, and incredibly favorable tax advantages will continue to drive buyers to South Florida through the end of 2021.”

— John Hackett, The Corcoran Group’s Senior Managing Director for South Florida

PALM BEACH HIGHLIGHTS

Even with limited inventory, Palm Beach remains an incredibly hot real estate market and this quarter saw the combined number of single-family and condo/co-op sales increase YOY – alongside sales volume and average price.

• • Limited inventory drove significant price growth – the average price for single-family homes jumped 137% year-over-year.
  • The high-end single-family home market was also particularly active this quarter, with 17 sales over $10M, six of which were over $30M.

At first glance, these stats might suggest a cool down but the shifts seen in the third quarter point to an incredibly limited supply of single-family homes and a rebound in the condo/co-op market.

• • Condo/Co-op sales rose by 58% annually, the fifth consecutive quarter with an annual increase in closings.
  • Overall, the desire for more space, the ongoing work from home trend, low interest rates, tight supply and favorable taxes continue to drive buyers to the area, which we expect to continue through the end of 2021.

OUTSIDE PALM BEACH

With incredibly limited inventory in Palm Beach, eager buyers who want a piece of this South Florida lifestyle continue to look to outlying neighborhoods and condos/co-ops for a slice of this market to call for their own.

In the area from West Palm Beach to Lake Worth, single-family homes sales were essentially level with last year while condo/co-op deal activity spiked by 97% YOY.

• • At 175, condo/co-op sales nearly doubled versus a very low Third Quarter 2020.
  • Single-family home sales remained consistent with last year, noting only one additional sale.

In the area from Hypoluxo Island to Highland Beach saw an annual decline in single-family home closings year-over-year, however, condo/co-op activity remained essentially level with last year, up by two sales.

• • Average and median sale price increased by double-digits year-over-year for both product types.
  • Condo/co-op average price increased 15% annually due to the decline in the number of transactions under $500K.

In the area from Jupiter Island to Singer Island, single-family home sales fell 35% YOY to 72 closings but condo/co-op sales were level with last year.

• • Condo/co-op average price and median price both increased by double-digits YOY, 30% and 36% respectively.
  • Driving the annual gains in pricing was a greater number of closings over $1M versus last year along with two high-priced sales over $5M closing in 3Q 2021.

Delray Beach saw an annual decline in single-family home sales YOY, however, condo/co-op activity spiked, increasing 71% YOY.

• • Single-family average price improved 49% year-over-year as the market share of sales over $2M expanded.
  • Condo/co-op average price increased 58% annually due to the uptick in the number of transactions over $500K compared to a year ago.

Townhouse sales were up 64% YOY, due to the number of available single-family homes tightening throughout most submarkets.

• • Annually, the average sale price rose 71%, and the median price grew 56% YOY. Price figures were pushed higher thanks to five-and-a-half times the number of townhouses transacting over $1M.
  • Days on market fell by 49% year-over-year as 80% of sales this quarter were on the market for under 60 days.

Read the Coastal Palm Beaches & Barrier Islands 2Q report.