The Real Deal Miami

Mansion prices move to lower price bracket

By Sally Apgar | September 28, 2009 03:05PM

Palm Beach’s shoreline is eroding in different areas, but not as fast as the top end of its luxury market. Last week, brokers said an elegant oceanfront estate on Palm Beach Island that languished on the market for more than 18 months when priced at $13.5 million is now drawing interest — after a price drop of almost 25 percent.

Corcoran Group agent Randy Ely said that his seller, Ivan Mullenix, founder of St. Louis-based Mullenix, a real estate and development firm, and other clients are getting more realistic about prices and no longer expect the mind-numbing profits people turned several years ago. He said that posh Palm Beach market values have dropped 25 percent since the historic high of 2005.

“This property is priced to move,” said Ely of Mullenix’s mansion in Manalapan. “At $9.9 million, it’s priced to where the market has really gone.”

Ely said a “new base” price level is being established in Palm Beach for luxury homes as sellers lower prices to levels sellers can accept. Handfuls of lower sales have established a new floor for low-end comparable sales.

“People buy when they feel it’s a good deal,” Ely said. “And people who really want to sell, know where they have to price it. Now, they’re willing to accept offers that are low compared to the historic highs.”

In tony Palm Beach, where few houses have mortgages, sellers’ thinking is changing. Instead of expecting a mind-blowing windfall, Ely said, sellers are thinking: “I’ve still got a lot of profit in this house. I’ve owned it a few years and am done with it. So I didn’t get top dollar, I’m moving on with my life.”

Mullenix bought the Mediterranean estate at 1880 South Ocean Boulevard for $6 million in 1998, according to Palm Beach County property records. The records also showed the house had a market value of $7.8 million in 2007 which slid to $6.9 million this year.

Ely said that 60 people looked at the house but no one even started negotiating until the price dropped to $9.9 million.
The estate spans the island so that it has 150 feet on the Intracoastal Waterway and another 150 feet along the ocean with deep-water dockage. The five-bedroom home has a 60-foot pool, guest house and theater.