The Real Deal Miami

Palm Beach County condo market stagnates

Year-over-year, non-foreclosure condo sales are down 3.4 percent
By Dan Weil | May 18, 2015 09:45AM

Aerial shot of West Palm Beach

While Palm Beach County’s residential condominium market has rebounded from the worst days of the 2007-09 recession, it has barely treaded water over the past year, data shows.

The 12 months ended April 30 saw 11,292 non-foreclosure condo sales, down 3.4 percent from 11,691 in the year-earlier period, according to CoreLogic data compiled by Metrostudy.

The average price for new condos plunged 28 percent to $556,818 in the latest period from $769,482 a year ago. To be sure, the average price for existing condos rose 6.5 percent to $233,710 from $219,531.

“We’re in the final phase of shaking out inventory from the last cycle,” said David Cobb, regional director of Metrostudy South Florida. “While new construction is pretty muted, the inventory of the last cycle is being absorbed. A lot of re-sales are available.”

New condo sales volume totaled only 231 in the latest year, down 17.5 percent from 280 in the prior 12-month period. Re-sales numbered 11,061, down 5.1 percent from 11,650 a year ago.

On the new construction front, Cobb said he knows of only one sizable project currently being built in the county. But plenty more may be on the way. Projects for about 4,000 new condos are underway or in the approval process, according to Jack McCabe, CEO of McCabe Research & Consulting in Deerfield Beach.

That pales in comparison to 8,000 in Broward County and 22,000 in Miami-Dade. What Miami-Dade has that Palm Beach doesn’t is buyers from Latin America. They feel more comfortable in Miami-Dade’s culture, which has a much stronger Latin flavor than that of Palm Beach, real estate pros say.

Another factor limiting the condo market in Palm Beach County is that there is still some land available for building single-family homes and townhouses, unlike in Broward and Miami-Dade counties, McCabe explains. The availability of such homes, of course, lessens demand for condos.

In Palm Beach County’s favor, prices for condos are still considerably lower than in the two counties to the South. Prices for waterfront condos range from $400 to $800 per square foot in Palm Beach, compared to $800 and up in Broward and Miami-Dade, McCabe says.

He’s particularly bullish on Boca Raton. “It has really taken off,” McCabe said. “The current city council is more developer-friendly,” allowing taller projects than in the past, for example.