Today's Key West Citizen ran a first page story that read "Home sales go down as prices go up". Watching home sale prices in Key West is like tending a garden: build or fix-up a house, tend it, watch it go up in value, sell it and reap a profit. Repeat next year.
The article reported first half year sales of 191 homes which is down from 231 in 2015. The problem with computer generated reports is that the reporting area includes Stock Island up to Big Coppitt. Most of my buyers are looking for homes in Key West. So I took the time to see what really happened during the first half of 2016.I weeded out all properties not located on the Island of Key West where there were a total of 111 single family home sales. The least expensive home sold for $315,000; the median home sold at $734,000; and the most expensive home sold for a whopping $5,500,000. The average price per sq ft was $579.94. And the sales price to list price was 94.88%.
There were 167 single family homes sale during the first half of 2015. That is 56 more than this year. The least expensive home sold for $222,500 (as compared to $315,000 in 2016); the medial home sold for $659,000 compared to $734,000 in 2016); and the most expensive home was 620 Eaton Street that sold for $4,495,000 (compared to 101 Admirals Lane which sold for $5,500,000). During the first half of 2015 the average priced home sold for $526.89 per sq ft and compared to $579.94 in 2016. And the sales to list price in 2015 was 95.51 as compared to 94.88% in 2016.
There are currently 59 single family homes under contract on the Island of Key West. The least expensive home is offered at $349,000; the median is priced at $765,000; and the most expensive home is $4,250,000. Twenty of the 59 houses are priced at $1,000,000 or higher and 8 of those are priced at $2,000,000 and higher. That's a lot of money for a little town out in the middle of the ocean. Here's the kicker - 40 of the 59 houses currently under contract went under contract in the last month. And several others went under contract in the waning days of April. This follows the traditional pattern of houses sitting on the market for a few months. Buyers watch and wait for prices to drop (which they typically do) and then buyers swoop down and buy as sellers capitulate.
Thirty single family homes sold in the first half of this year priced over $1,000,000 at an average price per sq ft of $745.77. The median home in this price range sold at $1,387,500. That's a lot of money for people who have been planning to move here or to retire here. Over the ten years I have been writing my blog I have discussed the three segments of our market which are the lower priced homes, the mid-range homes, and the higher priced homes. That's a given in any market, but here the price disparity between these segments seems incredibly daunting. I work with a lot of buyers who are trying to purchase a property now before the prices continue escalate because that is the premise most buyers operate under. I agree with that premise. I do not think we are in a bubble. I think our market is healthy. I think our market is priced very high but not as high as it was a few months ago. It has adjusted downward. I continue to think some sellers are exceedingly greedy. I think a lot of buyers are fooling themselves that we are going to have a housing crash. That is not going to happen. The people who buy second homes here are successful people. The lax credit requirements that helped cause the 2008 crash have been curtailed. While money is relatively cheap, credit requirements and down payments keep the market from over-boiling. And in Key West most of our million dollar plus sales are cash.
If you are looking to buy a home in Key West please consider contacting me, Gary Thomas, 305-766-2642. I am a buyers agent and a full time Realtor at Preferred Properties Key West. Let me help you find your place in Paradise.