Key West January 2018 Real Estate Sales - Prices are Out of This World

A couple of days ago I was talking with a fellow agent at Preferred Properties Key West. She told me she was up at 5:00 AM and was looking at sales statistics. She said not much has sold and there aren't all that many houses under contract. We shared our concern about over-priced market. I stated I watch the MLS like a hawk and primarily see new listings and price reductions.  They seem to go hand in hand. Some agents will take any listing and put it out there simply to let the market tell the seller that your ego is too big for your britches. If you are a fan of the Million Dollar Listing Los Angeles you will have seen each of the agents try to educate sellers about not over-pricing. I've had the same discussions with potential sellers.

Shortly after Hurricane Irma I met with the owners of a house I had sold. They wanted to sell it. They remodeled a bedroom, updated a bath, and painted the house. They wanted to sell the place for about $400,000 more than they paid for it. I told them I did not want to waste my money on advertising and my life on holding open houses on a property that would not sell at that or anywhere near that price. They found somebody who would. When and if it sells, I will report back to you to see who was right and who was wrong.

Let's look at the numbers of what sold in January 2018 and contrast or compare to 2017  and 2016.

January 2018 SOLDS

There were 23 single family home sales on the island of Key West. The least expensive home was $350,000. The most expensive home was located on Sunset Key.  It sold for $5,900,000. The median home sale was $732,500.

January 2017 SOLDS

I am doing the research as I write. This is interesting. There were 23 single family home sales in this same time period compared to 2018. The least expensive home sold for $350,000 and the most expensive, located again on Sunset Key, sold for $5,000,000. Three of the 23 sales were on Sunset Key. They sold for $2,775,000, $4,650,000, and $5,000,000. That really screws up comparisons but that is a factor of our market in both Old Town and Casa Marina as well. The median home was $670,000.

January 2016 SOLDS

This is interesting!  There were just 17 single family home sales in January 2016 or seven less than in 2017 and 2018. The least expensive home sold for $370,000. The most expensive home for just $1,450,000. The median home sale was $630,000.

January 2015 SOLDS

As I started to write today's blog my intention was to go back to 2015. The results bothered me so I took the search back one more year.  There were 25 single family homes sales in January 2015. The least expensive house sold for $360,000. The most expensive home sold for $1.425.000. It was located at 1212 Georgia in the "Arts District" just east of White Street.  The median home sale in 2015 was $651.000.


As of today, February 4, 2018, there are 193 ACTIVE single family homes on the market in Key West. I took out the three most expensive because they really mess up the numbers when discussing prices. The least expensive home is offered at $389,000. The most expensive (not really) is located on Sunset Key and is offered at $6,950,000. The asking price on the median home is $1,294,500.  There are 27 single family homes priced between $2,000,000 to $3,000,000. There are nine priced between $3,000,000 and $4,000,000. There are 14 priced over $4,000,000. Where in the world are all of the buyers for these ego homes going to come from?

There are a total of 53 single family homes in the mls showing as contingent or pending. Fifteen of those are priced over $1,000,000. Three of the fifteen are priced over $2,000,000. I repeat the last sentence of the above paragraph, wherein the world are all of he buyers of these ego homes going to come from? I am glad a saved my money and my time and told my former customers to take a hike.


I share the frustration with my fellow agent about the current lack of sales. Our January sales for 2018 actually look a bit better than the prior years, but the inventory of available homes is way over-priced.

Key West First Six Months Sales Report 2016

I moved to Key West in 1993 because of the way all people are treated - as one Human Family. There are people here from all over the world and we all seem to get along just fine. Most of the people from third world countries are here on work permits. They work several jobs and many live in substandard housing. Many of these people work two or three jobs to save enough money to send back home to either help their families or to build a nest egg for their future.

A lot and I mean a lot of the workers in this town find it difficult to pay for a modest apartment let alone being able to buy a house here. I write about real estate properties for sale. In my Facebook page I say "I sell houses to rich people". That is really what I do because most people who read my blog know that only rich people can afford to pay the ridiculously high prices for homes here. I do work with locals, often hard working young folks who have saved as much money as they can stash away, hoping to find a place they can afford. I get no greater pleasure out of my life than being able to have that happen. And that is the truth. I know what it is like not to have money. I had to do without in school as a kid, college, and later law school.  I saved and did without so that one day I could do better. And I did.  I moved to Key West to get away from the world up north in America where for my entire life gay people were not accepted. I worked in a law firm where the senior partner found out I was gay and then demeaned me. In Later I found out about Key West in an magazine called After Dark. It was a town where gays were accepted. It had an openly gay mayor - the first in the nation. This was before Harvey Milk. What a great town this must be, I thought. And it is!

I wrote a blog in February discussing what I thought were too many over-priced homes, especially the number of homes priced over one million dollars. Most people in the United States will never earn a million dollars let alone buy a house that costs that much and even fewer will ever buy a second home that costs a million dollars or more. I decided to see how many houses sold in Key West during the first six months of 2016. I only looked at houses in Key West up to Shark Key even though our mls covers the islands up past Sugarloaf.  My readers want to buy a house in town and not ten minutes away even if it means they could save thousands and thousands of dollars.

There were 160 single family home sales in Key West during the first six months of 2016. The lowest priced home sold at just $168,000 while the highest sold at $5,500,000. The median homes sold at $942,543 at 94.99% of asking price. In previous years most homes sold at about 10% discount to asking price. The new ratio reflects the huge demand for homes in today's market.

There were 59 single family home sales in Old Town. The highest priced home was $5,550,000 (actually located in Truman Annex). The least expensive home sold at $315,000. The median home sold for $1,260,484. I am sure the big house and the cheap house skewed the numbers a bit.  These homes sold at 95.13% of asking price.

I then searched the number of sales of homes priced at $1,500,000 and higher in the Old Town area.
That $5.5 million house was still the most expensive. The least expensive sold at $1,820,00 with the median selling at $2,550,000 at an average price of $1,054.95 per square foot. These homes sold at 93.85% of asking price.

I was surprised to learn that the highest priced home in Casa Marina sold for only $2,000,000. The lowest priced home sold for $775,000. The median home sold at $1,483,222 or for $677 per sq ft. The demand for homes in the Casa Marina area is strong. There was a flurry of sales activity in May and June. There are several that are marked as contingent or pending in our mls. We shall see how well this area compares to Old Town at the end of 2016.

 In my February 8th blog I wrote:

"We have just begun the second month of our selling season. I wonder how many of the million dollar buyers we will see in Key West this year. I wonder how many sellers who have their homes listed for over one million dollars will sell and how many will not. And since we only sold 11 homes priced over $2 million 2015, I wonder how many such sales we will get this year. The stock market has not been our friend of late. I don't think we have been impacted by the ZIKA Mosquito Virus. But I am sure it will come into play sometime. Yes we do have a demand for quality homes in good areas. I just do not believe we have as many buyers as we have properties for sale."

Twelve houses priced over $2 million sold in the first six months of 2016. So we have already beat the 2015 record. The least expensive house sold at just two million in Truman Annex and the highest was the $5.5 million home in Truman Annex home. The median house sold at $3.006,250. The group of houses sold at 93.98% of asking. I was dumbfounded to learn that I sold the second highest priced home in Key West during this time period. And my office represented the buyer or seller or both in five of the twelve big sales.(And to top it off my broker, Laurie McChesney, represented the buyer who purchased the most expensive home in the Lower Florida Keys this year. That buyer paid $6 million for a waterfront home on Sugarloaf Key. )

Maybe my whining about prices was premature. We have a big election coming up. The stock market hasn't decided what will happen with Brexit, and I don't think it looks forward to a Trump presidency.
Uncertainty can rock the world. There may be a down market in our future. The thing is this is America where we always rebound. I started this blog ten years ago when the Key West market was headed downward. That created a lot of buying opportunities for people who had waited as the 2001 to 2006 market rose and many got sold out of a future. The downward spiral worked for many because our market really rebounded bigger and stronger than the rest of America as a whole.  There are buyers now. There just are not that many that can afford or who are presently willing to pay the high prices asked for most of our homes in Key West.

Key West Home Sales - First Half 2016

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.