Did you ever feel sorry for the really wealthy real estate owners? Well, we’re at a point in time when there might be just cause for feeling sorry for them because like all sellers, when your market is slow everyone deserves some sympathy.
Wealthy buyers are pulling back from some of the most expensive housing markets in the country. Toll Brothers Inc., the nation’s largest publicly traded luxury-home builder said that purchase agreements fell 3% from a year earlier, worse than the expected 1% predicted.
A large slice of this decline is concentrated in California where homes under contract had an average price of $1.74 million in the last quarter. Toll Brothers further indicated their orders in California tumbled 36% from a year earlier.
Some of this decline in the luxury market, in California at least, is the Chinese buyers that are pulling back from the market combined with the federal tax overall limiting deductions for property taxes and mortgage interest. However, what happens in California may stay in California since Palm Beach, Florida recently had a record sale of over $100 million.
In addition, low interest rates, wage growth and record low unemployment rates are moving first time buyers into the market, creating a demographic shift in the lower price ranges. The luxury market is adversely affected by an improving lower end market since all real estate markets are interconnected.
That said, let’s take a look at the three-month analysis of properties selling over $1 million on Anna Maria Island and in Cortez for May, June and July. Closed sales are compiled from the Manatee County Property Appraisers Office and available properties from realtor.com as of this writing.
Cortez did not close any $1 million or over properties during May, June and July. In the prior analysis, there were two sales.
The city of Anna Maria closed 13 properties at $1 million or over, ranging from $3,395,000 to $1,075,000. The last three-month analysis showed 14 properties closed in this price range.
Finally, the combined cities of Holmes Beach and Bradenton Beach closed 14 properties $1 million or over during May, June and July, ranging from $3,725,000 to $1,000,000. The last analysis showed 19 closings.
Currently on the market or pending in Cortez, there are six $1 million or over properties. For the last analysis, there were five.
The city of Anna Maria has 48 properties either available or in contract ranging from $5,500,000 to just above $1 million. Besides the highest listing, there are two over $4 million, five over $3 million, 12 over $2 million and the balance below $2 million. The last analysis had 60 properties listed.
Bradenton Beach and Holmes Beach currently have 69 properties either available or in contract ranging from $599,000 to $1,149,000. Three are over $5 million, three are over $4 million, two are over $3 million, 15 are over $2 million and the balance are under $2 million. The last analysis had 68 comparable properties.
If the luxury market is falling off generally around the country price-wise, Anna Maria Island is not listening, at least not yet.
These continue to be pretty impressive numbers for a small island and an even smaller fishing village. And as noted in this paper previously, Cortez is the second least affordable place to live in Florida, according to a study by UnitedSatesZipCodes.org. First place goes to Boca Grande. To be fair, the rankings are determined by calculating several factors and Cortez being a small area with many high-priced homes certainly contributes to this calculation.
See you again in three months. In the meantime, it’s okay to feel sorry for the very wealthy – the little darlings.
More Castles in the Sand:
The fun and not-so-fun of selling a home
