Sales for June continue to remain strong at 30 (SF-13, Con-14, Dup-1 & Lot-2) a 40% increase over June of 2010 at 18(SF-12, Con-5, Dup-1 & Lot-0). June 30, 2011 Y-T-D sales were 194(SF-89, Con-85, Dup-8 & Lot-12) up 28% over the same period last year. Of the 194 sales 15% (30) were distressed compared to June 30, 2010 Y-T-D sales of 151 (SF-92, Con-42, Dup-11 & Lot-6) 25% (38) were distressed. Pended properties (properties under contract) continue to remain strong at 55 (SF-33, Con-21, Dup-1 & Lot-0). Inventory continues to move downward and is below the average for the island of 450-500 and currently at 442 (SF-219, Con-139, Dup-35 & Lot-49) and the distressed inventory remains at 5% (24) (SF-7, Con-12, Dup-5 & Lot-0). Island Real Estate put six properties under contract in June and closed eight properties, in four of the eight Island Real Estate had both sides of the transaction.
This month’s Frank & Al’s Great Buys has two short sales at the top of the list. The gulf view two unit condo at 100-A 52nd St is pre-approved at $795,000 and is a very good rental doing about $70K of gross rental income. The other at 605 Baronet Lane at $549,000 is a nicely remodeled open floor plan canal home ideal for Florida living. If you want open water views for under one million dollars then 525 Key Royale Drive at $769,000 is a great buy. The Lot is worth $700,000 and you also get a 3 bedroom/3 bath pool home thrown in. If it’s rental income you want than check out 2916 Avenue E, 159 Crescent Dr and 4001 5th Avenue. These three properties all have a ratio of 10 or lower of purchase price/gross rental income which only the best investment properties on the island can do. Good rental properties are getting scarcer every month.
In summary, the island market continues to perform at record levels of sales transactions. As I mentioned before about 250 is the average yearly sales on the island. If you look at the sales from the peak years to the present (2003 – 325, 2004 – 378, 2005 – 438, 2006 – 138, 2007 – 199, 2008 – 211, 2009 – 233, 2010 – 316) it gives you a perspective on the healthy sales we are now enjoying. Sales for the 2nd quarter of 2011 hit 110 which is the first time since Q3 of 2005 that we had over 100 sales in a quarter and only the 4th time in twenty years. Inventory on the island dropped again to a six year low (442) and below the historic average inventory levels of 450-500. If the inventory gets below 400 we will see a seller’s market again. The low inventory is reflected in how few properties that are available to buy in great locations. There are only 2 non-gulf front properties currently for sale west of gulf drive and only 10 properties within 1.5 blocks of the gulf under $1 Million. At the same time distressed properties have remained at 5% of the inventory which means the absolute number of distressed properties has fallen significantly as the inventory has fallen. Of the 49 lots currently for sale on the island only 6 of them are non-gulf front and west of gulf drive and they range from $375K to $699K. As you can see from the graphs average and median sales prices continue to trend up which is also a byproduct of the low inventory. I’ve added a new chart this month which shows average and median sales prices for all four types of properties from 2005 through 2010. You can see that if you compare the end of 2010 with where we are six months into the year that the numbers are positive. As I mentioned last month when the economy shows some growth, the interest rates are going to shoot up quickly and at that point the combination of higher prices and higher interest rate are going to add hundreds of dollars to the mortgage of a property. I expect that the inventory will continue to decline based on the rate at which properties are selling on the island. Looking at where we are in the number of sales year-to-date I estimate we will close the year very close to 400 properties sold in 2011. If that is the case than it will be only the second year that we saw 400 properties sold in a year in the history of the island market. The only other year was 2005 with 438 sold, the peak year for Real Estate on the island.
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