The National Economy and Real Estate Sales in Rosemary Beach
August 18, 2014 by Linda Miller
I was in South Florida recently meeting with an elite group of real estate professionals from all over the world. Bernard Baumohl, chief global economist at The Economic Outlook Group, spoke to us about the state of the economy. Mr. Baumohl is well known for being ahead of the curve in assessing the direction of the US and world economy.
There is good news. The economy is re-energizing and the GDP has accelerated every quarter since 2012. Baumohl predicts that 2014 and 2015 will be the best economy we have seen in a decade.
- The labor market is up and companies are hiring again. Company payrolls reached a record high in March with more jobs than in the past six years.
- The unemployment rate was only 6.7% in March, compared to its highest rate of 10% in 2010. There was a 7 year low in applications for unemployment last month. Several factors have brought that unemployment number down, like baby boomers retiring & unemployed people going back to school, not to mention the “shadow economy” (which I dare not try to explain).
- Household balance sheets look better than they have in years. Consumer debt is at its lowest, stock portfolios & home values have rebounded.
- Consumer confidence in April was the highest since 2008 & consumer optimism is at an eight-month high. Retail sales are at a strong, and car sales are the best they have been in seven years.
- Businesses have strong earnings, banks are lending & making record profits, delinquency rates are the lowest in 6 years, & we have record US exports – 22% higher than last year.
Did you know that seven of ten US workers are employed by small business? Like our company - we employ over 60 people at Rosemary Beach Holdings and give back to this community by contributing to the Merchant’s association which sponsors special concerts, theater performances, and the special events that make Rosemary Beach such a special place to live and visit.
So, how does this affect real estate?
1) DEMAND – the demand for real estate in our traditional neighborhood is great! Twice as many sales as last year with half the inventory in Rosemary Beach so far this year.
2) AFFORDABILITY – Prices continue to go up 10-18% per year in the national market and ours on Scenic Hwy 30A are going up more than that! Cash buyers and institutional investors are big in the market, so it makes it difficult for first-time home buyers.
3) FINANCING – mortgage rates are expected to remain below 6% thru 2015, and are unlikely to go above 4.5%.
Lenders still very cautious when qualifying buyers & the process can be tedious.
4) INVENTORY -- Tight inventory continues to be an issue we deal with in most markets.
5) CONSTRUCTION - lot sales are a great positive indicator & new construction starts are snapped up before they can be finished.
Housing is 18% of the GDP, so it is a critical part of the overall economy. We also learned that when asked “where would you most like to live?” 56% of the people responded want to live in Florida! Smart people, huh?
What's happening in Rosemary Beach?
In the past six months, on the PARK SIDE, 19 homes have sold prices range from $850,000 - $2,300,000 and the average size home is 2836 square feet. Average listing price was $1,455,000 with average sold price of $1,383,092 (95% of listing price). Average sold $/square feet = $499.
The $2,300,000 sale was brand new construction with pool, courtyard & carriage house with all the best of finishes and upgrades, of course!
You might like to know we only have 15 homes on the market available to buy right now on the Park Side. Since we have sold 19 in the past 6 months, which should create some sense of urgency for those who want to own a home here.
On the GULF SIDE of our community in the past 6 months, 12 homes have sold. Prices range from $1,145,000 - $4,350,000. Average listing price was $2,496,250 with average sold price of $2,279,417 (92% of listing price). Average sold $/square feet = $724.
The $4,350,000. sale was a home that was a year old and had pool, courtyard , and a Bobby McAlpin carriage house that had been built several years before. The new home was designed by BOHEME design and had fabulous finishes & upgrades including the “best of everything”! It had been on our LUXURY rental program and produced over $200,000. in rental income the year it was rented.
We currently have 31 homes available to buy on the GULF SIDE of Rosemary Beach, ranging from $1,325,000 to $8,900,000. for a gulf front home.
What about CONDOS?
Seven condos sold in the past six months, ranging from $405,000. to $1,500,000. Average listing price was $859,686. and average selling price was $794,757 (92% of listing price). Average $/square foot = $553.
The $1,500,000. sale was a penthouse at 72 Main Street that sold for over $1050./sq. ft.
There are currently five condos available to buy, ranging from $699,000.-$1,400,000.
So, now you know!
We love to talk about real estate so please come by our office and visit. We are open seven days a week and ready to help. You will be greeted with a SMILE…..promise!