Some interesting Luxury real estate news this past week that once again adds further weight to those that maintain that Palm Beach real estate is stabilizing. The latest Standard & Poor’s Case-Shiller Index – the 20-city Index rose 1% in May 2011 from the prior month – thereby posting two straight monthly increases. A Housing Wire article on June 26th, 2011 suggested that the gains were largely seasonal in nature and that the data simply supports that real estate is simply bouncing along the bottom and that the index remains at 2003 levels.
Separately, Realtor® Mag – The Official magazine of the National Association of Realtors® also reported on July 26th that the New Home Market Shows Signs of Stabilizing contending that the latest release of Government data from the Commerce Department saw a decline in inventories and an increase in prices for new homes that were indicative of a trend, on sharply reduced units sold. With new housing permits showing a significant double digit increase in June, coupled with the reduction in new home inventories, indications would appear to suggest that builders are slowly stepping back into the marketplace.
Nevertheless, the huge amount of older homes on the market continues to act as an overhang competing with new home sales as well as shadow inventory yet to come to market and be listed for sale. Our take-away therefore is that until the backlog of re-sales and foreclosures abates further, prices will continue to tread water.