Posted: Jan 02, 2019
Old Town Home Sales End of 2018 Annual Report
The end of my street any morning

Sales of single family homes in Old Town in 2018 ended a two-year slide. 2018 had 137 sales, exceeding 2017 (121 sales) by 13% and 2016 (129 sales) by 6%. The1st Qtr had the weakest sales since 2012; yet, each following Qtr ticked up in sales with unseasonably strong sales in the 3rd and 4th Qtrs. April had the most sales 21, Feb the fewest 6. On Prices, ten months had an average sales price over $1M.  The year end average sales price per square foot of $781 was highest ever, topping 2017 by 8% and 2016 by 12%. Biggest winners were 2bed/1bath and 4bedroom homes.

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The below charts show sales of the seven most popular bed/bath combinations in Old Town Key West from January 1, 2008 to December 31, 2018. When there is a difference between total home sales and the sum of sales in the below seven charts it is because of a sale of, for instance, a 2bed/3bath or 3bed/1bath house or a house with more than four bedrooms.

 

These charts are for single family homes sold south and west of White St. and cover the six neighborhoods of The Meadows, Old Town North and South, Bahama Village, Truman Annex and Casa Marina but not Sunset Key.  You can view a map of the six neighborhoods of Old Town here.  An analysis of 2018 end of year sales, neighborhood by neighborhood, is here.

 

The seven bed/bath combinations below contain enough sales to measure and evaluate trends after the 2004-2006 real estate Bubble.

1 Bedroom/1 Bathroom

  • Five, 1Bed/1Bath homes sold in the Old Town area thru 12/31/2018. The average number of days to sell is 45 days.
  • There are four 1/1 homes for sale from $499K to $995K.
  • The 2018 average sale price of $508,000 is 5% less than the average sale price for 2017.
  • In 2015, twelve homes sold, the most since 2001. In 2016, 9 sold. In 2017 there were 4 sales.
  • The average size of the 2018 homes sold is 615 sq.ft., slightly below average. The average sale price per sqft. of $826 is only 4% below 2017.

2 Bedroom/1 Bathroom

  • Twenty-five, 2Bed/1Bath homes sold in the Old Town area thru 12/31/2018.  The average number of days to sell is 73 days.
  • The average Sold price of $784,000 is up 41% from 2017 which at $557K was down 4% from 2016. The $784K is 136% above the 2011 low.
  • Eight 2/1 homes are for sale with prices from $525K to $925K.
  • Sixteen 2/1's sold in 2016, eleven in 2017.
  • Since 2009, 2Bed/1Bath homes have been the 3rd most popular selling home in Old Town with 182 sales.

2 Bedroom/2 Bathroom

  • Twenty-seven, 2Bed/2Bath homes sold in the Old Town area thru 12/31/2018. The number of  Days to sell is 113 Days, 6% more than 2017.
  • The average sold price of $837,000 is down 6% from 2017 and is 97% above the low in 2009.
  • Thirteen 2/2's are for sale, priced between $595,000 and $1.625M.
  • The average Sold price per sqft for 2018 is $747.  In 2017 the average was $704, in 2016 the average was $614.
  • Since 2009, 2Bed/2Bath homes have been the biggest sellers in Old Town Key West with 285 sales.

3 Bedroom/2 Bathroom

  • Twenty-five, 3Bed/2Bath homes sold in the Old Town area thru 12/31/2018. The number of Days to sell is 130 Days.
  • The average Sold price of $1,054,000 is up 4% from 2017 which was 2% below 2016 and is 129% above the 2009 low.
  • The average sold price per sqft. is $687, up 2% from 2017.
  • Twenty-one 3/2's sold in 2015, fifteen in 2016 and twenty-seven in 2017.
  • Since 2009, 3Bed/2Bath homes have been the 2nd biggest sellers in Old Town with 205 sales.

3 Bedroom/3 Bathroom

  • Seventeen, 3Bed/3Bath homes sold in the Old Town area thru 12/31/2018. The average number of Days to sell is 171 Days.
  • The average sold price of $1.545M is up 9% from 2017 which was 1% below 2016.
  • The average Sold price per sqft. of $845 is up 5% from 2017 and is the highest since 2005.
  • Nineteen homes sold in both 2015 and 2016 with twenty-two sales in 2017.
  • Since 2009, 3Bed/3Bath homes have been the fourth biggest seller in Old Town Key West

4 Bedroom/3 Bathroom

  • Nine, 4Bed/3Bath homes sold in the Old Town area thru 12/31/2018.  Average number of days to sell is 114 days.  In 2017, the average number of Days to sell was 51 days.
  • The average sold price thru December is $1.864M, up 25% over 2017. In 2017 the average sale price was $1.488M with the 5-year average sales price at $1.525M.
  • There are eleven homes for sale, ranging in price from $995K to $3.7M.
  • Number of sales and sales prices for 4Bed/3Bath homes is very choppy though there has been an erratic up trend in average sale price since 2013.

4 Bedroom/4 Bathroom

  • Fourteen, 4Bed/4Bath homes sold in the Old Town area thru 12/31/2018. The average number of Days to sell is 131 days. Fourteen sales is a record going back to Jan 2012.
  • There are seven 4/4's for sale ranging from $1.35M to $2.999M.
  • The 2018 average Sold price of $2.424M is up 14% from 2017 which was 1% below 2016.
  • The average sold price per sq.ft. of $912 is 20% above 2017. (In November a 2550 sqft home sold for $5M).
  • Since 2003, average number of annual sales is six, with six in 2015, eight in 2016 and six in 2017.  Since 2015, price action has been steady, $2M - $2.4M, despite a limited and choppy number of annual sales.

Summary

 

Following the 1st Qtr of sales, prospects for the year looked bleak.  But the 2nd Qtr powered forward and 2018 never looked back.  Sales held steady with no major hiccups.  Buyer confidence is underscored by the continued presence of cash sales - 52%. The national average is 22 - 24%. Cash sales occured from $420,000 to $5,000,000!  Unlike the low downpayment/flip purchases from 2002 - 2005, these cash sales provide a solid and committed ownership base.

 

Prices in 2018 continued their move up, albeit at a slower, less frothy pace.  Likewise, sellers and their agents were more flexible in their list price (LP) to sale price (SP) negotiations.  The average LP:SP ratio dropped slightly to 94%.

 

One thing to note for certain, there remains a reasonable level of pent-up buying. Most realtors have a ready list of buyers and what that buyer wants.  If a property is marked anywhere near "Priced to Sell" it goes. All property types except 3bed/3bath Closed within 131 days or less of Listing. 

Conclusion

I have good news and I have bad news. 

 

The S&P 500 Index is UP approximately 135% from the 2009 low.  Before the stock market tanked in 2007, margin debt (borrowing money to buy stocks that you would pay back after the stock increased in value) was highest since 2000.  Margin debt now is negligible. The value of the dollar is at its highest in 15 years. I have not seen any GDP estimates for 2019 at less than 2.4%. The Federal Reserve is down to two interest rate hikes in 2019 - if that. Interest rates remain well under historic norms with today's borrowers of big money having the best FICO scores ever. The new USMCA reaffirms and strengthens hemispheric trade and continuity. The TCJA trimming of mortgage deductions for pricey 2nd homes did little. Big commercial investment into Key West guest houses ($100M+). A new Mayor. Record breaking arrivals at the Key West airport.

 

Tha bad news?  A possible slowing world economy due to the screwed up policies and balance sheets in the EU and China. Stand tall. I'm not worried.

 

PS - New FEMA flood zone maps are due out by probably Dec 2019. Everyone loses at least 1 foot. Get your Elevation Certificate now.

 

If you have any comments or questions, please contact me here.

 

Good luck in 2019!