Six single family homes sold in the Old Town area of Key West in June, the fewest number of monthly sales in 2024, bringing the total number of sales for the 1st Half to Sixty-two. Sixty-two sales is 35% fewer than the 5-year (2019-2023) average of 1st Half sales and, while 62 sales is 3% ahead of 1st Half 2023 sales, 62 sales is 44% fewer than 1st Half 2022 and 62% fewer than 1st Half 2021.  On Prices, the average sold price of these 62 sales in the 1st Half 2024 is $2.18M, a record high for any 1st Half prices.  The average sold price per square foot is $1253, down 2% from end of 2023 yet up 61% since 2020.

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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, 2015 to June 30, 2024. 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 the number of sales and sale prices for each of these six neighborhoods for the 1st Half of 2024 is here.

1 Bedroom/1 Bathroom

• Five, 1Bed/1Bath homes have sold in the Old Town area thru 6/30/2024. The number of days on market was 71 days. For all 2023, seven homes sold at an average number of days to sell of 24 days.
• The average Sold price for the five 2024 sales is $717K which is down 12% from 2023 yet 268% above the 2011 low. In 2023, seven homes sold at an average sale price for of $817K.
• There are two 1/1's for sale priced at $949K and $999K
• The 2024 sales have an average of 514 sqft at an average of $1394 per sqft.  In 2023, the average size was 603 sq.ft. and the average sold price per sqft. was $1356.

2 Bedroom/1 Bathroom

• Six, 2Bed/1Bath homes have sold in the Old Town area thru 6/30/2024 at an average of 88 days to sell.  For all 2023, six homes sold at an average of 88 days to sell.
• The 2024 average sold price of $979K is down 22% from 2023 and 195% above the 2011 low.
• The 2024 average sold price per square foot of $1223 is down 2% from 2023 and is second highest ever.
• There are eight 2/1's for sale priced between $749K and $2.56M
• Since 2009, 2Bed/1Bath homes have been the 3rd most popular selling home in Old Town with 255 sales

2 Bedroom/2 Bathroom

• Fiteen, 2Bed/2Bath homes have sold in the Old Town area thru 6/30/2024 at an average of 72 days on market. For all 2023, fifteen homes sold at an average of 46 days to sell. Fifteen sales was the fewest since 2008.
• The 2024 average Sold price of $1.454M is down 11% from 2023 and 242% above the low in 2009.
• Sixteen 2/2's are for sale, priced between $1.49M and $2.45M.
• The 2024 average Sold price per sqft of $1262 is down 2% from 2023.
• Since 2009, 2Bed/2Bath homes have been the biggest sellers in Old Town Key West with 459 sold.

3 Bedroom/2 Bathroom

• Ten, 3Bed/2Bath homes have sold in the Old Town area thru 6/30/2024. The average number of Days to sell is 62 Days.
• The average Sold price of $2.05M is up 18% over 2023 and is 345% above the 2009 low. The 2024 average sold price per sqft. is $1225, up 7% over 2023.
• Sixteen 3/2 homes sold in 2023, fewest since 2016.
• Since 2009, 3Bed/2Bath homes have been the 2nd biggest sellers in Old Town, routinely exceeding 20 sales annually. Total sales since 2009 is 359 sales.

3 Bedroom/3 Bathroom

• Ten, 3Bed/3Bath homes have sold in the Old Town area thru 6/30/2024. The average number of days on market is 54 Days! For all 2023, 14 homes sold at an average of 110 Days.
• The 2024 average sold price is $2.325M, down 5% from 2023 and 215% above the 2010 low. The 2024 average Sold price per sqft. is $1318, down 8% from 2023.
• Fourteen homes sold in 2023, fewest since 2011.
• Since 2009, 3Bed/3Bath homes have been the fourth biggest seller in Old Town Key West with 301 sales

4 Bedroom/3 Bathroom

• Three, 4bed/3bath homes have sold in the Old Town area thru 6/30/2024 at an average of 31 days on the market. For 2023, 5 homes sold at an average of 40 days to sell. In 2022, 13 homes sold at an average of 66 days to sell.
• The 2024 average sold price of $2.658M is down 15% from 2023 and is 271% above the 2009 low.
• The 2024 sold price per sq.ft. of $1506 is down 32% from 2023.  2023 ended with the highest ever average sale price per sqft of $2210. The 5-year average sold price per sqft is $1259.
• There are eleven 4/3 homes for sale priced between $1.5M and $5.5M

4 Bedroom/4 Bathroom

• One, 4Bed/4Bath home has sold in the Old Town area thru 6/30/2024. For all 2023, nine homes sold at an average of 39 days to sell.  In 2022, nine homes sold at an average 49 days.
• The 2024 sold price of $5M is up 66% over 2023 and is up 349% over the 2009 low. The 2024 sold price per sq.ft. of $1538 is up 38% over 2023. The 5-year average sold price is $2.73M.
• Since 2003, the average number of annual sales is six, with nine in 2022, eighteen in 2021 and two in 2020.
• Despite the choppy number of sales, price action has steadily climbed from $2.M in 2015 to $3M in 2023.

Summary

The 5-year average of annual sales in the Old Town area is 151.  March-June is the peak period of sales with an average of 70 sales.  March-June 2024 had 39 sales. The 2nd Qtr 2024 had 27 sales, fewest since Covid 2nd Qtr 2020. 1st Half 2024 record high average sold prices were helped along by a single $9M sale and average monthly sold prices per square feet for the 1st Half ranged between $1250 and $1310.

Monthly inventory has bounced between 87 - 105 and cash sales continue to dominate across all price categories at 68% - 74% of monthly sales.  There is no measurable pattern or "sweet spot" of list or sale price though obviously the overall price point has moved up.  Through June 30 there were 13 sales under $1M and thirteen sales over $3M.  List price to sale price ratio maintains its historical level at 95%.

Conclusion

In the Old Town area for all 2023 there were ninety-one sales, the fewest since 2009.  2009/2010 was our last bottom. In the 1st Half of 2023 there were sixty sales.  In the 1st Half of 2024 there were sixty-two sales. Prices however are up 195% - 349% over those 2009/2010 lows. 

Cash sales in the Old Town area are dominating not so much because of the increase in the number of sales from cash buyers but because mortgage buyers have pulled back.  Not until interest rates fall by 2% will mortgage buyers return to the market. Meanwhile buyers of every category continue to evaluate the merits of living in Key West as opposed to other second home locations. Insurance risk, non-Homestead property taxes and basic quality of life issues are all key factors.  It is even more difficult for those who want to come to Key West to live; selling a home with a low interest mortgage and buying a smaller, more costly home with a high interest mortgage is a tough chew.  City Hall's deference to tourist issues over residential issues does not weigh in on the positive side of the equation.

Yet, there is GOOD NEWS.  The Department of the Navy is pushing its Housing Requirements and Market Analysis (HRMA) to 2025 from 2026.  The HRMA is performed every 5 years and evaluates the quality and quantity of housing for military members in the greater Key West area. The analysis will provide the Navy and the Secretary of Defense with the ammunition to undertake one of two courses of action; raise the housing allowance given to military members to help cover housing costs or build new housing on the military bases in Key West. The HRMA in 2021 raised the housing allowance, resulting in the highest allowance given to military members in the US.  This is not a viable solution. A higher allowance goes directly to landlord pockets and creates ZERO solutions  New housing constructed on Navy bases is the only viable solution to the supply:demand dilemma that is choking overall workforce housing. The Navy views housing as a foundational Morale and Welfare issue that impacts individual performance and command readiness.  Shouldn't the civilian community do likewise?

The Greater Key West Chamber of Commerce, Association of Realtors, City Hall and the Navy must all band together to steer the 2025 HRMA to building new housing on Navy bases in Key West. Only the Navy has enough acreage to accomodate the number of new housing units needed to take the pressure off of sky-high rents. It is a lengthy process but a steady and unwavering commitment to new construction is the only viable long-term solution.   

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

Best of luck.

This will be my last report for 2024.  In a few weeks I am moving to Bologna, Italy to attend Johns Hopkins SAIS Europe for the purpose of obtaining a Master of Arts in Global Risk.  This 12 month study of regional and global economics and politics will consume all of my energies - and then some.  Salute.

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