Tuesday, January 31, 2017

2016 Port St. Joe Market Report


I hope everyone's 2017 is off to a good start.  I appreciate all of the positive feedback from my Mexico Beach market report that I sent out earlier this month.  Things have gotten busier since then and thus delayed this follow up.  Buyers are through with the holidays and seem past the New Year and election jitters.  They have been looking for the right property in solid numbers again.  I've put 4 of the homes that I have listed under contact since January 16th with these two listed for a total of 3 and 7 days before going under contract.  It's also been positive to see two listings that I've had for 236 and 164 days receive offers that the sellers have accepted in the last two weeks. (I expect these types of things later in the Spring or Summer, but this kind of activity in January is very positive.) From Mexico Beach to Indian Pass, there are now a total of 78 properties under contract with 36 properties already sold this year.

I've also been meeting with a number of potential sellers that realize the market is up and are trying to decide if now is when they should sell or not.  It's a tough call with prices far lower than peak prices, but up considerably from the lows as well.  Unfortunately, none of them or myself have a crystal ball, and there are many factors that affect this decision.  The majority have decided they are confident in the market, and that they feel it will continue to move up, thus they will not try to sell this year.

The rest of this update is dedicated to the Port St. Joe area.  This area is doing by far the best it's been doing since the real estate boom and subsequent crash.  The whole area is much more upbeat with the most vibrant outlook it has had in years.  There are new businesses opening and not nearly the number of vacant commercial properties as there were a few years ago.  Other businesses are expanding, and there are more and more full time residents as well as visitors.  The schools are doing well with class sizes increasing, the sports teams are winning, and the academics were once again rated highly.  Port St. Joe real estate has seen a boost from the overall economy as well as more buyers are starting purchase in "town" for a 2nd home.  They've found there is a lot to do in Port St. Joe, and prices for comparable homes are more attractive than the beach markets of St. Joe Beach/Mexico Beach to the west and Cape San Blas/Indian Pass to the east.  
The Port St. Joe market on MLS includes four individual markets: Highland View, the city of Port St. Joe, Oak Grove, and Jones Homestead.  The city of Port St. Joe segment of this market has seen the biggest increases in demand and value.  Jones Homestead and Oak Grove also saw improvement in housing values.  A zoning change made in 2015 has given Oak Grove and Highland View owners a nice boost in lot sales.  These are now the only properties close to the water that allow new owners to use them for RVs since the county changed zoning laws and excluded St. Joe Beach and Beacon Hill in 2015.  A total of 34 lots sold in 2016 down from 39 in 2015 and nowhere near the 187 lots sales in 2004.  However, average selling prices saw a big jump in 2016.  2015 didn't have a single lot sale over $50,000, and there were 14 sales over $50K in 2016.  That's not to say that a $30K lot went up past $50K, but more premium lots like those closer to the water sold in 2016 while all prices moved up to some degree. I did exclude the $700K sale made by 98 Real Estate for the old Highland View school property in coming up with the average sale prices.  There is still a decent selection of vacant lots with a total of 64 listed and 25 priced at $40K or less, including 10 located in the city.


2015 saw the most homes ever sell in the Port St. Joe market with 116 sales.  2016 was 2nd best with 102 sales.  I believe the main reason that the number of sales went down wasn't demand, but lack of homes on the market.  Below are the average selling prices of homes.  I couldn't believe there wasn't a larger increase since 2015.  I know the average home is selling for at least 10% more than a comparable one sold for in 2015.  When I looked into the homes that sold in more detail, many were in low value areas or homes that needed significant work.  These sales held the average selling prices down.  I can even see a trend of increasing prices from the first 6 months of 2016 to the 2nd half.


2017 is shaping up to be a heck of a seller's market for homeowners.   People are wanting to buy homes in this area with an average of 96 homes a year selling over the last 3 years.  There are still as many, if not more, people looking to buy right now as there have been in recent years.  The problem for these people still looking to buy is that there is almost nothing left on the market.  We are officially at a 12 year low in housing inventory with just these 29 listings left These kind of supply and demand numbers point to more substantial rises in values than we have seen in some time.  I believe they'll almost certainly also lead to an increase in new construction, especially based on the large number of relatively low priced vacant lots still available.


All of these statistics point to an exciting 2017 for Port St. Joe real estate with a very probable chance of solid rises in housing prices.  I haven't even mentioned the elephant in the room which is 
The Port and more specifically Eastern Shipbuilding.  The Port Authority is continuing to make progress toward bringing jobs to the area and furthering the functionality of The Port.  A contract awarded to Eastern Shipbuilding of Panama City for $10.5 billion is going to add jobs to the Panama City area for sure, while possibly adding jobs directly to Port St. Joe.  Eastern has 20 acres leased from The Port where they are considering locating part of their operation.  Any significant job growth will be huge for a town of this size.  


Zach Childs 
Broker/Owner- 98 Real Estate Group
#1 Producing Real Estate Company Located in Mexico Beach-
2013, 2014, 2015, & 2016

Thursday, January 12, 2017

2016 Mexico Beach Market Report

Happy New Year,
I sincerely hope everyone is doing well and looking forward to 2017.  We have had a very busy 2016 in our real estate market and I have a lot of real estate information to share with you.  I can confidently say that all three of our market areas, Mexico Beach, Port St Joe, and Cape San Blas are continuing to trend upwards.  Each of these areas have similar market trends and tendencies but there are differences that require further analysis.  In this email I would like to concentrate on the Mexico Beach market, I will follow up with recaps for Cape San Blas and Port St Joe.
The Mexico Beach market, which includes St. Joe Beach, Beacon Hill, and WindMark Beach had a big year with sales over $65 million reported on MLS.    That's more than $16 million in sales volume above any year since 2005! There's no doubt that the Mexico Beach area along with Cape San Blas are getting more and more popular as family friendly vacation destinations.  Interest in purchasing has gone hand in hand with people wanting to vacation here with both rental and sales numbers going up once again.  I'm entering my 13th year and can say this market is doing the best that I've seen it in my career.   
Out of the 3 markets I cover, the Mexico Beach area had by far the most sales with 298 closed transactions.  298 sales are the 2nd highest ever reported, behind only 2004 when 345 properties sold.  181 homes sold in 2015 and 181 in 2016, which makes these the two years with the most home sales in the history of this market.  That's correct, more than the price boom days of 2003-2005.  The average sales prices of both homes and vacant lots also enjoyed nice increases in 2016.  The average price of a home has now steadily increased for the last 6 years and was $258,767 in 2016.  The $29,631 increase from 2015 to 2016 is the largest year to year increase since 2004 to 2005.  


There were 116 vacant lot sales with the average price increasing from $68,189 to $99,128.  (In calculating average selling prices, I excluded two larger development parcels that sold for $2,200,000 and $3,800,000.)  116 sales ranks 3rd all-time behind 122 sales in 2003 and 183 in 2004.  With the exception of a handful of beachfront lots and lots with unobstructed views, we didn't necessarily see individual lots selling for that much more than they did in 2015.  What we did see was buyers decide this was the year to purchase the higher value lots, which are those closer to the beach.  The majority of reasonably priced gulf view and waterfront lots on the market sold in 2016.  There were 34 lot sales over $100K in 2016 vs only 15 in 2015 and 26 sales over $150K vs 6 in 2015.   

On the flipside, the prices have barely moved further from the beach and you can still get a very good deal with 46 lots listed under $60K.  With this many lots still available, buyers have not had to start paying more. Many of these buyers in 2016 were able to purchase for the same or less than in 2015.  This has been true for both lots and houses further from the water.  Additionally, new spec houses added to the competition in 2016 hurting older existing homes and helped hold down values.   At least 95% of the non gulf view homes have stayed under $300K.  Here are 14 brand new "spec" houses that sold for $304K or less. The number of existing homes and lots on the market further from the beach has also gone down significantly.  2017 may finally see a shortage in lower priced properties available and lead to an increase in values for the properties further from the beach. 

The properties seeing the biggest increases over the last 2 years are the higher-end/more limited properties.  In general, this has meant those on the beach or close to the beach.  There are obviously a lot less of these properties that exist compared to the number of properties further from the water.  The number of these properties close to the water that are on the market is very scarce. I'm going to give some examples of common types of properties we have been finding for buyers the last few years and how few are left. Want a beach front single family home in Mexico Beach? Not one on the market. Beach front lot in Mexico Beach? None available. Canal front lot? Zero. Canal front single family home? Two. Beachfront condo or townhouse? Only 5 to choose from SJB or MB. Gulf view lot from Mexico Beach to St. Joe Beach under $200K? Only these 4 left . Gulf view single family home under $350K? Two left. 3BR Gulf view condo or townhouse? Down to 6 left.  There are 6 single family beachfront homes on the market from Beacon Hill to WindMark. 

We saw, by far, the highest sale of a lot in many years when a 80 foot wide beachfront lot sold in December for $575,000.  Sales in the past 5 years have been in the $240K to $410K range.  There was also a condo that sold for $520K while the previous high sale in the last 8 years has been $410K.  These buyers both paid what it took to buy a property like they wanted.  More situations like this could lead to larger price increases.  There is also a shortage of gulf view lots, gulf view condos, townhouses and every property type that is close to the beach.  These are seeing nice appreciation due to limited supply.  If you're considering selling one of these types of properties, you may be pleasantly surprised with the value, and I'd be happy to give you a free, no obligation valuation.   
Who's purchasing?  98 Real Estate dominated the Mexico Beach/St. Joe Beach/WindMark market for the 4th year in a row.  We sold 105 properties totaling over $33 million in MLS sales production for this market alone.  That was almost 2 times more than our nearest competitor. I decided to take this opportunity to survey our agents and merge their results with my own to try and come up with a synopsis about who is buying here and what are their intentions.  When it comes to homes, less than 20% of the buyers we worked with bought these homes to be their primary residences.  The remaining 80% were closely split between 2nd home purchasers with no intent to rent and those that bought with the intent to use the homes as vacation rentals.  We also broke down the vacant lots that we sold. Approximately 50% of the buyers planned to build right away or at least within 2 years or less.  The others were split between people buying to build further down the road, usually closer to retirement, and then those buying strictly as an investment.  Where are the buyers from? Once again, Georgia buyers were the large majority.  We are continuing to see some buyers from Alabama and an increase in the number of Tennessee buyers.  We also get a smaller number of buyers from other areas in the Southeast.  These go along with our snowbird purchasers as well as locals that are purchasing additional properties, usually for investment.     

A few more interesting facts from 2016:
The average seller sold for 92% of their listing price. 
The average days on market is down to 135, the lowest in 11 years.

Once again, we had a strong percentage of cash buyers.  132 out of the 298 sales were cash transactions.

The 98 Real Estate Group team has grown to 15 agents and 1 amazing office manager, Kristy Lee. 

Bonita Thompson, Regina Gossett, and Grant Terry each finished at Top 10 agents for this market.
I was able to have my best year with over $21 million in sales and as the #1 agent now for the 3rd time in the last 4 years.  Our company also had by far it's best year selling over $50 Million and trumping last year's total of $33 million which was our previous best year.  We pride ourselves on being the best company in the area and do everything we can to give buyers and sellers the best opportunities possible.  We love our new office on the corner of 33rd St. and Hwy 98 in Mexico Beach.  This office finished #1 out of 76 individual offices reporting sales on MLS.  Thank you again to everyone that trusts us with your buying and selling in our little paradise.  We will have a brand new state of the art website up and running next week and encourage you to give www.98realestategroup.com  a visit for the most informative and enjoyable real estate available. 
Don't forget the Mexico Beach Gumbo Festival is Saturday, February 18.  Make sure to come early before the gumbo is gone.  


Zach Childs 
Broker/Owner- 98 Real Estate Group
#1 Producing Real Estate Company Located in Mexico Beach-
2013, 2014, 2015, & 2016