It’s not often that the things I write for you make me sit back and say, hmm. Even less often do the results I get as an analyst make me shake my head. I have done this sort of work for a long time, you know. Like many people in real estate, this is my second career. I spent many years playing around with big datasets. I know how to do that. So when I get the answer, I move on.
But when I get an answer that really makes me question my own competencies, the only thing I can really do is repeat the analysis and see if I get the same answer the second time. And if I am getting my information from the right source, well, facts are stubborn things.
Well here are the facts.
Something strange is going on in the single family house market in Wilton Manors and adjacent neighborhoods. I wrote about it briefly in my Yearbook last year and have mentioned it in passing in a couple columns. But when I looked at these numbers, it just flashed red at me.
There is a certain expectation of performance in a healthy real estate market. Buyer interest increases, prices increase, sales increase, more properties become available as owners see their neighbors get good sales prices. Ultimately you reach a stable point. Buyers move on, interest wanes, prices drop, fewer homes are available, and a new balance is achieved. Lather rinse repeat.
But what have we been seeing in WilMa and the nearby areas?
The two tables here tell the story. Let’s look first at the sales volume table. I’ve included the three WilMa neighborhoods (west of Andrews, Andrews to Dixie, and east of Dixie), as well as the adjacent neighborhoods of Oakland Park Corals, Poinsettia Heights, Middle River Terrace/Lake Ridge, and South Middle River.
Looking at sales counts for 1Q17 versus 1Q16 and 1Q15, what do you see?
Compared with first quarter last year, sales are, generally, flat to down. In East Wilton and Poinsettia Heights, they are down significantly. In Center WilMa and Oakland Park Corals, they are down sharply from the levels of 2015.
But on the other hand, take a look at the prices and say ka-ching! Prices continue to skyrocket. Now, Oakland Park Corals and Middle River Terrace/Lake Ridge did see small declines in median prices compared with 1Q16. All the other neighborhoods saw significant increases, with South Middle River leading the way with a 28.5-percent increase compared with the same quarter last year.
How is this possible? It just doesn’t make sense. Unless one of the following three things is happening:
1. We are going to see strong sales volume in the second quarter.
2. We are at or near the peak in prices for this cycle.
3. Buyers have lost interest in WilMa and the surrounding neighborhoods and are moving on.
James Oaksun, Broward's Real Estate Geek(SM), is Broker-Owner of New Realty Concepts in Oakland Park. In addition to having degrees from Dartmouth and Cornell, he is a Graduate of the Realtor Institute (GRI).