Happy New Year – 2010 turned out to be a banner sales year on the island.  With 2009 the year of stabilization and improvement, 2010 was the year of the market poised to turn up, 2011 will be the year of a modest increase in prices.  December 2010 sales were 36( SF-20, Con-14, Dup-1 & Lot-0) up 29% over December 2009 at 28 ( SF-12, Con-14, Dup-2, & Lot-0).  Sales for 2010 were 317 (SF-185, Con-94, Dup-23 & Lot-15) up 35% over 2009 at 234 (SF-118, Con-94, Dup-10 & Lot-12).  Sales for 2010 were the highest since 2005, the peak year on the island, with sales of 478.  To put that in perspective, sales for 2006 were 166, 2007, 184, 2008 were 211 and of course 2009 were 234.  Of the 317 properties sold in 2010, 91(SF-46, Con-32, Dup-11 & Lot-2) have been Distressed (short sales or bank owned) properties or 28% of the sales.  Compared to 2009 when of the 234 sales, 43 (SF-15, Con-22, Dup-4 & Lot-2) were Distressed properties or 18% of the sales.  Distressed properties are currently at 36 (SF-16, Con-14, Dup-5 & Lot-1) which is about 6% of the inventory.  Pending sales (properties under contract) are down a little from previous months to 38 (SF-19, Con-15, Dup-1 & Lot-3) but still healthy.  Island Real Estate had another strong month in December with 10 properties closed and 6 new contracts.  Inventory on the island is currently at 518 (SF-256, Con-178, Dup-35 & Lot-49).  The island inventory has been holding at around the very low 500’s for the past five months.
As you have seen, sales were very good last year in our island vacation market but that has been true across the country in vacation home markets.  I’ve included an article from the Wall Street Journal on January 10, 2011 “Market for Vacation Homes On the Rise”.  The article states that “Sales in many vacation communities across the U.S. soared last year to levels not seen since the boom times, driven by deep discounts, cash purchases and buyers rising stock portfolios.”  Examples are Hilton Head Island S.C. rose 14% and Palm Beach, FL. Experienced a 40% annual increase in sales.  They go on to say “The question now is whether the momentum will last.  The strength of second-home sales paints a stark contrast to the overall housing market, which is expected to worsen in 2011”.  “The proverbial train has left the station,” said Ned Monell, an agent with Sotheby’s International Realty in Palm Beach.  “We haven’t felt energy like this in a long time.  Buyers sense that they’ve been on the sidelines long enough.”  Read the full article at the end of the newsletter.
Two more properties from Frank & Al’s Great Buy’s were put under contract since the last newsletter, 612 N Bay Blvd. and 3210 6th Ave (Palm Isle Village).  At Palm Isle Village that leaves only three units left (3205, 3204 & 3201) and these units have the lowest cost of ownership of anything on the island especially in the $300K – $500K price range.  If you check out the Great Buy’s sheet I’ve listed several that have either great rental income or have the potential, with minor improvements, to have great rental income.  If you’re looking for an investment home or a second home that will pay the operating expenses and a large part of the mortgage than check out the last four properties on the list.  A great canal buy is 618 Hampshire Lane listed at $695,000.  It fronts on the golf course and backs up to the large canal off  Bimini Bay which feeds most of the canals in Key Royale.  The only downside is it’s next to our house (only kidding, just wanted to see if you were awake).
In summary, sales of property on the island have continued to increase from 2006 at 160 properties to 2010 with 317 properties sold, well above the average of 250 and the highest level since 2005 (478) and almost equal to 2003 (325).  The average sale price of single family homes and multi-family homes look poised to start trending up while condos still have a way to go.  The inventory is very close to normal levels.  The next thing to look for is a drop below 500 and at that point it should start to drive up sales prices.
# Sold Lowest  Highest Avg. Price Sold Median Price Sold
HOMES 185 $154,000 $2,350,000 $512,596 $465,000
CONDOS 94 $29,000 $1,667,000 $292,077 $239,450
DUPLEXES 23 $170,000 $1,360,000 $392,326 $357,500
LOTS 15 $200,000 $850,000 $406,727 $345,000

# Sold Lowest  Highest Avg. Price Sold Median Price Sold
HOMES 118 $160,000 $950,000 $518,276 $452,500
CONDOS 94 $109,900 $1,700,000 $353,806 $282,250
DUPLEXES 10 $181,000 $505,000 $399,083 $379,829
LOTS 12 $287,000 $850,000 $414,350 $355,000
Keep those calls and e-mails coming!  We love hearing from you……Alan & Frank