The state of Florida grew by 1.9% between 2021 and 2022. An additional 706,597 people moved to the Sunshine State between 2020 and this last census. This made Florida the fastest-growing state in the US.
One of the attractions of Florida includes the weather of course. 230 days a year of sunshine help to give the state its nickname. Then there are the beaches, resorts, and activities to consider.
Perhaps the most exclusive, and certainly one of the most desirable areas in Florida is Palm Beach. In the South-eastern part of Florida lies West Palm Beach, and its neighbour, Palm Beach. Both areas are praised for quality of life and high-value real estate.
How is the Florida housing market looking in 2023?
Florida has experienced impressive rises in house prices. The price of homes rose 80% during the last five years. Analysts are now predicting the housing market to remain strong for the next five years.
Despite demand though, house sales in the state have dropped. The Florida Business Observer reported a near-40% drop in house sales at the end of 2022. This decline in sales has no reflection on demand but points to a small housing inventory.
The houses for sale inventory in Florida remains small pushing demand and price up. This shortage of existing homes has led to new construction. Miami and Orlando have led the way in building over 21,000 new units each in 2021.
Florida is third in the country for new builds. High-quality construction used for kitchens and interiors of Florida homes means that there are some very desirable properties available.
Are people investing in Palm Beach real estate now?
The demand for Palm Beach property is unlikely to drop. Unless some extremely innovative building methods are used though, the housing inventory will never meet the number of potential new residents. Anyone looking to invest in new builds in Palm Beach should learn everything about the construction industry first.
Palm Beach County as a whole though is growing. The growth rate of Palm Beach County over the last year was 1.13% – lower than the Florida average but very healthy.
2022 saw a total of 37,447 house sales across Palm Beach County. 2021 saw record house sales in the county for all types of homes including single-family homes and luxury condos. Despite 2021 being a bumper year for house sales, 2022 continued to see year-on-year increases.
Palm Beach County’s population grew from 336,706 in 1969 to 1,497,987 in 2021. Since 2015 however, the growth rate of new residents has slowed. New people continue to arrive in the county but at a much slower rate. As the county grows, so does city traffic on main routes like I-95 and Florida’s Turnpike.
While the population in West Palm Beach and Palm Beach Town grows very slowly, investment is still being made in the county as a whole.
Increasing the value of Palm Beach property
If you have a property in Palm Beach then congratulations. The median price of a house in Palm Beach in March this year was $2.8 million. This clearly demonstrates why Palm Beach remains exclusive, and why more billionaires live in this vicinity than anywhere else in Florida.
Some ways to invest in Palm Beach property or increase the value of real estate are as follows:
Understand the relationship between value and cost
Flipping homes is a popular way to enter the property market. And with areas of Palm Beach being highly sought after, finding distressed properties might be the key. Nonetheless, buying a distressed Palm Beach property is no guarantee of a strong ROI. A house flipper needs to understand which renovations bring the best returns.
With property prices being higher than the state average, buyers will expect Palm Beach homes to be of good quality. The two rooms that buyers put the most focus on are kitchens and bathrooms.
When making renovations to increase the value of a home there are many factors to be looked at. Some kitchen remodelling considerations include the quality of materials to be used. Cutting corners in Palm Beach won’t help the value of your home.
New builds
With very limited space, construction of new units will be difficult. However, new constructions are underway in West Palm Beach and investment could be rewarding. The best bet may be to look at areas close to West Palm Beach but where land is still more affordable.
Understanding the market (comparable)
AI is being used across many industries now and is making its way into property investment. AI helps people make decisions. And artificial intelligence is being used to provide real-time, accurate house valuations.
You might not have access to real estate AI tools, but you can use comparables to increase your market knowledge. Comparables in the housing market mean taking a few properties and using them to calculate the value of a similar home.
Normally, comparables work by taking between 3 and 6 very similar properties to the one needing to be valued. A property owner can take the median sales price from the comparables to value their own property.
Anyone looking to understand and invest in Palm Beach property should use comparables to get a hold of the local market.
Summary
The value of real estate in Palm Beach County varies dramatically. But, West Palm Beach city and the town of Palm Beach are home to high-value real estate.
Demand remains high in Palm Beach as the existing houses for sale inventory stays low. For sellers, this is good news. Palm Beach property prices continue to rise, and likely will for the next five years. For homeowners wishing to raise the value of their homes, kitchen renovations, and other work may be key. For potential investors in Palm Beach, a big wallet will be needed or skill at spotting distressed properties to fix and flip.
