The Pohrer Report Q2 2022

THE POHRER REPORT Q2 2022 Inside South Florida’s most exclusive real estate market.

Photographed home:| 124 Brazilian Avenue. Property GARY POHRER GARYPOHRER.COM | 1 listed by Gary Pohrer.

GARY POHRER | GARYPOHRER.COM | 2

CONTENTS 4 5 9 12 14 16 20 24

L e tt e r f ro m G a ry Poh rer S i ng l e F a mi l y H omes : Al l N ei g hbo r ho o ds S i ng l e F a mi l y H omes : N orth E nd S i ng l e F a mi l y H omes : In -Town S i ng l e F a mi l y H omes : Es ta te S e ctio n Con d os & Town h omes : Al l N ei ghbo r ho o ds Fe a t u re d In s i g h ts : Ad d i ti on al D ata to Track All Things Re al Estate I n C l o s i ng

GARY POHRER | GARYPOHRER.COM | 3

Letter From Gary “Is the market softening?”

This is a question I get on a weekly basis from clients and prospective clients. If only I had a crystal ball and could predict real estate market cycles! Although I cannot provide a definitive answer to that question, I thought it would be helpful to share some of the data and reports that I look at as leading indicators to spot trends in global and local real estate markets.

In this quarter’s report, as with all of our reports, I share actuals from the past quarter. But Q2 2022 actuals do not answer the broader market question that so many of you are eager to uncover. This is because Q2 is a lagging indicator of the market, reflecting transactions that closed in Q2 but actually moved to contract in Q4 2021, Q1 2022, and Q2 2022.

We won’t know for certain how the Palm Beach market is being impacted by macro trends such as rising interest rates, stock market upheaval, and other economic shifts until Q4 of this year or even Q1 of next year, because real estate players need time to react to how their pricing and their pocketbooks fit into the big picture. But I think you will find the data and trends I watch helpful in painting a picture of how real estate is being impacted by the rise in interest rates and Federal Reserve balance sheet tightening.

There is a lot to unpack in this quarter’s report, and the most interesting thing I found is that although some leading indicators show softening in real estate globally, Florida — specifically Palm Beach — is holding its ground and impacted to a lesser extent.

I hope you enjoy the read and as always, please don’t hesitate to reach out with any questions.

Best regards,

Gary Pohrer Executive Director of Luxury Sales Douglas Elliman 340 Royal Poinciana Way M302 Palm Beach, FL 33480 O: 561.655.8600 M: 561.262.0856 gary.pohrer@elliman.com www.garypohrer.com

REPORT CONTRIBUTORS

ABOUT GARY POHRER • Ranked in the Top 2 for Douglas Elliman agents nationwide 2020 and 2021*

Tammy Bernstein

Beth Johnson

Sales Associate

Sales Associate

GARY POHRER | GARYPOHRER.COM | 4

Elizabeth Tristan Sales Associate Market Insights Advisor

• #1 Douglas Elliman realtor in Palm Beach since 2017*

*BY 2020 AND 2021 DOUGLAS ELLIMAN REAL ESTATE SALES VOLUME AND GROSS COMMISSION INCOME. **AS RECOGNIZED BY THE DOUGLAS ELLIMAN ELLIE AWARDS FROM 2017-2021.

SINGLE FAMILY HOMES ALL NEIGHBORHOODS GARY POHRER | GARYPOHRER.COM | 5

Q2 Summary: Single Family Homes: All Neighborhoods Transaction volume was down -44% year-over-year (YOY)* in Q2, largely driven by the decrease in non-waterfront sales.

Waterfront sales YOY held strong with 13 sales in Q2 2022, compared to 14 in Q2 2021.

Total sales value* was down -10% YOY, driven by a -34% decrease in non-waterfront sales. Waterfront sales value was up +28% YOY with nearly $560M in sales value traded in Q2 2022.

Price per square foot (PPSF)* across both home size* and lot size* continues to grow YOY, and was up significantly from the same period last year: +74% (PPSF home size) and +76% (PPSF lot size).

Q2 2022

Q2 2021

% CHANGE

TRANSACTIONS

50

89

-44%

WATERFRONT

13

14

-7%

37

75

-51%

$1,000,240,155

$1,108,895,302

-10%

$559,457,000

$436,590,500

28%

$440,783,155

$672,304,802

-34%

AVERAGE SALE PRICE

$20,004,803

$12,459,498

61%

WATERFRONT

$43,035,154

$31,185,036

38%

$11,913,058

$8,964,064

33%

AVERAGE PPSF HOME

$4,477

$2,575

74%

WATERFRONT

$5,904

$4,379

35%

$3,426

$2,032

69%

AVERAGE PPSF LOT

$1,228

$698

76%

WATERFRONT

$1,703

$1,036

64%

$907

$576

57%

NON-WATERFRONT TOTAL SALES VALUE WATERFRONT NON-WATERFRONT

NON-WATERFRONT

NON-WATERFRONT

NON-WATERFRONT

GARY POHRER | GARYPOHRER.COM | 6

YEAR OVER YEAR

Inventory: Active Listings Inventory of single family homes continues to build, up +25% YOY from an average of 39 active listings in Q2 2021 to an average of 49 active listings in Q2 2022.

194

190

200

ACTIVE LISTINGS

172

150 137

130

122

100

105 58

50 39 31

Days On Market

APR-22

JAN-22

OCT-21

Single family homes stayed on the market for an average of 112 days during Q2 2022. This was down -24% from last quarter, and a YOY improvement of -34% compared to Q2 2021, when homes took an average of 169 days to sell.

5711 57

500

DAYS ON MARKET

JULY-21

112 DAYS 590

600

APR-21

JAN-21

OCT-20

JULY-20

APR-20

JAN-20

OCT-19

JULY-19

APR-19

JAN-19

OCT-18

JULY-18

APR-18

JAN-18

OCT-17

JULY-17

APR-17

JAN-17

0%

400 357 322

300

193

200 145

108 120

38 138

100 73

GARY POHRER | GARYPOHRER.COM | 7

APR-22

JAN-22

OCT-21

JULY-21

APR-21

JAN-21

OCT-20

JULY-20

APR-20

JAN-20

OCT-19

JULY-19

APR-19

JAN-19

OCT-18

JULY-18

APR-18

JAN-18

OCT-17

JULY-17

APR-17

JAN-17

0

Sale to List Ratio* In Q2 2022, single family homes sold on average -7% below the asking price, quite similar to the trends seen in the previous quarter. Homes continued to sell very close to the asking price when listed on the market.

One thing to note is that starting in June 2022, sale to list ratio dropped to 91%. It will be interesting to see if this downward trend continues throughout the summer of 2022.

105

105

100 98

SALE TO LIST RATIO

96

95 93

90

91 87

85

87

80

79

78

75

APR-22

JAN-22

OCT-21

JULY-21

APR-21

JAN-21

OCT-20

JULY-20

APR-20

JAN-20

OCT-19

JULY-19

APR-19

JAN-19

OCT-18

JULY-18

APR-18

JAN-18

OCT-17

JULY-17

APR-17

JAN-17

70

FOOTER: Glossary Year-over-year (YOY): A method of evaluating two or more measured events, comparing the results of one period with those of a comparable period on an annualized basis.

Total sales value: The sum of all sales during a period of time.

Price per square foot (PPSF): A calculation of the value of each square foot of area of a house, condo or any building. It is calculated by dividing the price by the square footage.

PPSF: Home Size: Home size is based on the current under air square footage.

PPSF: Lot Size: This is based on the PPSF of the total lot.

Sale to List Ratio: The ratio of the final sale price of a home to its list, or asking, price expressed as a percentage. If the sale to list ratio is above 100%, the home sold for more than the list price. If it’s less than 100%, the home sold for less than the list price.

GARY POHRER | GARYPOHRER.COM | 8

NORTH END SINGLE FAMILY HOMES Palm Beach’s North End, located north of Wells Road, is celebrated for quiet seclusion. Thanks to zoning laws that prohibit condos and commercial properties in this area, many residents enjoy private beachfront views.

GARY POHRER | GARYPOHRER.COM | 9

Q2 Summary: Single Family Homes: North End Transaction volume was down -32% YOY for the second quarter of 2022. This is largely driven by non-waterfront home sales declining on the North End, which were down -38%. Waterfront transactions are up slightly, at +20% YOY. Total sales value* was up +25%, driven by large transaction volume on several waterfront properties. Non-waterfront total sales value was down -16% YOY. PPSF: Home was up +102% in Q2 YOY. Additionally, PPSF: Home increased quarter-over-quarter (QOQ)* +30%.

We do not see weakening in what people are willing to pay for homes on the North End.

Q2 2022 TRANSACTIONS WATERFRONT NON-WATERFRONT TOTAL SALES VALUE WATERFRONT NON-WATERFRONT

Q2 2021

% CHANGE YEAR OVER YEAR

30

44

-32%

6

5

20%

24

39

-38%

$559,275,030

$447,930,547

25%

$281,777,000

$118,115,000

139%

$277,498 ,030

$329,815,547

-16%

AVERAGE SALE PRICE

$18,642,501

$10,180,240

83%

WATERFRONT

$46,962,833

$23,623,000

99%

$11,562,418

$8,456,809

37%

NON-WATERFRONT AVERAGE PPSF HOME

$4,602

$2,275

102%

WATERFRONT

$6,937

$3,922

77%

$3,430

$1,977

73%

AVERAGE PPSF LOT

$1,062

$588

81%

WATERFRONT

$1,462

$884

65%

$831

$525

58%

NON-WATERFRONT

NON-WATERFRONT

GARY POHRER | GARYPOHRER.COM | 10

Most Recent North End Sales WATERFRONT?

SF HOME SIZE

PPSF ($)

SF LOT SIZE

PPSF ($)

APPROX.

HOME SIZE

APPROX.

LOT SIZE

$85,977,000 901 N OCEAN BOULEVARD

YES

10,655

$8,069

49,319

$1,743

$56,000,000

325 VIA LINDA

YES

7,731

$7,244

41,447

$1,351

$44,375,000

1320 N LAKE WAY

YES

6,266

$7,082

28,057

$1,582

$39,900,000

1020 N LAKE WAY

YES

6,548

$6,093

20,321

$1,964

$32,525,000

1494 N LAKE WAY

YES

7,231

$4,498

34,243

$950

$23,000,000

1265 N LAKE WAY

YES

2,190

$10,502

19,319

$1,191

$20,826,140

134 CASA BENDITA

NO

5,841

$3,566

18,069

$1,153

$19,000,000

9 VIA LOS INCAS

NO

5,088

$3,734

17,498

$1,086

$18,450,000

225 SANDPIPER DRIVE

NO

4,436

$4,159

19,201

$961

$16,225,000

301 POLMER PARK

NO

6,365

$2,549

37,880

$428

$16,100,000

300 INDIAN ROAD

NO

4,855

$3,316

14,248

$1,130

$15,500,000

215 INDIAN ROAD

NO

4,573

$3,389

12,981

$1,194

$14,500,000

225 PLANTATION ROAD

NO

3,812

$3,804

10,999

$1,318

$13,550,000

268 JAMAICA LANE

NO

4,065

$3,333

11,186

$1,211

$12,500,000

308 ARABIAN ROAD

NO

4,098

$3,050

13,264

$942

$11,825,000

1198 N OCEAN WAY

NO

1,691

$6,993

19,937

$593

$11,632,240

269 QUEENS LANE

NO

3,086

$3,769

9,400

$1,237

$11,500,000

255 RIDGEVIEW DRIVE

NO

3,523

$3,264

11,500

$1,000

$10,890,000

134 SEAGATE ROAD

NO

3,498

$3,113

10,589

$1,028

$10,350,000

224 LA PUERTA WAY

NO

2,288

$4,524

12,497

$828

$9,450,000

232 MOCKINGBIRD TRAIL

NO

2,420

$3,905

12,645

$747

$8,376,000

265 LA PUERTA WAY

NO

2,181

$3,840

12,493

$670

$8,000,000

274 MONTEREY ROAD

NO

2,877

$2,781

13,499

$593

$7,773,650

515 N LAKE WAY

NO

3,023

$2,572

12,092

$643

$7,750,000

269 JAMAICA LANE

NO

2,628

$2,949

11,299

$686

$7,200,000

216 SOUTHLAND ROAD

NO

2,825

$2,549

12,720

$566

$6,750,000

220 ARABIAN ROAD

NO

2,461

$2,743

11,217

$602

$6,650,000

1171 N OCEAN WAY

NO

1,375

$4,836

9,727

$684

$6,500,000

223 MONTEREY ROAD

NO

1,904

$3,414

8,999

$722

$6,200,000

250 BAHAMA LANE

NO

1,984

$3,125

10,171

$610

SALE PRICE

ADDRESS

FOOTER: Glossary Total sales value: The sum of all sales during a period of time.

GARY POHRER | GARYPOHRER.COM | 11

IN-TOWN SINGLE FAMILY HOMES Nestled between Worth Avenue and Wells Road lies the energetic center of Palm Beach Island, In-Town. Packed with shops, secluded beaches, and five-star restaurants, this hub of culture and leisure lures residents with a flair for cosmopolitan life.

GARY POHRER | GARYPOHRER.COM | 12

Q2 Summary: Single Family Homes: In-Town In-Town transaction volume was down -50% YOY in Q2 2022, the fourth consecutive quarter that saw a decline in transaction volume.

Sales value was also down -6% YOY at $112M in Q2 2022, compared to $119M in Q2 2021.

In-Town PPSF: Home was up +70% YOY, whereas PPSF: Lot was up +80%. Note, we saw a decline in PPSF QOQ for In-Town properties. PPSF: Home was down -4% QOQ and PPSF: Lot was down -20% QOQ. We will continue to watch this metric as we enter into the second half of the year as a possible indicator of softening prices due to the macroeconomic climate.

Q2 2022

Q2 2021

% CHANGE

10

20

-50%

TOTAL SALES VALUE

$112,935,125

$119,906,955

-6%

AVERAGE SALE PRICE

$11,294,513

$5,995,348

88%

AVERAGE PPSF HOME

$3,101

$1,820

70%

AVERAGE PPSF LOT

$1,129

$627

80%

TRANSACTIONS

YEAR OVER YEAR

62 Most Recent In-Town Sales ADDRESS

WATERFRONT?

SF HOME SIZE

PPSF ($)

SF LOT SIZE

PPSF ($)

APPROX.

HOME SIZE

APPROX.

LOT SIZE

$21,500,000

120 DUNBAR ROAD

NO

4,846

$4,437

19,763

$1,088

$21,000,000

151 CHILEAN AVENUE

NO

5,119

$4,102

12,502

$1,680

$14,900,000

449 AUSTRALIAN AVENUE

NO

3,597

$4,142

7,000

$2,129

$14,750,000

177 CLARKE AVENUE

NO

8,261

$1,785

18,879

$781

$9,750,000

318 SEASPRAY AVENUE

NO

4,316

$2,259

12,249

$796

$9,000,000

142 SEABREEZE AVENUE

NO

2,591

$3,474

7,658

$1,175

SALE PRICE

$8,500,000

144 CHILEAN AVENUE

NO

2,577

$3,298

10,001

$850

$6,225,000

329 SEABREEZE AVENUE

NO

2,028

$3,070

6,125

$1,016

$4,973,125

400 SEASPRAY AVENUE

NO

2,144

$2,320

4,125

$1,206

$2,337,000

149 ROOT TRAIL

NO

936

$2,497

1,708

$1,369

NOTE: Reporting in this section does not break out waterfront versus non-waterfront properties, as there are limited waterfront sales in this area. In most years, zero waterfront homes sold.

FOOTER: Glossary Quarter-over-quarter (QOQ) The measure of an investment or a company’s growth from one quarter to the next.

GARY POHRER | GARYPOHRER.COM | 13

ESTATE SECTION SINGLE FAMILY HOMES The Estate Section comprises all residences south of Worth Avenue to Sloans Curve.

It is renowned for its opulent residencies and exclusive social clubs including The Everglades Club, Bath and Tennis Club, and Mar-a-Lago.

GARY POHRER | GARYPOHRER.COM | 14

Q2 Summary: Single Family Homes: Estate Section Activity in the Estate Section continues to trend down significantly YOY. In Q2 of 2022, transaction volume was down -58% and total sales value was down -37%. This is the second consecutive quarter we saw YOY decline in total sales value.

Although sales activity was down, we still saw significant growth across average sale price and PPSF. PPSF: Home was up +57% YOY and PPSF: Lot was up +109% YOY. These metrics were also up significantly QOQ (+46% and +133% respectively), which shows the market remains strong in regards to the prices people are willing to pay to own in the Estate section.

Q2 2022

Q2 2021

% CHANGE YEAR OVER YEAR

TRANSACTIONS

10

24

-58%

WATERFRONT

7

8

-13%

3

16

-81%

NON-WATERFRONT

$328,030,000

$520,057,800

-37%

$277,680,000

$297,475,500

-7%

$50,350,000

$222,582,300

-77%

AVERAGE SALE PRICE

$32,803,000

$21,669,075

51%

WATERFRONT

$39,668,571

$37,184,438

7%

$16,783,333

$13,911,394

21%

TOTAL SALES VALUE WATERFRONT NON-WATERFRONT

NON-WATERFRONT AVERAGE PPSF HOME

$5,010

$3,196

57%

WATERFRONT

$5,129

$4,609

11%

$4,442

$2,267

96%

$1,747

$837

109%

$2,045

$1,087

88%

$640

51%

NON-WATERFRONT AVERAGE PPSF LOT WATERFRONT NON-WATERFRONT

$968

Most Recent Estate Section Sales SALE PRICE

ADDRESS

WATERFRONT?

SF HOME SIZE

PPSF ($)

SF LOT SIZE

PPSF ($)

APPROX.

HOME SIZE

APPROX.

LOT SIZE

$72,850,000

102 JUNGLE ROAD

YES

12,352

$5,898

33,341

$2,185

$48,500,000

1030 S OCEAN BOULEVARD

YES

10,100

$4,802

25,378

$1,911

$46,000,000

662 ISLAND DRIVE

YES

7,600

$6,053

27,012

$1,703

$31,250,000

640 ISLAND DRIVE

YES

6,623

$4,718

18,652

$1,675

$27,750,000

460 S OCEAN BOULEVARD

YES

5,954

$4,661

7,710

$3,599

$25,750,000

576 ISLAND DRIVE

YES

5,558

$4,633

15,973

$1,612

$25,580,000

466 S OCEAN BOULEVARD

YES

5,954

$4,296

7,714

$3,316

$23,850,000

101 GULFSTREAM ROAD

NO

5,194

$4,592

13,974

$1,707

$17,000,000

145 CLARENDON AVENUE

NO

4,237

$4,012

24,163

$704

$9,500,000

114 OCEANVIEW ROAD

NO

1,904

$4,989

13,904

$683

CONDOS &

TOWN HOMES

ALL NEIGHBORHOODS Whether you seek a large building with resort-style amenities or the boutique elegance of a small, full-service site, Palm Beach Island offers an expansive range of options just steps from shorelines, shops, restaurants and more. Palm Beach townhomes are ideal for those who seek the convenience of a condo but crave the spaciousness of a house.

GARY POHRER | GARYPOHRER.COM | 16

Q2 Summary: Condominiums and Townhomes Transaction volume in Q2 was down -49% YOY. We are finally starting to see transactions on the South End of the island slow, similarly to what we’ve seen on In-Town transactions for the past few quarters.

Total sales value was down -15% YOY largely driven by a decline in sales value on South End transactions. In-Town sales value was nearly flat YOY. As with single family homes, PPSF for In-Town condos and townhomes continued to rise with +81% YOY growth, hitting a record $2,427 PPSF.

Q2 2022

Q2 2021

% CHANGE

TRANSACTIONS

175

342

-49%

IN-TOWN

47

91

-48%

SOUTH END

128

251

-49%

TOTAL SALES VALUE

$346,943,866

$406,722,470

-15%

IN-TOWN

$169,356,907

$166,956,823

1%

SOUTH END

$177,586,959

$239,765,647

-26%

AVERAGE SALE PRICE

$1,982,536

$1,189,247

67%

IN-TOWN N

$3,603,338

$1,834,690

96%

SOUTH END

$1,387,398

$955,242

45%

$1,225

$754

62%

$2,427

$1,344

81%

$832

$578

44%

AVERAGE PPSF IN-TOWN SOUTH END

YEAR OVER YEAR

In Q2 2022, inventory was down -31% YOY; Q2 2021 averaged 89 active listings per month, whereas Q2 2022 averaged 61 active listings per month.

Active listings were up ever so slightly QOQ in Q2 2022, rising to 61 from 56 in Q1 2022 .

We will continue to watch QOQ inventory behavior as an indication of whether the market is softening and inventory is beginning to build.

Inventory: Active Listings 400

ACTIVE LISTINGS

350 339

332

333

323

300

276

250

250 250

236

246

200

199

150 100

64

APR-22

OCT-21

JAN-22

74

64 JULY-21

JAN-21

JULY-20

OCT-20

APR-20

JAN-20

OCT-19

JULY-19

APR-19

JAN-19

OCT-18

JULY-18

APR-18

JAN-18

OCT-17

JULY-17

APR-17

JAN-17

GARY POHRER | GARYPOHRER.COM | 17

APR-21

75

50

53

Days on Market

104 DAYS The number of days on market continued to decline in Q2 2022, reaching an average of 104 days.

This is a -41% decrease from the same period last year, when properties stayed on the market for an average of 177 days.

400 365

350 305

300

300 250

232

200

229

228

245

254

209

201

204

219

185

204 176

175 148

147

142

100

127

151 97

JAN-22

APR-21

JAN-21

OCT-20

JULY-20

APR-20

JAN-20

OCT-19

JULY-19

APR-19

JAN-19

OCT-18

JULY-18

APR-18

JAN-18

OCT-17

JULY-17

APR-17

JAN-17

50

OCT-21

91

APR-22

150 173

JULY-21

DAYS ON MARKET

325

Sale to List Ratio* 100

97

96

93

95 933

91

90

90

94 93

88 8 8

90

92

88 86 83

APR-22

JAN-22

APR-20

JAN-20

OCT-19

JULY-19

APR-19

JAN-19

OCT-18

JULY-18

APR-18

JAN-18

OCT-17

JULY-17

APR-17

JAN-17

70

OCT-21

The sale to list ratio for condos and townhomes hovered right around 95% for Q2 2022, largely due to limited inventory and little room to negotiate on list prices. This has been consistent the past few quarters.

75

GARY POHRER | GARYPOHRER.COM | 18

95%

JULY-21

80

86

APR-21

83

JAN-21

85

84

OCT-20

85

JULY-20

SALE TO LIST RATIO

98

97

96

Most Recent Condo & Townhome Sales ADDRESS

SF UNIT SIZE

$18,600,007

219 BRAZILIAN AVENUE

5,098

$3,648

$15,000,000

101 WORTH AVENUE, 0031

4,130

$3,632

$12,250,000

2 N BREAKERS ROW N, 32

3,020

$4,056

$10,625,000

110 SUNSET AVENUE E, 3 A

4,609

$2,305

$9,020,000

400 S OCEAN BOULEVARD, PH D

2,749

$3,281

$8,500,000

360 S OCEAN BOULEVARD, 0032

2,700

$3,148

$6,850,000

200 BRADLEY PLACE, 206

2,648

$2,587

$6,500,000

150 BRADLEY PLACE, 0906

2,144

$3,032

$6,464,000

130 SUNRISE AVENUE, PH 4

2,434

$2,656

$6,150,000

100 WORTH AVENUE, 315

2,137

$2,878

$6,005,000

330 COCOANUT ROW, 0041

3,080

$1,950

$5,650,000

330 S OCEAN BOULEVARD, 0054

2,406

$2,348

$5,145,000

100 SUNRISE AVENUE, 413

1,780

$2,890

$4,100,000

330 S OCEAN BOULEVARD, 0015

1,996

$2,054

$3,969,000

330 S OCEAN BOULEVARD, 0012

1,996

$1,988

$3,900,000

100 WORTH AVENUE, PH 15

1,590

$2,453

$3,780,000

100 WORTH AVENUE, 404

1,539

$2,456

$3,600,000

300 S OCEAN BOULEVARD, 1B

2,346

$1,535

$2,850,000

227 AUSTRALIAN AVENUE, 0052

1,287

$2,214

$2,500,000

170 CHILEAN AVENUE, 6A

1,201

$2,082

$2,500,000

44 COCOANUT ROW, 510A

1,748

$1,430

$2,400,000

201 EVERGLADE AVENUE, 206

1,440

$1,667

$2,350,000

227 AUSTRALIAN AVENUE, 0032

1,287

$1,826

$2,230,000

354 CHILEAN AVENUE, 0041

1,193

$1,869

$1,925,000

146 SUNSET AVENUE, C

1,047

$1,839

$1,400,000

354 CHILEAN AVENUE, 0045

782

$1,790

$1,300,000

223 ATLANTIC AVENUE, B4

804

$1,617

$1,300,000

223 ATLANTIC AVENUE, A3

953

$1,364

$1,250,000

220 ATLANTIC AVENUE, 0030

646

$1,935

SALE PRICE

APPROX.

PPSF ($) UNIT SIZE

$1,126,000

44 COCOANUT ROW, 101A

1,200

$938

$1,125,000

220 ATLANTIC AVENUE, 0050

646

$1,741

44 COCOANUT ROW, 307A

900

$889

$800,000

GARY POHRER | GARYPOHRER.COM | 19

FEATURED

INSIGHTS ADDITIONAL DATA TO TRACK ALL THINGS REAL ESTATE The following is an analysis of supplemental data we evaluate to keep a pulse on all aspects of the real estate market.

GARY POHRER | GARYPOHRER.COM | 20

Average 30-Year Fixed Mortgage Rate The average 30-Year fixed mortgage rate has made a massive move up, increasing more than 100% in the last 12 months.

However, it still remains on the lower end when looking at it in comparison to the last 40+ years.

20.00 8 00 18.00 16.00

INTEREST RATE (%)

14.00 12.00 10.00 8.00 6.00 4.00 2.00

GARY POHRER | GARYPOHRER.COM | 21

2

9

02 /2 06

06

06

/2

/2

01

01

6

3 01 /2 06

25%

20%

15%

10%

5%

US

2

2

2

07

/2

02

02 /2

04

02

01

/2

02 /2 10

07

/2

02

1

1

1 /2

02

1 04

02 /2 01

02 /2

10

07

/2

02

0

0

0 02

0 02

01

/2

04

/2 01

/2 10

/2

01

9

9

9 07

04

/2

01

9 01

01

/2

01 /2

10

07

/2

01

8

8

8 01

8

/2 04

01 /2

01

10

/2

01

7

0%

Source: https://fred.stlouisfed.org/series/MORTGAGE30US Source: Zillow Data Center.

/2

The share of listings with a price cut refers to the number of unique properties with a list price at the end of the month that’s less than the list price at the beginning of the month, divided by the number of unique properties with an active listing at some point during the month.

% OF LISTINGS WITH A PRICE DECREASE

For many months, South Florida was consistently trailing below the national average for share of listings with a price cut. In recent months, this has shifted and it’s now trending on par with the national average.

01

00 06

Share of Listings with a Price Cut Price cuts have really begun to trend upward on listings in the last three months in South Florida and across the United States, from below 10% to above 20%. While we don’t have data specific to Palm Beach Island, we believe these broader numbers are an interesting early indicator, as price cuts suggest properties are not moving as quickly and sellers are lowering prices and price expectations.

0

7

4 /2 06

06

06

/2

/2

00

00

1

8

5 /1 06

06

06

/1

/1

99

99

99

2

9

6

98

98

/1 06

98

98

97

97

3 /1 06

/1 06

7 /1 06

4 /1 06

1

/1

/1

97

06

06

0

0.00

South Florida

United States New Home Sales A sale of the new house occurs with the signing of a sales contract or the acceptance of a deposit. The house can be in any stage of construction: not yet started, under construction, or already completed.

New home sales account for about 10 percent of the US housing market.

100 DAYS

Sales of new single family houses in the U.S. plunged -12.6% month-over-month to a seasonally adjusted annualized rate of 511K in July of 2022. This was the lowest reading since January of 2016 and well below forecasts of 575K, amid rising borrowing costs, prices and a fall in demand. Sales fell in the Midwest (-20.6%), the West (-13.3%), and the South (-12.1%) but rose in the Northeast (13.3%). Note: the South is showing the slowest decline, which might suggest why we’re not quite feeling the impact yet in Palm Beach.

1200

800

600

400

United States New Construction Spending

2022

4 3

3 2 1

1.6 1

1

.09

1

1

.08 .03 .01

0 -1

-1.1

JUN 2022

MAY 2022

APR 2022

MAR 2022

FEB 2022

JAN 2022

DEC 2021

NOV 2021

OCT 2021

SEP 2021

AUG 2021

-2

Source: US Census Data. (https://tradingeconomics.com/united-states/new-home-sales) Source: US Census Date.

GARY POHRER | GARYPOHRER.COM | 22

2020

2018

June 2022 represented the first month in the last 12 months where we saw a month-over-month decrease in construction spending in the United States.

It fell by -1.1% from the previous month to a seasonally adjusted annual rate of $1.76 trillion (USD).

US CONSTRUCTION SPENDING +/-

Construction Spending refers to monthly estimates of the total dollar value of construction work done on new structures or improvements to existing structures for private and public sectors each month in the United States.

2016

200 2014

NEW HOME SALES

1000

Housing Starts Housing Starts refer to the number of new residential construction projects that have begun during any particular month.

Estimates of housing starts include units in structures being totally rebuilt on an existing foundation.

Housing starts in the United States tumbled -9.6% month-over-month to an annualized rate of 1.446 million units in July of 2022, the lowest since February of 2021 and well below market expectations of 1.54 million. The housing sector has been cooling down amid soaring prices of materials and rising mortgage rates. Single family housing starts sank -10.1% to 916,000, the lowest level since June 2020. Starts for units in buildings with five units or more slipped -10% to 514,000.

Starts were lower in the Midwest (down -33.8% to 139,000), the South (down -18.7% to 710,000), and in the West (down -2.7% to 367,000) but rose in the Northeast (+65.5% to 230,000).

Note, it has not dropped to the levels we saw during the early Covid uncertain period of 2020.

US NEW HOME STATS

2000 1800 1600 1400 1200 1000

Source: US Census Date.

GARY POHRER | GARYPOHRER.COM | 23

2022

2020

2018

2016

2014

800

In Closing We appreciate you taking the time to read our report, and hope you found our insights on the Palm Beach Island market helpful.

Based on the actual real estate transaction data for Palm Beach, the market still appears to be strong, with the exception of the low inventory challenges we’ve experienced for the last several quarters.

Additionally, we hope you find the new insights and macro trends on the overall housing market interesting. The national outlook they provide has us cautiously optimistic about Palm Beach real estate. The indicators suggest a slowdown in the overall real estate market.

That being said, we’re not quite feeling it yet in Palm Beach.

Demand remains strong and the prices people are willing to pay to own a piece of the Island continues to inch up. I don’t want to say Palm Beach is immune, but it does have unique traits in its favor that help it withstand some of the economic storms we’ve endured over the last 40+ years. Our inventory is finite, the town and culture of Palm Beach is one of the best warm weather destinations in Florida, and people are moving here for flexible work setups, major corporate expansions, and no state income tax.

Thank you again for reading our report. If you have any feedback for us, we’d love to have it, as we are always looking for new ways to break down the data in more interesting or accessible ways.

Warmest wishes,

Gary Pohrer Executive Director of Luxury Sales Douglas Elliman 340 Royal Poinciana Way M302 Palm Beach, FL 33480 O: 561.655.8600 M: 561.262.0856 gary.pohrer@elliman.com www.garypohrer.com

Source: Above data is pulled from Palm Beach MLS, The Beaches MLS and the Palm Beach Property Appraisers (PAPA).

Specifically, we are only looking at transactions located in the 33480 zip code.

340 ROYAL POINCIANA WAY, M302, PALM BEACH, FL 33480. 561.655.8600 © 2022 DOUGLAS ELLIMAN REAL ESTATE. ALL MATERIAL PRESENTED HEREIN IS INTENDED FOR INFORMATION PURPOSES ONLY. WHILE, THIS INFORMATION IS BELIEVED TO BE CORRECT, IT IS REPRESENTED SUBJECT TO ERRORS, OMISSIONS, CHANGES OR WITHDRAWAL WITHOUT NOTICE. ALL PROPERTY INFORMATION, INCLUDING, BUT NOT LIMITED TO SQUARE FOOTAGE, ROOM COUNT, NUMBER OF BEDROOMS AND THE SCHOOL DISTRICT IN PROPERTY LISTINGS SHOULD BE VERIFIED BY YOUR OWN ATTORNEY, ARCHITECT OR ZONING EXPERT. EQUAL HOUSING OPPORTUNITY.

GARY POHRER | GARYPOHRER.COM | 24

GARY POHRER | GARYPOHRER.COM | 25