Florida Mortgage Brokers: No Worries Over Palm Beach Housing Market

Florida mortgage brokers have a message for those that believe the Palm Beach housing market is in the middle of a major slow down: think again.

Granted, there have been fewer sales since the spring and a larger-than-usual inventory on the market. But many say the summer quiet is about to be interrupted with a rebound in home sales, for these reasons:

* Forces at work elsewhere do not apply to resort “micro-markets” such as Palm Beach.

* Baby boomers are newly liquid with retirement money and/or inheritances to invest in vacation homes; the barrier island is highly visible on their list of the most appealing places to settle.

* Florida home mortgage rates remain attractively low.

* There is pent-up demand among people who held off buying after the 2004 and ‘05 hurricanes. And to date, this storm season has been a fear-allaying reprieve.

* More people move into Florida than leave the Sunshine State; and Palm Beach is a magnet for all ages.

* Also boding well, “the rental market is stronger than I can remember,” said broker Rosalind Clarke of The Corcoran Group, who cited last year as “the worst. There’s all this new blood in town, and they don’t own property yet.”

Clarke, who has been interviewed on CNBC as an expert on Palm Beach housing market activity, said her optimism comes from “just looking at this whole market very logically. No dramas that scare people off. And people have made a lot of money in the (stock) markets.”

Although fewer homes sold this year than last, prices have held, Clarke said, because people sense that, “If you’re going to put money anywhere, you’re safe in Palm Beach.”

But Joel Naroff, chief economist for Commerce Bank and based in Cherry Hill, N.J., sounded a cautionary note.

“Some special factors are involved there; it’s a different market,” he said. “Construction has not been as totally out of control as in other parts of southeast Florida. That holds out hopes that major problems (elsewhere) might not hit as hard on the island.

“That doesn’t mean it will escape unharmed. Because you can afford it doesn’t mean you’ll be willing to pay a high price.”

But it does mean that Florida mortgage demand is never likely to remain slow. This is a popular, attractive area in which to reside for a handful of solid reasons.