Consumers already apprehensive about affordable housing in South Florida will take little comfort in the latest price increases for existing single-family homes.
The median price in Palm Beach, Broward and Miami-Dade counties hit $318,000, an 11 percent boost from the first quarter of 2016, the Florida Realtors trade group said Monday.
“With wages increasing at about 2.5 percent a year, to have home prices increase almost five times that really is not sustainable in the long term,” said Adam DeSanctis, spokesman for the National Association of Realtors.
The problem is particularly acute for teachers, police officers, firefighters and other public sector employees whose salaries historically have failed to keep pace with housing costs.
In three years, South Florida’s median price has shot up 25 percent, Realtor data show. The median price in the first quarter of 2014 was $255,000.
“Buyer demand continues to increase, yet the inventory of homes for sale remains tight in many local markets,” Florida Realtors President Maria Sales said in a statement. “That’s putting upward pressure on median prices and sometimes results in multiple offers.”
South Florida buyers looking for low- to mid-priced homes are particularly frustrated. In some areas, prices are rising so quickly that appraisals aren’t keeping up with agreed-upon sales prices, real estate agents say.
“It’s a battle,” said Judy Trudel, an agent who sells in Broward and Palm Beach counties. “I’m afraid that prices are rising a little too fast. It’s an issue, but we have to deal with it because it’s reality.”
In the city of Hollywood, the median sale price for the first quarter rose 18 percent from a year earlier to $282,500, according to the Greater Fort Lauderdale Realtors. Davie’s median rose 12 percent to $422,500, while Fort Lauderdale saw a 9 percent jump to $321,000.
Statewide, the median price for single-family homes in the first quarter was $226,000, up 11 percent from a year earlier, the Florida Realtors said. The national median price grew 7 percent to $232,100. The median means half the homes sold for more and half for less.
Some metro areas with solid job gains are seeing big bumps in buyer demand, but there aren’t enough homes to go around, in part because of a lack of new construction, the national trade group said.
Jaimie Ross, CEO of the Florida Housing Coalition, said out-of-reach home prices eventually could cost the region stable working-class professionals.
“Those tend to be people who want to be homeowners, and they will say, ‘If I can’t be a homeowner in this community, maybe I should move,’” Ross said.
South Florida’s double-digit increase in the first quarter “is a sign that the market is getting too frothy,” said Ken Johnson, an economist and professor at Florida Atlantic University.
Still, Johnson said he isn’t worried about another market bubble because he’s convinced that consumers have learned from the last decade’s housing collapse and will be less likely to get in over their heads.
“They’ve seen this movie before,” Johnson said. “They’ll be more hesitant to pull the trigger on a property.”
Powers@Sun-Sentinel.com, 561-243-6529 or Twitter @PaulOwers