Key West Luxury Real Estate Forecast

KEY WEST, Fla. - Aug. 15, 2022 - PRLog -- Per Gary McAdams, a second-generation Florida Realtor since 2001.Your guild to everything Real Estate.

The Key West luxury real estate forecast is currently quite strong. There are over 260 homes for sale in the community, ranging from $156,000 to $9.5 million. Presently, the median listing price in Key West stands at 1.2 million, with a meeting list price per square foot of $926, and a median selling price of $950,000. These figures represent a 34.3% increase in a year-over-year comparison, which is very impressive, to say the least. Also, the sale-to-list price ratio remains very high at 99.02%, meaning listings are selling for less than 1% under their asking price, or almost near parity with their listing price.

Presently, Key West is considered to be in a hot seller's market, greatly favoring homeowners and property investors seeking to upgrade or relocate. Buyers are in somewhat of a predicament at this time, because there are more active people looking to purchase real estate than there is available inventory. However, this dynamic is likely to change over the coming months, to a few factors, including rising inflation, rising interest rates, shortage of labor and building materials, and the possible reintroduction of distressed properties or foreclosures and short sales.

First and foremost, inflationary pressures are already straining personal budgets, which will no doubt cause fewer people to buy. Combined with rising interest rates, which the Federal Reserve has announced it will do incrementally over the next several months, it means few mortgage applications and fewer refinances. These two issues alone help cool the local luxury real estate market in Key West.

Then, there's the matter of the scarcity of new construction, which continues to be a persistent problem, given supply chain interruptions that make building materials scares and the ongoing labor shortage as well. Additionally, most foreclosure and short sale processes were halted during the shutdown and are only now really getting back underway. So, if distressed properties trickle onto the market, that will help increase inventory. But, if too many floods the market too quickly, that may add a high saturation level, pushing the community into a buyer's market.

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