First, I break up the properties in Destin into three sectors: Vacant Land, Detached Single Unit, and Condominiums.

I expect inventory in the Det. SFR sector in Destin to increase. It’s steadily increased the past three months. Beginning in April, inventory will decrease due to seasonal influences. I think there will be a nice jump in February sales. I suggest getting the early jump and contract in January. Investors are more cautious and picky. Focus will be on the premium homes; water front, beach access, and PUDs. Volume will be less than last year. The median sale price will stabilize towards the summer.  From October 2011 through October 2012 Destin averaged 30 homes sales per month. From October 2012 through October 2013 Destin has averaged 35 sales per month. I expect the average monthly sales to decline.

I’m concerned about rising interest rates. Most of Destin owners are out of state. These are second homes. Higher loan rates are expected as there is more risk. I’m hopeful the new Fed chairwoman will keep rates as low as possible for as long as possible. The housing recovery in Destin began in 2012 as investors aggressively bought properties.  Values increased gain at alarming double digit rates. The brakes are on. Higher rates are a rally killer. Let’s hope they don’t go up fast or soon.

I’m a little concerned about the days on market (DOM). It is increasing despite healthy sales. I’m not sure why. I’ve asked colleagues and no one can answer for certainty. I think it may be more to do with builder new home models sitting on market for extended periods artificially inflating DOM. But I’m not certain.  There is a clear seasonal pattern for inventory, with the low point for inventory in late July then peaking January to February.

I’m not a big fan of general market median and average sale price data. Because it’s not meaningful to you as a buyer or seller. What is meaningful is the general market and sub-market (those properties that are most like yours). In YOUR neighborhood. That’s hard work. And we would love to do it for you but you must be one of our clients. We can nail down the nitty gritty details of how your property competes in the general and sub-market by six different categories. Plus all our qualitative analysis. Nevertheless, for all you data junkies I’ll give it to you.

The median sale price YOY YTD in Destin in the Detached Single Unit sector is $360,000 with an average sale price of $502,788. So if you’re a seller, you love the average. A buyer loves the median. Does this really tell you anything? Nope. The average days on market is 153 YOY YTD with a cumulative 221. Supply and demand are in balance but close to oversupply as inventory is increasing. May be a good time to buy. But be selective. The % sold to list is 90.01% meaning that your Det. SU property on average will sell for 10% less than list.

Pray for LOW rates.

Next time: A look at the condominium sector.

BBQ: “Forecasts may tell you a great deal about the forecaster; they tell you nothing about the future.” By Warren Buffet

BLT: Low Rider by War