Palm Beach Real Estate: Nine pending sales in January

for single-family homes, could be a good sign

Last January, the harbinger of a slow season, only one home sold in Palm Beach. It was priced for $2 million. This January, two single-family homes sold– for $3 million and $8 million – and nine homes went under contract, generating cautious optimism among local realtors and analysts, along with some misgivings.

“Some weakness still lies ahead for high-end properties, like those in Palm Beach,” said Brad Hunter, director of consulting for national housing data consulting firm, Metrostudy, South Florida Division. “That’s simply because of the poor performance for the economy in general.

“However, the rally in the stock market may provide a boost to the Palm Beach market. There are a lot of mixed indicators — some positive, some negative. But it’s encouraging that there’s a pipeline of pending sales.”

Overall, according to the National Association of Realtors and the Florida Association of Realtors, from December 2008 compared to December 2009, the number of home sales increased nationally (15 percent), for Florida (15.5 percent) and for Palm Beach County (33 percent).

For Palm Beach, on the other hand, the number of single-family home sales went down, from 104 in 2008 to 81 in 2009, according to Leslie Roberts Evans, a Palm Beach attorney who tracks and reports sales of single-family Palm Beach homes and condominiums in his Evans Report Analysis.

“The gains reported [by the Realtor associations] are due partially to the First-Time Homebuyer Credit and partially to the fact that home prices are down drastically because of foreclosures and short sales,” Evans said. “Neither of those applies to home sales in Palm Beach.

“November and December were slow in Palm Beach,” he added. “In January, there was a marked increase in activity, which will reflect an improved first quarter versus last year’s first quarter.” First quarter 2009, he reported, six homes sold in the $2 million to $6 million range.

Scott M. Gordon, an agent with Fite Shavell & Associates, represented the buyer in the first sale in January, an $8 million deal. “This January, compared to last January, it’s like night and day,” he said. “I’m showing every day. On my new listing, 14 people came through in a two-hour period.”

Gordon’s buyer, Campana PB Trust, a Southport, Conn., corporation, purchased 120 Canterbury Lane, owned by Bruce A., James M. and Robert S. Schwartz, represented by Ned Monell of Sotheby’s International Realty. The property, which closed on January 13, was listed for $9.9 million.

“A lot of people have been sitting on the sidelines,” Gordon said. “Now, they don’t think prices are going to go drastically down from here, and they see an upside in the values of properties, which are selling for a lot less even as late as September, 2008. There are a lot of good buys out there.”

January’s second sale, 146 Australian Avenue, owned and listed by Michael J. Flynn, sold on January 28 for $3 million. It was listed for $3.395 million. Michael Montgomery, an agent with Jeffrey A. Cloninger & Associates, Inc., represented the buyers, Patrick and Amber Turner.

“December and January are always slow times,” Jeffrey Cloninger said. “To have that number of sales pending is a great sign.

“We’ll have to see what happens this season, but my gut feeling is that we have hit bottom in Palm Beach. Prices have adjusted and 146 Australian is a good example of that – It was priced right and sold within 12 percent of the asking price. Buyers are pleasantly surprised at the values that are out there.”

Hunter notes that although buyers are not as adamant as they have been about getting a bargain, they are still looking for good value. “I think good value is going to be the watchword for Palm Beach for 2010.”

Jack McCabe, of McCabe Research & Consulting, LLC., is not enthusiastic. “Nine pending — one month does not a trend make,” he said.

He sees that big bonuses on Wall Street will translate to some real estate sales in Palm Beach and notes that some sellers are getting realistic. “Of course, Palm Beach has a mystique and it will always have that,” he adds.

“But this year, I’m predicting that ultra-luxury single-family homes are going to take the largest declines. We will see foreclosures on homes that are more than $750,000. They are over-leveraged and the owners have taken huge financial hits. When arms adjust and monthly payments go from $8,000 to $14,000 a month, they can’t do it and we’ll see price drops of 10 to 15 percent. What was $10 million this year will be $8 million next year.

“There have been a few foreclosures in Palm Beach, and people have been surprised. I think they will be more shocked to see how highly leveraged the property owners are.”

Hogarcito, Palm Beach – Historic Homes for Sale

Hogarcito, “Little Hearth” at 17 Golfview Road, Palm Beach, was designed by architect Marion Sims Wyeth in 1921 for cereal heiress and Palm Beach socialite Marjorie Merriweather Post while she was married to financier Edward F. Hutton.

The 10,000 plus-total-square-foot Spanish Mediterranean house with five bedrooms, six bathrooms and a bell tower encompasses two buildings: the main house and a second house, which are connected by an arcade.

Here’s a little of Hogarcito’s history according to historian Donald Curl. “It was the first house on Golfview,” Curl says. “Many of the other houses were built literally because Marjorie Merriweather Post wanted to populate the street with what she called, ‘young marrieds,’ which was how she saw herself. She would have been in her 30s at that time and was married to her second husband.

“Jesse Woolworth Donahue’s sister was one of the young marrieds, Mrs. McCann. Her husband was an attorney and they bought a little Wyeth house that he had done for Mrs. Post. Golfview was like a housing development, particularly on the north side, where Wyeth did a number of little houses. They were purchased very quickly and he added onto them over the years.”

Although impressive, Hogarcito was fairly simple and was never an enormous house, Curl says. “That is part of the reason Mrs. Post built Mar a Lago. She always claimed Hogarcito was not big enough. She had all these daughters coming home with their friends, and she needed something larger. She decided she wanted a knock-them-dead house.”

And hence, she built Mar a Lago.

However, Hogarcito’s “courtyard is marvelous, and the new pool adds to the whole thing,” Curl says. “The house has all these exterior galleries and the tower has a bell in it. Wyeth was very proud of Hogarcito. He thought it had a good design.”

Entry is by way of an impressive foyer with a Cuban tile and stone floor. Straight on to the south is the living room with herringbone wood floors. To one side, doors open to the terrace, and to the other, doors offer views of the garden. Through the living room is an enclosed loggia, where the walls are covered in trellis. From French doors there, a covered walkway leads to the separate two-floor master suite.

The loggia looks out to the terrace with its 17th century fountain, one of four  fountains on the property.

To the west of the foyer is a salon with hardwood floors and French doors that lead to the courtyard. Farther west is the dining room, and then the kitchen. In this portion of the house are also the garage and staff quarters.

To the east of the foyer and up a few steps is the library with Cuban tile floors, pecky cypress ceiling and a fireplace.

On the second floor are three guest bedrooms ensuite and a master bedroom suite.

And then there’s the bell tower. When present owner Bruce Bent moved into the house 25 years ago, it was boarded up. “I opened it up, and to my surprise, there were bedrooms and a bathroom up there. I converted the space into a den,” he says.

“There are two terraces on the roof. They are very private, and it’s a neat spot.”