This edition of your market update is a year-end recap of 2022’s activity. While volume stayed flat, Palms Condominiums had the benefit of increased pricing last year. Not necessarily a surprise, given buyer demand hadn’t dropped dramatically. Buyers continued to pay top dollar despite the steady stream of news they heard about the shifting market. This tolerance for higher prices is likely to end, with higher interest rates taking an even bigger piece of their monthly payment pie, reducing the price they can afford to pay. From what I’m seeing, the peak is pricing may have passed for the majority of properties on the island. Stay tuned.
What hasn’t yet changed dramatically is the overall level of inventory in Galveston. I am certainly seeing more properties come on the market, especially now that the holidays are behind us. While this doesn’t apply to Palms Condominiums, it will be interesting to see if inventory at vacation-rental-friendly properties will increase leading up to Spring Break (the traditional start of the rental season), or if the likely increase in travel in 2023 will keep rental owners from selling in anticipation of a possible banner year for vacation rentals. Interest rates are a consideration for sellers as well, if they are planning to finance their new purchase. It can be difficult to justify trading a lower rate loan for a higher one, AND pay more for the property, especially for a non-essential purchase.