The Palm Beach residential real estate market has performed positively through the first three quarters of 2018, buoyed in part by an impressive 30% increase in +$20MM sales compared to this same time last year. From a macro level, the unemployment rate has dropped to 3.7%, its lowest level since 1969 (WSJ), and household wealth has surged by 83% to an all-time high of $100.8 trillion (Forbes). Wage growth is on track to top 3% for the year and GDP growth is expected to be 3.1%, up from the 2.8% projection the Federal Reserve made back in June (CNBC). In light of these economic tailwinds, the Federal Reserve has continued its process of normalizing rates with its third hike this year, although rates still remain below their neutral level (Northern Trust U.S. Economic Outlook). In spite of interest rate fears, stock market volatility, looming tariffs, and the divisive political climate, the aforementioned economic momentum continues to advance the Palm Beach real estate market. With its high barriers to entry and constrained supply pool, the Palm Beach market remains well positioned as our economic cycle matures.
