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Rock star Jon Bon Jovi and billionaire investment guru Charles R. Schwab are a few of the uber-wealthy people who’ve bought mansions in the town of Palm Beach this year, a trend that’s only accelerated amid the Covid-19 pandemic.
Home sales slowed dramatically across Florida in the initial months of the health crisis. Certain luxury markets, such as Miami Beach, have taken longer to recover. Yet, Palm Beach has experienced a flurry of activity, and sale prices are reaching new heights.
One of the nation’s wealthiest ZIP codes has become even more wealthy.
There were 41 single-family home sales in the town of Palm Beach in the second quarter, a 21% increase from the same quarter a year ago, according to Corcoran Group. The median sale price rose 36%, to $7 million.
“From late April through now, the market has been flying,” said Dana Koch, a broker with Corcoran Group in Palm Beach. “People are coming from all over the country [because] they realized, while sitting in quarantine, that they wanted more space.”
Palm Beach is known for being a center for “old money,” with seniors who inherited their wealth and spend a lot of time at charity galas. But Koch said many of the new buyers are extremely successful working families that include kids. Instead of calling Palm Beach their second home, they are moving there full time.
Kelly Smallridge, president and CEO of the Business Development Board of Palm Beach County, said local private school enrollment is “through the roof” because of all the new homebuyers in Palm Beach.
The trend will lead to small office openings by northeastern firms whose company heads no longer want to risk the health of their families or employees by living in such a dense market, she said.
“This has not led to a large number of office openings yet, but certainly a decent amount of new inquiries," Smallridge said. "They are looking at buildings, land and private enterprises to purchase. They also are asking us for accountant and legal service referrals in order to understand domiciling in Florida.”
Whitney McGurk, a senior realtor at Brown Harris Stevens who grew up in Palm Beach, said business is very seasonal, but full-time residents are remaining here longer. Once the pandemic eases and more people go out, local shops and restaurants will benefit from the larger year-round population, he added.
“It feels like we are in midseason, although we are in midsummer,” McGurk said.
Koch said several high-end restaurants from the Northeast aim to open Palm Beach locations to follow their clientele.
Many people in New York City are tired of being cooped up in apartments and want a larger home, along with a pool and beach access, McGurk said.
While many of the people moving down are younger, there are still seniors in the Northeast who had been thinking about Palm Beach for a few years and the pandemic made them pull the trigger, he added.
The activity from the Northeast started with a flurry of rentals in mid-March, said Suzanne Frisbie, a broker associate with Premier Estate Properties. Once kids were being homeschooled and people were working remotely, wealthy people could choose to live anywhere – and many of them favored Palm Beach, she said.
The scarcity of available properties in Palm Beach is driving up home values. The island has about 2,500 homes, with 7% on the ocean and 11% on the Intracoastal Waterway, Koch said. Some of the interior lots are especially valuable because they are larger and have access to a beach cabana at the end of the street. Even non-waterfront homes in Palm Beach routinely sell for over $10 million.