Everyone knows that ‘Covid-19’ has affected many aspects of our society, and has been responsible for hundreds of thousands of unfortunate deaths along with millions of cases of sickness. Covid-19 ramifications have materially impacted people’s health, welfare, work-life patterns, the availability of goods and services, and the supply and demand for real estate. On January 31, 2020, the Department of Health and Human Services declared a Public Health Emergency which lasted through May 11, 2023 to address the spread, response and impact of SARS- CoV-2, the virus that causes COVID-19. The fifty state governments responded in different ways to the Emergency. Florida’s response was to undertake all responsible measures to address the crisis, but in general, Florida remained largely ‘open’ with unrestricted travel to, from, and within.
What happened with real estate in Mexico Beach during the Emergency? During March 2020, Bay County closed our public beaches, except for Mexico Beach. At the end of March 2020, the Mexico Beach City Council voted to close our beloved beach for the entire month of April 2020. What impact did this and other closures and restrictions have on property sales in Mexico Beach? Let us examine the sales activity for residential property, and vacant residential lots. Our focus here is on the eleven ‘quarters’ (33 months) between February 1, 2020, and October 31, 2022. Remember that Covid’s impact struck Mexico Beach less than eighteen months after the catastrophic impact of Hurricane Michael, a Category Five storm that made landfall in Mexico Beach. Today, as during the beginning of 2020, Mexico Beach is in a sustained aggressive recovery mode from this cataclysmic weather event.
I. Residential Sales
During our 33-month evaluation period ending with October 2022, Mexico Beach had 362 sales of Residential property totaling $141,289,300. Residential properties include detached and attached single-family homes, condominium units, townhouses, multi-family residences, and mobile homes. During this time, Mexico Beach had approximately 1,450 Residential properties in total; about 25% of homes in Mexico Beach ‘turned-over’ during the Covid Emergency. Examining the data above, you can see an almost unbroken series of quarter-to- quarter increases in the Quarterly Median Residential Sales Price during Covid; only during the quarter ending with April 2022 did the progression of increases dip slightly (-2%). Remarkably, between Halloween 2020 and Halloween 2022, the Quarterly Median Residential Sales Price more than doubled from $272,000 to $586,900 (+116%). Today, there are about 1,500 Residences in Mexico Beach with about 34 for sale with a median price of $675,000; this is more than double the April 2021 Quarterly Median Residential Lot Sales price of $330,000 (+105%)!
II. Residential Lot Sales
During our 33-month evaluation period ending with October 2022, Mexico Beach had 272 sales of Residential Lots totaling $74,306,300. During this time, Mexico Beach had approximately 900 Residential Lot properties in total; about 30% of Residential Lots in Mexico Beach ‘turned-over’ during the Covid Emergency. The Quarterly Median Residential Lot Sales Prices were much more variable than Residences during Covid with several rises and falls quarter to quarter.
From the beginning of 2021 through Halloween 2022, there was almost no change in the Quarterly Median Residential Lot Sales Price (+1%). Nevertheless, hundreds of lots changed hands during this time period. Today, there are still about 800 unbuilt upon Residential Lots in Mexico Beach with about 35 for sale with a median price of $339,000; this is more than double the year ago Quarterly Median Residential Lot Sales price of $167,500 (+102%)!
III. Transaction Volumes
The table to the right notes the quantity of Residential and Residential Lot Sales along with each month’s median sales price during our evaluation period. Interestingly, the absolute low quantity of Residences sold occurred during May 2020 (3) with the low for Residential Lots occurring during March 2020 (2). During the “beginning” of the response (federal, state and individual/family) to Covid, there was confusion, travel restrictions and inconveniences for our typical buyers, along with some fear of the unknown for some in the context of some folks desiring to maintain defensible health postures. These environmental and/or market conditions persisted for about a year, but for the bargain hunting Residence buyers during June and July 2020 when 35 homes sold. Then during February 2021, both the sale of Residences and Residential Lots picked up substantially in a sustained manner through September 2022; the data reveals a discernable elevation in purchase activity during this time period with an average of 12 Residences and 10 Residential Lots sold during each month, with a range of 8 to 20 for Residences and a range of 4 to 22 for Residential Lots. It does appear that Covid may have had an impact on the timing and pricing of certain sales in Mexico Beach, nonetheless, 634 properties sold (362 Residential and 272 Lots) during Covid, and this represents a bustling amount of activity in a community with only 2,644 properties.
You would not think that 24% of the property in a small Gulf-coast community would sell during a Public Health Emergency, but it certainly did!
