Homes overvalued, but market still solid

Homes in South Florida remain overvalued, a new report shows, but that doesn’t mean buyers and sellers should be worrying about a major market correction.

Prices in Palm Beach, Broward, and Miami-Dade counties are 5 to 9 percent higher than what’s considered a sustainable level, according to fourth quarter figures from Fitch Ratings. That’s actually an improvement from a year ago, when homes here were overpriced by 10 to 15 percent, Fitch said.

“Five to 9 percent is not a big number, and I don’t think it implies that the housing market is under significant stress,” said Grant Bailey, managing director for New York-based Fitch. “I think the takeaway is that prices look to be a little high relative to historical averages.”

Bailey said he doesn’t expect prices in South Florida to fall by 5 to 9 percent. In many cases, homes will increase in value at a slower rate while the economics catch up, he said.

Across the tri-county region, prices have risen steadily since 2012.

Fitch, a global statistics ratings organization, analyzes housing markets for investors. It looks at home prices based on such factors as unemployment, rent growth, mortgage rates, incomes, population and household growth.

Fitch tracked prices in the 20 metropolitan areas included in the S&P CoreLogic Case-Shiller index, a respected national home price barometer. Dallas-Fort Worth, Las Vegas, Phoenix and Portland, Ore., were overvalued the most of any metros at 10 to 14 percent in the fourth quarter of 2016.

Areas with sustainable prices were Boston, Charlotte, N.C., Chicago, Denver, Minneapolis, San Diego and Washington, D.C. Cleveland, Detroit and, surprisingly, New York-New Jersey, were considered undervalued. Wellington J.C. Penney honored Like a lot of department store retailers, J.C. Penney Co. is hurting. The Plano, Texas-based chain said last month it will close 138 of its more than 1,000 stores nationwide as it seeks to deal with declining sales in the era of online shopping.

But one local J.C. Penney store is not only surviving, it’s thriving.

The company announced that the J.C. Penney at the Mall at Wellington Green in Wellington received a Founder’s Award, which honors top-performing stores. The award went to General Manager Lisa Escalante and more than 85 store leaders nationwide “for leading teams that excel in the areas of financial performance, customer and client service and business expertise,” the retailer said in a statement.

“Leaders and teams receiving this award have gone above and beyond the call of duty by taking our Warrior values of passion, loyalty, service and courage to an entirely new level,” said Joe McFarland, J.C. Penney’s executive vice president of stores.

No J.C. Penney stores in South Florida were designated for closure. The only Florida casualties are stores in Palatka and Jacksonville and a supply facility in Lakeland. Firm scores five big office deals NAI/Merin Hunter Codman, a West Palm Beach commercial real estate brokerage led by industry veteran Neil Merin, hit elite company last year.

The firm completed five of the 100 largest global office transactions in 2016, according to the Society of Industrial and Office Realtors. Merin Hunter Codman’s haul represented nearly half of the 11 transactions for all of Florida.

The 100 deals are from SIOR members only, though the organization represents many of the world’s top commercial brokers.

Merin or principal Jason Sundook handled the five transactions, all in West Palm Beach:

• A $72 million sale of 447,667 square feet of offices on Centrepark Boulevard;

• The $3 million sale of the 53,500-square-foot building at 5601 Corporate Way;

• A 51,546 square-foot lease renewal for Ocwen Financial Corp. at 1661 Worthington Road;

• The $10.7 million sale of the 45,000-square-foot building at One Harvard Circle;

• A 42,386-square-foot lease for the Health Care District of Palm Beach County at 1515 N. Flagler Drive.