"Buyers remain highly engaged but increasingly selective, resulting in longer marketing periods and more emphasis on quality, condition and pricing discipline."
That line comes from Sotheby's International Realty brokerage manager John R. Hackett, writing in the firm's second-quarter 2026 report on the Palm Beach market. It reads like standard market-report language until you look at what the numbers underneath it are actually doing. Condo transactions on the island climbed in both the first and second quarters of 2026. Single-family sales climbed harder. And yet the story those two facts seem to tell, that houses are winning and condos are catching up, isn't the story the submarket data supports. The real divide has almost nothing to do with product type and everything to do with a building's paperwork.
A Market That Reads Differently Depending On Which Quarter You Check
In the first quarter of 2026, Palm Beach Island condo and co-op sales volume rose 39% year over year to 110 deals, according to figures from the Corcoran Group and Brown Harris Stevens. But the average condo price fell 14% to $2.4 million over that same window. Underneath that headline, the submarkets split hard: South End condos averaged $1.5 million, up 19% year over year, while in-town condos averaged $3.7 million, down 14%. Single-family homes told a cleaner story in Q1: sales volume up 36%, average price up 18% to $19.6 million, price per square foot at $3,674, and days on market falling to 136.
The second quarter complicated the picture rather than resolving it. Per the Corcoran Group's report and a separate analysis from Frisbie Palm Beach, second-quarter single-family transactions island-wide jumped 44% year over year, closings above $20 million doubled from the prior year, and Frisbie's own count put the median single-family sale price at $13.6 million, up 12% from the same quarter in 2025 and the second-highest Q2 figure on record for the island. Combined single-family dollar volume for the quarter hit nearly $1.1 billion, up 64%. Condo transactions kept pace on the volume side, up 35% year over year, even as available condo inventory fell 20% annually to 204 units, the fourth straight quarter of annual decline. Sotheby's reported combined single-family and condo sales up 38% year over year for the quarter.
Buried in that condo growth number is the detail that actually matters: sales of condominiums and co-ops on the South End surged 138% year over year in the second quarter, while activity in Midtown and the near North End rose a comparatively modest 9%. Two quarters, two different sets of headline numbers, and the same underlying signal both times: overall transaction counts are climbing almost everywhere on the island, but which buildings are attracting that demand is not evenly distributed.
What Brown Harris Stevens Is Actually Describing
Brown Harris Stevens put a name to this pattern in its own second-quarter commentary: "the condominium market is increasingly separating into two categories: newer turnkey product that remains highly desirable, and older buildings that must compete based on value."
That is not a location story wearing a location costume. It is a compliance story. Florida's SB 4-D, passed in the 2022 special session that followed the Surfside collapse, requires condo and co-op buildings three stories or taller to complete milestone structural inspections once they reach 30 years of age, or 25 years if they sit within three miles of the coast, and every ten years after that. Starting January 1, 2026, associations also lost the ability to vote to waive reserve funding for the structural components covered under the state's Structural Integrity Reserve Study requirement. On a barrier island where a meaningful share of the condo stock predates the 1990s, that combination of rules sorts buildings into winners and laggards regardless of which end of the island they sit on.
South End's surge and in-town's comparative softness track loosely with the age and financial condition of the building stock in each area rather than with proximity to the water or the beach itself. A building that has already completed its milestone inspection, funded its reserves, and can show a clean maintenance history is, by definition, the "newer turnkey product" Brown Harris Stevens describes. A building still working through a Phase 2 inspection or facing a reserve shortfall is the one competing on discount.
The State's Own Numbers Show How Uneven The Reporting Is
A statewide report released August 1, 2026 by the Florida Legislature's Office of Program Policy Analysis and Government Accountability found that 2,535 condo and co-op buildings across the state were flagged for deeper Phase 2 structural inspections across 2024 and 2025 combined, after their initial Phase 1 visual review turned up concerns. Fifty-four buildings were declared unsafe or uninhabitable across those two years.
The more important detail for a Palm Beach buyer is what the report says about the quality of its own data. OPPAGA received complete 2025 reporting from only 64% of local enforcement jurisdictions statewide. In Palm Beach County specifically, 44% of building officials never submitted their 2025 figures at all, one of the larger reporting gaps identified anywhere in the state. That means the public record almost certainly understates how many buildings on and around the island are still carrying open structural questions. An average condo price for a submarket tells you what buyers paid. It tells you nothing about which of those buildings still has an unresolved inspection sitting in a filing cabinet at the county.
| Submarket | Q1 2026 average condo price | Year-over-year change |
|---|---|---|
| South End | $1.5 million | +19% |
| In-town | $3.7 million | -14% |
The gap in that table is not a verdict on either neighborhood. It is a symptom of something buyers can and should check building by building.
What This Means Before You Write An Offer
A specialist approach to a Palm Beach condo purchase now looks a lot like the technical due diligence long applied to a working farm or an operational facility: verify the infrastructure before you commit to the price.
- Request the building's most recent milestone inspection report, including the Phase 2 findings if a Phase 1 review triggered one.
- Ask for the current Structural Integrity Reserve Study and confirm it reflects the funding requirements that took effect January 1, 2026, with no waived structural components.
- Review board meeting minutes from the past 12 to 24 months for any discussion of assessments, loans, or delinquencies tied to structural work.
- Get a written statement on any pending or approved special assessment before closing, not a verbal assurance from the listing side.
- Confirm whether the association is using the limited two-year reserve-funding deferral the law allows after a milestone inspection, since that deferral can mask a bill that is coming later rather than one that has been resolved.
None of this shows up in a citywide average. All of it shows up in a building's file.
Where This Leaves Buyers Choosing Between A House And A Unit
The single-family side of the ledger offers a useful counterpoint. February 2026 brought the $76.7 million off-market sale of the historic estate Villa Flora to Anthony Lomangino, and January saw Michael and Elizabeth Chu, of private equity firm L Catterton, sell their oceanfront house for $58.3 million. Sales at that level are not representative of the broader market, but they illustrate the same preference showing up at smaller scale across the island: buyers who can afford either product are choosing land, privacy, and the ability to renovate without board approval.
That preference and the condo compliance divide are not two separate stories. They are the same story told from opposite ends. A fully compliant, well-reserved condo building competes credibly against a house because it offers something close to the predictability a house buyer already has. A building still sorting out its inspection status or facing an assessment gives up the one thing that made it competitive in the first place. The headline numbers on Palm Beach real estate this year are not a contest between houses and condos. They are a referendum on which buildings, of either type, have done the paperwork.
A Few Questions Worth Asking Directly
Does a special assessment automatically mean a building is a bad investment? Not necessarily. An assessment tied to a milestone inspection can simply mean a board is addressing required structural work on the timeline the law now demands. The distinction that matters is whether the assessment is funding a known, scoped repair with a clear number attached, or whether it is the first sign of a larger problem still being investigated.
How do I actually check a specific building's inspection status before making an offer? Ask the listing side for the association's Phase 1 and, if applicable, Phase 2 filings directly, and where those filings were submitted to Palm Beach County, request confirmation of the filing date and status. Given how much of the 2025 reporting cycle went unsubmitted countywide, a direct paper request to the association is more reliable than relying on any public compliance list.
If you are weighing a Palm Beach house against a specific condo building this season, or trying to read what a building's inspection history actually means for its value and its financing, Welles Properties can help you get the real paperwork before you write an offer. Schedule a confidential consultation with David Welles.
