Palm Beach County Homes Under $5 Million Are Stuck, Here’s What’s Really Happening

Written by:

Alejandra Rodriguez

Date:

06 Mar 2026

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If you bought a home in Palm Beach County during the pandemic with a 3% mortgage, you likely paid far less than similar homes cost today. Now, as families outgrow their houses or seek to move closer to the water, they face a stark reality: prices for the next step up have doubled, and mortgage rates have, too. For thousands of households in northern Palm Beach County, this isn’t theoretical. It’s the reason the market for homes between $2.5 million and $5 million has stalled.

“We’re stuck in this purgatory where the seller believes their property is worth $5 million, the buyer believes it’s worth $3.5 million,” says Brian Fairweather, a real estate advisor with ONE Sotheby’s International Realty in Jupiter. “Nobody wants to bend first.”

The result is a standoff. Homes in this price range are sitting on the market longer, sellers are frustrated by the lack of offers, and buyers are either making lowball bids or walking away. At the same time, ultra-luxury properties, such as $60 million oceanfront estates, are still selling, and aggressively priced homes below market value can still spark bidding wars. The tension is concentrated in the middle.

Why the Range Is Stalled

This is not a sign of a collapsing market. Northern Palm Beach County remains stronger than it was before the pandemic. However, the buying frenzy from 2020 to 2023 created unrealistic expectations on both sides. Sellers remember homes selling in days, often for above-asking prices. Buyers recall a time when cheap financing and low inventory made every property feel urgent.

Now, both groups face a different landscape. Mortgage rates have doubled since the pandemic. A buyer who could afford a $3 million home at 3% interest now faces much higher monthly payments on a $5 million home at 6% or more. Even affluent families feel the impact.

Unlike ultra-high-net-worth buyers, who often pay cash or use asset-backed loans and are less concerned about rates, buyers in the $2.5 million to $5 million range are sensitive to financing costs. “Interest rates still play a factor for this group,” Fairweather says. “They’re not as insulated as the ultra-luxury buyer.”

Inventory has also shifted. During the pandemic, buyers took what they could get. Now, more options are available, but sellers have been slow to adjust their prices to match the slower pace of sales. Homes that remain on the market for weeks or months are usually overpriced relative to current demand, not because buyers have disappeared.

What’s Actually Selling

Homes priced accurately for today’s market still sell quickly. Fairweather has seen listings just below recent comparable sales attract multiple offers and sometimes close above the asking price. The key is realistic pricing, small discounts work, but overpricing leads to stagnation.

Several factors cause homes to linger. Outdated interiors, especially kitchens and bathrooms, immediately deter buyers. Homes on busy streets struggle to sell, even with price cuts. Any property that appears overpriced for its condition will sit, regardless of neighborhood appeal. “If a property’s priced right, it sells quickly,” Fairweather says. “The inventory that’s staying on the market longer is usually due to price.”

Buyers in this price range are more selective than they were two years ago. They take their time, tour multiple homes, negotiate aggressively, and often test sellers with low offers. Sellers who expect quick sales and bidding wars like those during the pandemic are often disappointed by the slower pace and tougher negotiations.

What You Should Do

For buyers in the $2.5 million to $5 million range, patience is a major advantage. There is little reason to pay the asking price for a home that has been on the market for weeks. Base your offer on recent sales of comparable homes rather than the seller’s expectations. Properties on the market for more than 30 days are often open to negotiation. Consider asking for seller concessions, such as closing cost credits, rate buydowns, or repair allowances. Sellers eager to move are more willing to negotiate than they were a year ago.

For sellers, pricing aggressively from the start is critical. Overpricing leads to a longer time on the market, which makes buyers suspicious. Work with your agent to analyze sales from the past 60 days, not just list prices. If your home isn’t fully updated, offer upgrade credits. Buyers in this range expect modern kitchens and bathrooms. “Everyone wants quartz counters and new appliances,” Fairweather says. If your home feels dated, a credit can help buyers plan their own improvements after closing.

Presentation also matters. Professionally staged homes with high-quality photography attract more attention and showings, increasing the chance of a sale.

The Bottom Line

The Palm Beach County market between $2.5 million and $5 million is not broken, but it is undergoing a reset. Sellers who price realistically and offer flexibility are closing deals. Buyers who are patient and negotiate are finding opportunities. Those expecting the rapid-fire, over-asking sales of the pandemic years are likely to be disappointed. “The market is still healthy,” Fairweather says. “It’s just not moving at the rate it did from 2020 to 2023.” For buyers and sellers willing to adjust their expectations to current conditions, opportunities remain.

About the Expert: Brian Fairweather is a Global Real Estate Advisor with ONE Sotheby’s International Realty, specializing in residential properties in northern Palm Beach County, including Jupiter. He focuses on golf course communities and waterfront homes.

This article is based on information provided by the expert source cited above. It is intended for general informational purposes only and does not constitute legal, financial, or real estate advice. Readers should conduct their own research and consult qualified professionals before making any real estate or financial decisions.