Oct. 24--Sales of existing homes in Palm Beach County jumped 43 percent in September compared with the same month last year, a sign that the $8,000 tax credit is working and another indicator that the market is clawing its way back, experts said.

Treasure Coast sales showed a 53 percent increase from September 2008.

The data, released Friday by Florida Realtors in conjunction with a report from the National Association of Realtors, showed that 746 homes were sold in Palm Beach County in September and 572 were sold in the Treasure Coast.

Statewide, 14,419 homes were sold, a 34 percent increase from September 2008.

"What we're seeing is an unleashing of pent-up demand," said Walter Molony, a spokesman for the national association. "Consumers have been holding back and there's been a lot of frustration, but now we're seeing a rush of sales activity."

Home sales nationally rose 9.2 percent year-over-year.

While the numbers point to a recovering housing market, some Realtors and mortgage brokers cautioned against declaring a clean bill of health.

Douglas Rill, owner of Century 21 America's Choice Realty in West Palm Beach, said year-over-year comparisons can be misleading.

September 2008 was a "dismal" time, he reminded. People were running scared from the recession -- a retreat that likely lowered home sales -- and were soon hit with a stock market plunge in October.

"Everybody was paralyzed," Rill said. "Therefore, sales figures being up compared to a year ago is not a big surprise to me."

In a month-to-month comparison, Palm Beach County showed a slight drop, from 754 home sales in August to 746 in September. The Treasure Coast showed an increase from 537 to 572.

One looming spoilsport to the budding rebound is an expected increase in foreclosures as adjustable-rate mortgages come due, combining higher monthly payments with deepening unemployment.

A flood of foreclosures would increase inventory while causing prices to dive.

Rill said banks have gotten smarter about releasing a load of foreclosed homes at once. But reaching critical mass could force their hands.

According to LPS Mortgage Monitor, which studies home financing, 10 percent of loans in Florida were in foreclosure in August. Add delinquent loans to that figure and it grows to 21.7 percent.

"We are a far cry from being through the foreclosure problem," said Skip McDonough, a broker with Family Mortgage in Jupiter. "There's a potential for many loans not to perform with the change in interest rates, and that's the tsunami we really worry about."

Florida's median price was $142,000 in September, a 19 percent decrease from 2008. Prices mostly held steady in Palm Beach County and the Treasure Coast when compared with August, but both dropped when compared with September 2008.

Palm Beach County's median fell 17 percent to $242,200. The Treasure Coast saw a 20 percent decrease from September 2008 to $110,800.

"Small dips in the median sales price is still more positive than a dramatic fall," Rill said. "If you add in the fact that interest rates are still great and there could be an extension on the first-time home buyer credit, there hasn't been a better time to buy real estate in the past decade."

Like single-family homes, condominium sales increased in volume but dropped in price.

In Palm Beach County, condo sales were 30 percent higher than in September 2008, but median prices fell 24 percent to $106,700. In the Treasure Coast, condo sales jumped 94 percent but median prices fell 33 percent to $94,100.

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