July 2023 Market Report – June 2023 Data
Results are out from the latest Florida Realtors analysis bringing us some good news for the data of the month of June 2023.
First, it appears that the impact of the interest rate hikes has finally started to settle, and people are starting to get used to the idea that rates are higher for the foreseeable future. Now that we have accepted this new world, people are starting to move forward with their real estate purchases but are adjusting how much they can now buy, potentially putting down more money to keep the loan-to value ratio low and other strategies as we discussed in the past. “Date the rate, Marry the house” as what goes up will eventually come back down and refinancing down the road is most likely a part of many homeowners’ strategy.
Second, the gap between this year’s closed sales and last year’s closed sales is starting to shrink. If you recall in my market report from the early part of 2023 it showed a very large differential of closed sales from same time last year. In fact, if interest rates start to stabilize after this latest increase, it is possible we may surpass 2022 closed sale results for the second half of the year in South Florida.
Third, pre-pandemic times brought a slower real estate market in the summer months, and we are once again experiencing this seasonality. Summer has been quiet around town but It is once again wonderful to see people taking summer vacations and traveling around the world.
With summer coming to an end, our activity has increased quite substantially in the past few weeks. Public schools reopen next week, and private schools are getting ready for opening just a few weeks away. Life is coming back to South Florida, and I fully expect the waits to rise in all our local restaurants once again – but again, this is a great problem to have.
We are anticipating the influx of people back to our area will bring a change to the current inventory situation we have been experiencing.
Inventory in the market of $600,000 and below is low but stable as compared to the past few months.It is still a strong seller’s market with an average of 2.3 months of inventory.
Inventory in the market $600,000 to $999,000 is 3.25 months which still boosts a strong seller’s market; however, inventory has dipped from the past few months.
Our luxury market shows some interesting trends. First, inventory is down in this category as well but still in a balanced market with neither the seller nor the buyer having an advantage. Listings are taking longer to sell, and a large percentage of sales happened well below the listed price. Both the median and average sales prices have dropped year over year.
What does all this mean for you as a Buyer or a Seller?
First, Sellers, while inventory is down, one may think that this gives the sellers an advantage. I would say yes, it does, but only if you price your home right. The buyer’s sense of urgency and desperation is no longer what we experienced during the pandemic. If your home is priced too high, in this market, it does not typically result in a lower offer, the listing will simply sit. Once a reduction occurs to a price point that the market deems appropriate, then the showings and offers come. Ensure you put your best foot forward regarding staging, pricing and who you partner with to sell your home. Marketing, advertising, and good old-fashioned sales 101 will make a difference.
Buyer’s, be patient. There is not a lot of inventory in most price points, so this is a great opportunity to learn about communities and determine where you want to be. This is a market in which we, as Realtors, end up spending a lot of time out in the communities with our clients educating them on the various areas so that when inventory does pick up and there are more choices, our buyers have already narrowed down to the areas they want to live. This does not mean you cannot get into a home today, simply stating that when they are priced right, they are still going quickly and it most likely will take more time to get you into the right home at the right price.
Selling and buying simultaneously is a challenge in a lower inventory market. Our suggestion to our Sellers in this situation is to consider selling your home, pocketing the profits and then being free to make an offer when the right one comes along. Of course, there are other strategies in this scenario and ones that we evaluate on a case-by-case basis with our clients.
Our market is trending in the right direction in most categories, we simply need more inventory and expect to see an increase in this area over the next few months.
Whether you are selling or buying or both, we would love the opportunity to be your real estate partner.
Amy and Noreen Team of Lang Realty