The past several months we’ve been reporting rising home prices in SW Florida. Everyone seems to agree the Southwest Florida housing market is in recovery. For awhile we’ve had tight inventory with escalating prices. Periodically we like to go inside the numbers and breakdown various facets of the market. June 2013 SW Florida Real Estate Numbers.
Today we’re looking at traditional sales versus distressed sales. As you can see from the attached chart foreclosure sales are down 35.1% from last year and short sales are down 43.9%. Traditional sales are helping to pick up the slack but the limited inventory is holding sales down. In other words, if we had more inventory to sell we’d surely sell it.
Traditional median sales price increases to $210,000 which is allowing many more sellers who were previously underwater the ability to sell their home without being a short sale. However, there are still plenty of underwater homeowners who’d like to sell but are trapped. They’ve held out this long and don’t want to jeopardize their credit by selling short, so they wait.
People talk about shadow inventory from the banks as if they’re holding back inventory waiting for prices to rise. We don’t believe banks are holding back. We don’t believe there is a glut coming to the market. There will still be more foreclosures in the future as economic growth is anemic and underwater owners are still susceptible to changes in their personal employment situations, however we believe it will be a manageable number.
The real shadow inventory is the trapped homeowners waiting for the market to come back to a point where they can afford to sell. In a normal market sellers buy and sell locally as their wants and housing needs change. This hasn’t been happening here locally until recently.
In the past few months we’ve had several sellers placing their home on the market only to buy a different home that better serves their needs locally. This trend will continue as prices rise, and especially in light of the fact interest rates are still relatively low, currently in the mid 4% range.
As prices rise we could see a little more inventory which will increase sales volume. Builders are building again which is helping to pickup the slack due to the shortage in inventory.
We are seeing more homes come on the market in the $200,000-$300,000 range which should boost home sales in that range on inventory levels alone. We’ll begin to see move-up buyers, lateral buyers, and transitional buyers who may not want as much yard or as much home due to their age.
One thing is constant is that the market is always changing, and we’re witnessing some pretty phenomenal positive changes in our market right now. Because our market was healing for so long some started to believe we’d never see this day. It’s easy to get bogged down on what has been and lose focus on where the market is today and where it’s going. Real estate is a lot like a sports team. “What have you done for me lately?” The glory years of yesteryear don’t matter. What your home used to be worth on paper is in the past. The only thing that matters is today, the here and now. A property’s value is not what someone paid for it a long time ago but rather what it’s actually worth today independent of its former value or cost. Cost does not always equal value.
We’ll keep our eyes focused on the numbers and keep reporting them to you. If you’d like to search the MLS you can at www.Topagent.com If you’re a seller and you’re considering selling, you might be surprised to learn what your home is really worth today. To find out, give us a call at 239-489-4042
Good luck and Happy House Hunting/Selling!!!!
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