The last few weeks we’ve been bringing readers up to speed on prices and where they’re headed as well as closings for 2016. This week we decided to focus on listings. We’ve been reporting that listing inventory rises slightly for months and here is the latest graph to illustrate that.
Listing inventory is seasonal. For some reason, more sellers decide to list in season than other times. I don’t know if they perceive there are more buyers here in season or perhaps they come back to SW Florida and decide to list. For whatever reason is does go up in season which makes using the trend line a little complicated.
We did add the trend line which does show a rise in inventory going forward. Year over year numbers are up each month so this is accurate. The real question is going to be, with slowing sales, rising rates, and stagnant home prices, what will happen in 2017?
Listing Inventory Rises Slightly
The amount of inventory in 2017 will most likely affect home prices as much as interest rates do. We’ve seen rising prices up until this year partly because listing inventory has been so low for so many years. As new construction and existing home inventory begins to rise, we’re seeing prices level off. We’re not sure if it’s the chicken or the egg. Does listing inventory rise because prices stagnate or do prices stagnate because inventory is rising?
We think they go hand in hand and affect each other. The SW Florida real estate market is totally balanced right now. You might say it’s a perfectly healthy market. Buyers and sellers are at an equal advantage right now. In the lower price ranges, it’s a seller’s market and in the upper ranges it’s a buyer’s market. The mid-market is balanced.
Buyers, sellers, and agents alike complain when the market is skewed too far in any one direction. It is not often we can say the market is perfectly balanced, but at the end of 2016 I think we can. Our market is like a teeter totter and it is straight right now.
As you know, it doesn’t take much to alter a teeter totter and they don’t stay straight for long. Our market has been slowly moving from a seller’s market to balanced. It could go either way from here. It depends on interest rates, consumer confidence, and the economy.
What Role Will Election Play?
We think the election results will go a long way to resolving some of this. Interest rates will probably rise in 2017. Consumer confidence will be swayed by the economy and confidence in the election results.
Who holds the presidency? Who controls the Senate, and the House? Is the election in dispute? Is the winner under investigation and facing indictment? We don’t know how the election will turn out. Nobody knows how the winner and loser will react post election. We don’t know who will control congress. You’re witnessing is the craziest election we’ve ever seen, and could get crazier after the election.
All we do know is we have uncertainty. Uncertainty may hold back interest rates for a while, but it may also hold back the economy. We don’t control any of this. All we can do is advise our clients and help them make the best real estate decisions for their family.
If you’re thinking of buying or selling, call the SW Florida real estate authority, the Ellis Team, 239-489-4042 or visit our MLS website. While we may not be able to tell you who will win the election, we can advise you on your real estate decisions. Use our website to find out how much your home is worth for Free or search the MLS. Neighborhood market reports are available for neighborhoods you’re interested in.
And be sure to buy some popcorn this weekend because next Tuesday will be must-see TV. Good luck and Happy House Hunting!
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