A few months ago we informed readers about a possible shift in the local SW Florida real estate market. Agents were calling complaining that their buyers didn’t have a sense of urgency and just weren’t responding to seller’s counter offers. Today agents react to shift in local real estate market.
Times have been tough for agents lately. Season is the time agents can make it up if the rest of their year has been flat, but this year things were different. Our sellers did fine as we saw the changes coming and recommended strategies to get our client’s homes sold.
Agents who read this article or study the market the way we do also made changes, but many agents didn’t and are hurting today. Some are leaving the business, while many more are getting into the business.
You might question if some are getting out why would others be getting in? Truthfully, it’s happened before. A whole new crop of newbie agents don’t know what’s happening in the market, and that’s a good thing. It’s not good that they won’t know the market, but it’s good that they’re not listening to the doubters as you’d never make it in this business if you listened to negativity.
And besides, there’s always room for good people no matter what the market is doing. This business isn’t easy. Buyers and sellers need good quality agents to guide them, and these shifts in the market can help weed out some of those agents. Agents who didn’t make it on their own will flock to teams, which is maybe where they should have been to begin with. Teams spend lots of money generating leads. Capturing today’s buyers and sellers isn’t free and newer agents just don’t have those resources to spend and stay in the business.
Agents React to Shift in Local Real Estate Market
It’s always been said that when prices rise sales naturally fall, and you typically make up for the slower sales with increased volume. With fewer sales, this means some agents won’t be getting a piece of the pie, but the agents that do will have larger pieces. But what if that wasn’t true either?
I pulled up unofficial statistics for March and noticed home sales were down 18.74% from last year. I looked at total dollar volume and it’s down 25.65%, even more than the drop in sales. This tells me prices have dropped, or sellers have dropped their prices. Total dollar volume has dropped through a combination of fewer sales and lower prices.
I expect average prices to drop in March and quite possibly median prices too when numbers are released later this month. I did not study median prices for purposes of this article.
The news is not all bad. This doesn’t mean prices have fallen 25%. It means that if a seller was listed too high their home didn’t sell. Perhaps it was 5-10% too high. In any event, the market rejected it. If enough sellers are 5-10% too high, number of sales fall and so can sales volume. If all the sellers out there reduced their price to where the market really is, number of sales might be the same or better. Sales volume might be slightly lower because prices are 5-10% below last year, but you wouldn’t see declines of 25%
Not all real estate is lower. Some prices are appreciating while some are taking a break from recent peaks. It pays to hire an agent who has experience and can guide you through these market shifts.
And if you’re an agent who is struggling but feel you have what it takes to succeed in real estate, perhaps consider joining a team. Yes, your splits may be different, but you’ll actually have business and profit because you have leads and guidance versus wallowing with few leads and little coaching.
If you’re a buyer or seller, you can search the market and do market research at our MLS Search Site. You can always call us at 239-489-4042 and one of our agents will be happy to guide you through the market. And if you’re a good agent that needs some help, call us too.