Low housing inventory levels in SW Florida are driving prices upward. Buyers struggle to find available homes in their price range and it is happening across the board.
Typically, only a few price ranges get hot when the market moves. Later, more price ranges may catch fire, or the market may run out of steam before all price ranges are affected. What we are witnessing here in Florida is an all-out assault on inventory levels, and it is affecting pricing.
Low Housing Inventory Levels Driving Prices Upward
If a contract falls out for some reason it may be sad for the seller, but in many cases, we put property back on the market and raise the price and it sells again. In the time the home was tied up and off the market it still appreciated.
Some buyers get scared and begin to doubt their decision after they were the winning bidder. Perhaps they question if they paid too much, or they have unrealistic expectations about the home inspection. Others get nervous about HOA costs or insurance costs and find reason to talk themselves out of buying. For whatever reason, they panic and walk. Buyers need a reassuring hand to tell them it is OK to buy and that there are many insurance companies such as bear river insurance that offer great rates.
What these buyers do not realize is when they walk there are dozens of other buyers right there to scoop it up. Buyers from last year are kicking themselves they did not purchase and are amazed at what has happened. Their agent probably told them we had a great market. Inventory levels were going down before the pandemic hit.
Record Low Supply
Back in October 2020 our months supply stood at 2.15 months. We had never seen it that low, and yet we knew it could go lower. Today it stands at 1.77 months. Today everything below $600,000 is below 2 months supply. Back in October it was everything below $300,000. Buyers are being forced to go higher or not get a home at all.
Interest rates are expected to stay low through 2023. There is still room left for more appreciation. Sellers should be cautious though, because holding out for higher prices on the selling end may cost you on the buying end. If what you are selling today is going up in value, what you plan to purchase tomorrow may also be rising.
Florida is sitting in a good spot. Not only do we have sunshine and a great economy, we also have low taxes and freedom. Businesses are not shut down. The vaccine is out and relief to people’s health is on the way. What can never be fixed are all the business that shut down and closed forever. Many businesses up north are shutting down and opening down here before they are bankrupt forever. Florida is gaining residents from northern states, and it is adding to demand with little supply.
We see the Florida real estate market poised for another great run in 2021. More sellers may decide to list and take profits, and that would be a good thing.
If you are a seller, we have some resources for you. We have neighborhood market reports that will show you all the properties active, pending, and sold along with price, $/Sq Ft, and photos. Yes, photos of the sold homes too, so you can see how your home compares.
Instant Price Analysis
You can also check out www.SWFLhomevalues.com It is a fast and Free way to get your home’s value. While it is fairly accurate, we like to validate it in this fast-changing market. Sometimes even the computers cannot keep up with the market. Low housing inventory levels might mean your home is worth more than you think.
If you are looking to buy, www.LeeCountyOnline.com is your best bet. It has all the homes listed, and it is updated in real-time. That is important in a fast-moving market like this. You want to beat out other buyers to hot new listings, or listings that suddenly come back on the market.
Always call Sande or Brett Ellis 239-489-4042 Ext 4 for selling advice. We’d love to help you. We have a team of buyer specialists if you are looking to buy who can help guide you.
Good luck and Happy Holidays!
See last week’s article “Confusing Statements Lenders Make to Buyers and Agents“