Interesting trends are developing in our Southwest Florida market snapshot for January 2021. The first thing you will notice from the graph is new pending sales increased 25.6% over January 2020. You might ask how this can be as we have been talking about declining inventory levels for months.
Official numbers are in and indeed active listings are down 60.1% from a year ago. New listings entering the market in January of this year were down 10.4% from last January. The combination of fewer newer listings and increased pending sales have led to the 60.1% reduction in listings.
Pending Inventory is Up
Pending inventory in January increased 51.6% which means the situation will be worse when official February numbers are released. Buyers who have attempted to purchase in this market are keenly aware of how tough it is to score a property.
I do not believe sellers are truly aware how advantageous this market is for them right now. After years of letdown some sellers just quit checking in on their home value. Others are interested but unsure where they would go. I think it is safe to assume there are many homeowners in SW Florida that do not love their current home. They’re just not sure they want to jump through hoops to make a change right now.
The real question is this? When will you be ready? A year from now, two years from now? What if this real estate market looks different than it does today? Interest rates could be a few percentage pints higher which will increase cost of future buying. Not only will it cost you to get a mortgage on your next home, but it will also cost your future buyer as well. That may limit how many buyers can purchase your home in the future.
Right now, we sometimes have 20-30 buyers putting in offers for each home. What happens if we only have 1 buyer for each home in a few years, or worse? In a normal market there are more home sellers than actual sales. This would mean less than 1 buyer for each home.
When is Best Time to Sell?
If you were selling an item at auction do you think it would be more fun to have 20 bidders or just one bidder? If there was just one bidder, there would be just one bid, and if you wanted to sell you would have to take that price or decide not to sell.
Our marketing is creating buyers from all over the country. I have seen some statistics that show more than half of the buyers are from out of state currently. To get top dollar you must advertise out of state. Ellis Team advertising reaches far and wide to bring the greatest number of bidders (offers) for your home.
When homes increase in value like they are today human nature tells us to hold because values will be greater tomorrow than they are today. This may be true, but history also shows us that many wait too long and decide to sell after they have seen the top. They still want the top, but the top has since passed. By then it is too late. The top never tells us when it is coming, so most are surprised when it happens. We are not calling for a top, so do not be alarmed. But do not blame us either if it happens and we did not see it coming.
We Should Talk!
If you are thinking of selling now, or 1-2 years from now, we should probably talk. We can come up with an exit strategy for you, and if we see a shift in the market you will be the first ones we call. The last time the market shifted we told our sellers first and got them out quickly.
You do not want to be caught sitting on an appreciating asset only to find out it started depreciating and the market did not tell you. We will tell you. Simply call 239-310-6500 and we can provide a market checkup for you. This will allow you to be notified if the market shifts. Or you can visit www.SWFLhomevalues.com for a free instant analysis.
Good luck and keep an eye on the market!