We are studying preliminary sales numbers for August from MLS. The numbers suggest a soft landing for sales prices in SW Florida.
Golf courses in Florida are mostly flat because much of Florida’s terrain is flat. Up North, many golf courses have elevated greens and greens that are downhill. This past year our local real estate market felt like buyers were having to hit elevated shots to an elevated green to get their offer accepted.
Golfers know that for every elevated green there may be future shots to a downhill green. Buyers have the same assumptions as golfers. They believe what goes up must come down.
Soft Landing for Sales Prices
The reality is, the elevated green is the new level playing field. While we will still have multiple offers on properties due to low inventory, we don’t believe the overall market is going to climb like it did this past year. In fact, we are already seeing in the numbers a leveling off. This is a trend that has been happening for about 3 months, but because it doesn’t feel like a flattening market, sellers and agents have not recognized it.
If you speak with real estate agents lately, they will tell you the market has cooled in the last few weeks. The market has not cooled, it has leveled. When sellers bring a property to market correctly priced, there are many buyers. When a property enters the market overpriced, we don’t have 50 buyers jumping at opportunity to bid on it.
Diminishing Price Increases
We saw 36% price increases year over year, but as we enter future months those will begin to diminish as prices have stopped rising. We will still see year over year gains until one of two things happen. As prices are stagnant, we will either run out of months and stats will show a leveling or the market will move once again.
If the market does not make a move, you will see prices staying the same. We are already seeing this in the month over month prices. Unofficial numbers for August show an average sales price of $466,281 and a median sales price of $365,000. July 2021 official numbers showed an average sales price of $469,072 and a median sales price of $360,000. In essence, the average price went down about $3,000 and median price went up about $5,000. Keep in mind, these are still unofficial numbers. There could be more sales reported from MLS participants from other boards throughout the state.
These numbers are believable though because we have been seeing this trend. Prices since April and May have leveled off. Some is seasonal, and some is buyers have maxed out.
Sellers Should Sell Now
Listing inventory has leveled. It’s not going up or down. We are telling sellers now may be the time to sell. There is not much advantage in waiting now. We have low inventory. Prices have stalled. Interest rates are expected to climb when the Fed ends tapering. This will put pressure on buyers and further cap future gains. It just feels like this market is now fully valued unless something changes.
For years we said Florida was undervalued. Today, it might be fairly valued. We are not expecting prices to vary wildly. We believe we are in a trading range.
Buyers should take advantage before rates rise and sellers should take advantage of the new normal in pricing. Both sides can do well if they do not get greedy. Waiting for a better opportunity tomorrow just doesn’t sound like the best plan.
If you’d like to talk about the market, call Sande or Brett Ellis 239-310-6500 or visit www.SWFLHomevalues.com to track your home’s value monthly.
Always call the Ellis Team at Keller Williams Realty. We are here to help!