Single family home and condo listing inventory resumes rising trend for third consecutive week. Single family home inventory rose for the third consecutive week while condo inventory rose four consecutive weeks.
Pending sales have moderated a bit too, leveling out the past two weeks. One of the things we look at is the difference between listing inventory and total pendings. That difference just reached the highest level all year. Basically this means more properties are coming to the market then jumping off.
This is a trend we saw prior to Hurricane Ian. When Hurricane Ian hit, there was a temporary lull which caused that differential to drop. Since November 9th that differential has begun to resume that upward trend.
Hurricane Ian caused many in SW Florida to hit the Forget Button. They forgot what was happening in the market prior to Ian. Our lives were turned so upside down that economics and reality didn’t matter, if only temporarily. We were in survival mode and everyone did what they had to do to find housing, work, food, water, etc. Now things are settling back down for most and returning to normal, even if it is a new normal.
I don’t like the new normal, but nature didn’t ask my opinion. I don’t like that we don’t have a beach to go to, or the fact so many cannot live in their home after the storm. So many people don’t have their same job because the business isn’t open or doesn’t exist. Nobody asked for the new normal, and yet to survive we must deal with it.
Rising interest rates caused home buying activity to slow nationwide, and here locally. One of the reasons prices were able to rise like they did the past several years was because of low borrowing costs, but those days are over. Home prices haven’t statistically fallen much, but it has affected home closings which are down significantly.
Inventory Levels Affect Future Pricing
One of the reasons we track inventory levels is because eventually that could affect home prices. Right now many home sellers can be choosy. Many don’t have to sell, so they don’t. Eventually more and more homeowners must sell for various reasons. If supply continues to build, it could affect home prices going forward.
The Fed is still tightening short term interest rates. Economic data is due out this week after this article is written which could affect long term interest rates. Recently 30-year mortgage rates have fallen back to about 6.58%, down from over 7%. This has helped some real estate deals. We will keep our eye on rates going forward. Any help we can get on interest rates can directly impact the market.
30 year mortgage rates are pegged on the 10 Year treasury note which declined in recent weeks because many thought the Fed would be less aggressive going forward. We believe the Fed will talk tough this week, and the markets will react. The tougher the Fed talks, the quicker we can get to peak rates and eventually lower rates. The Fed has been slow and behind the curve. They must raise unemployment and slow housing to curb inflation. Both are moving, just not quickly enough to move the needle.
Home prices have remained amazingly steady locally. They don’t seem to be rising or falling, although we are seeing price reductions. This is a sign that sellers do not rule the roost anymore and it is heading towards a balanced market. Going forward we will be watching interest rates, inventory levels, and of course our Current Market Index which we share with Ellis Team sellers.
Home to Sell
If you have a home to sell, Always Call the Ellis Team at Keller Williams Realty 239-310-6500 We’d love to sit down with you and discuss your options. We have more inside information we can share. Good luck, and Happy Selling!