Single family home inventory in Lee County is rising. This past week we crossed 4,000 single family homes, and number we haven’t seen since May of 2020.
We expect there to be several expired listings at the end of May which will bring current single family home inventory down. This has happened each month in 2023. Inevitably inventory rose as more listings came on the market than expired. Perhaps many of the expired listings relisted as well. Each day we are watching new listings exceed pending sales, so we know inventory should keep rising.
Is 2020 the New 2023?
In past articles we’ve mentioned that closed home sales are mirroring 2020. If there is a correlation between the number of closed home sales and the 2020 single family home inventory counts, it could be a clue as to where inventory will head. Back in 2020 we had about 5,500 homes on the market, which was less than the 2019 highs of 7,195. The market was getting good in 2020 as was the economy, just before Covid hit.
Inventory levels took a hit as few wanted to sell during Covid, and builders had a hard time keeping up with demand. Interest rates were low. Now that Covid is in the rear-view mirror mostly, and so are low interest rates, we are returning to normal levels of inventory.
Why is SW Florida Different?
Nationwide there is a shortage of homes on the market because many people with low rates on their home do not want to sell and buy another at a higher rate. Why is the SW Florida market gaining inventory when the rest of the country seems to be losing inventory?
Perhaps it’s the hurricane. Some people are done with storms and rising insurance costs. It could be that less workers are moving to Florida as employers call them back to work. This doesn’t make sense because people are still moving to Florida in droves. The last report I saw was that 958 people move to Florida every day. In fact, Florida is the #1 net migration state. More people are moving to Florida than leaving versus any other state in America.
I noticed SW Florida International Airport saw a 23% drop in traffic in March. This makes sense because our beaches were barely open, and we lost so much tourism. There simply weren’t the homes, condos, and hotels to rent in many places like Sanibel Island and Fort Myers Beach. Many Airbnb’s have been damaged as well.
Single Family Home Inventory Rising
This doesn’t exactly explain why inventory is growing in SW Florida while it appears to be dwindling in other areas. SW Florida single family home inventory has almost quadrupled since February 15, 2022. Back then it was 1,071 homes on the market versus almost 4,000 now.
Over the summer we are going to track listing inventory against closed sales to see if 2020 numbers are the standard our market should be judged by, or if this is a blip. Markets rarely stay the same for long, and this could just be a coincidence until our market decides what it wants to do.
2020 wasn’t a bad year before Covid hit. Prices were rising slightly, and inventory was coming down from 2019 levels.
2nd Half of 2023
Some say the Fed will raise rates again in June, while others are convinced they are done. Many predict mortgage rates may come down by the end of the year. We believe a lot will be decided in the next two months. By then we may have a better handle on how the second half of 2023 will go for the economy and the housing market.
If you have a home to sell, Always Call the Ellis Team at Keller Williams Realty 239-310-6500. We have the best stats and can advise you as to how the market is doing long before others figure it out.
Good luck and Happy Selling!