Inventory levels have been growing this Fall, so we decided to do an election day months’ supply of inventory report to see how it changes after the election.
Months’ supply of inventory grew across the board in all price ranges since our last update in September. Election day months’ supply of inventory stands at 5.9 months. Anything over 5.5 months supply is considered a buyer’s market.
The over $1 Million price range came in the highest at 9.74 months supply. Not surprisingly the lowest price range on our chart, below $300k, came in a 3.12 months’ supply. In the last two months, the over $1 Million price range gained the most supply at .78 months, followed by the $300-$400k range at .67months.
The inventory supply has been hit at both ends of the spectrum. Pending sales have been declining while inventory is growing. In other words, more homes are coming on the market than leaving the market.
Turn Around
What’s it going to take to turn this market around? It’s not going to happen overnight as the Ellis Team Current Market Index stands at 5.27. This is the highest number it’s been in a long time and tells us the local real estate market is headed in the wrong direction. Our current market index has been an accurate predictor of future home prices, but it can turn around.
Lower interest rates would help. Interest rates have been marching higher all Fall due to inflation concerns. Inflation and government spending just isn’t what the markets hoped it would be by now.
Consumer Sentiment
Consumers are maxing out credit cards, so many fear the consumer spending fueling the economy may run out of steam. A little bit of good news, whether it’s the economy, interest rates, or reductions in inflation could give consumers some hope. How people feel about their future finances goes a long way towards big spending decisions, like housing.
Election Day
We are writing this article on election day, so we have no idea how the election will turn out. Hopefully we’ll know within a day or so. The sooner everyone knows the outcome, the quicker people can move on with their lives. Even if their candidate didn’t win, at least the outcome is known. Sometimes just mentally knowing an outcome can help people move past whatever is holding themselves back. I feel like people have been holding back from big decisions pending the election.
No matter who wins, we won’t expect things to turn around on a dime. The next president won’t take office until next January, and it takes time for plans to be put into place. It could be a year or more before changes take full effect. The mindset change may take effect immediately, but the policy effects may not be known, especially if we have a divided government.
Tracking
We knew the SW Florida real estate market began changing Feb 15, 2022. We definitively knew June 14th, 2022, that the market would turn when the supply-demand line crossed over. It was at that point price increases were over. The Ellis Team Current Market Index confirmed price increases were over. It was just a matter of time until it showed up in the statistics.
Going forward we will be tracking the supply-demand graph, the month’s supply of inventory graph, and the Ellis Team Current Market Index. These three indicators should tell us if this market will indeed change again.
The market will change again. The question is always, when, which directions, and at what speed? We look forward to reporting on how our local real estate market responds after the election.
Track your home’s value at www.SWFLhomevalues.com Every month our system will send you your home’s new value, along with changes in conditions for your area. You probably watch your stock portfolio on a regular basis, so why not track your home value too? We have the tool for that.
Good luck, and Happy House Selling!
