Single family March home prices declined 5.5% from last year. February home prices only declined 1.1%, so we’ll be watching to see if this is a new trend.

The height of the market was April of 2022 for median prices, and May for average prices. Next month we’re going to report the year over year April numbers as well as the current numbers versus the height of the market. Some buyers today feel like waiting because they believe prices should fall more than they have. If they realized prices began falling in 2022 once we got past May and into 2023 and 2024, they might begin to view the market differently.

March Home Prices Declined

March home prices declined sizably this year, but most don’t realize home prices started declining in 2022. Most agents didn’t recognize this because they look at year over year numbers which didn’t kick in until April of 2023. The price declines were happening in real-time starting in 2022. The other thing we have to calculate is seasonality, and this masked what was happening in 2022.

Inventory Levels

Single family home inventory bottomed out in February 15, 2022. We started tracking rising inventory levels from that day forward, and we knew that was the canary in the coal mine. It was just a matter of months after that date that prices began to drop. Ordinarily rising inventory levels wouldn’t cause prices to drop so quickly. It was the fact that it happened in the middle of season and never let up. Typically, listings max out in March, so it is not uncommon to see listings grow in February. Because there are so many sales in season, listings begin to drop again in April. That did not occur in 2022.

Rising Interest Rates

Remember, the Fed began raising interest rates in March of 2022. Inflation was rampant and costs were spiraling out of control. The government quite frankly spent too much money, and it hurt the economy and the housing market. There is a lag between rising rates and slower demand. Looking back, March of 2022 was the beginning of the end. Of course, something else upcoming would affect real estate too.

Insurance and Flooding

Hurricane Ian caused insurance companies to raise rates and look at flooding in a new light. SW Florida had largely been spared prior to 2022. Sure, we had Charley and Irma, but neither brought the flooding like Ian did.

Hurricanes

Hurricane Ian hit Sept 28, 2022. In 2024 SW Florida was affected by Helen and Milton. While not a dead hit like Ian, we did experience some flooding. Some properties flooded three times in 2 years, while others flooded twice. Buyers began to look at flood zones after Ian, and now their radar was activated after two storms in 2024. Many buyers left waterfront areas and moved inland. Total cost of ownership became an issue, and that affects home prices.

Track Your Home Value

If you’d like to track your home value over time, check out our Free Online Home Value Tool.  www.SWFLhomevalues.com Once you begin, it will update and keep track of your home value over time. This is a useful tool to track the market. Or you can continue to read this article, or call Brett or Sande Ellis at 239-310-6500

 Good luck, and Happy Home Selling! Call us if you need help.