Recent statistics show local home sales highest on record. Keller Williams Realty International predicts 2021 will be the 5th best year in real estate sales nationally just behind 2020 levels.
Locally we are seeing a slowdown in the number of homes closed. The tail end of this year could bring fewer transactions, but will the slowdown be enough to place us behind 2020 numbers? Through July home sales are up 38.33%. We only need 4,328 sales from August through December to match 2020 levels. That is approximately 866 homes per month. Our lowest month of the year was January at 1,221 homes sold, so it is likely 2021 will set another record.
Local Home Sales Highest on Record
The frenzied pace of home sales has eased a bit, but many homes are still receiving multiple offers, especially if they are in good condition. As companies return to work Florida may not be the work from home darling it once was. However, it remains to be seen what effect the Delta variant will have on companies work from home policies going forward.
We are hearing cases in Florida have leveled off and cases up North may be increasing. If this continues, Florida may become the work from home darling location again.
This is good news for home buyers. Buyers will have more choices and less price increases to contend with. Rising interest rates are like a hidden price increase because it increases the cost of ownership. We would suggest buyers take advantage of any home they like because even if prices level off that home may cost them more in the future.
Sellers should beware. If the SW Florida real estate market is properly valued, rising rates will have a negative effect on buyers. For years we felt Florida real estate was undervalued. With recent price increases, Florida has come more in line with the rest of the country. Who is to say if we are properly valued or not? The point is, it feels like values may bounce around where they are now, but who knows. Rising rates will put pressure on buyers who need to finance.
This past year sellers have been blessed by cash buyers from up North. We will be tracking cash sales going forward as that will be an indicator of how much fuel there is for rising prices going forward.
Covid Declining in Florida
The good news for Florida is that Covid cases have begun declining. They are much too high right now, so we are glad to see a plateau. As the weather turns and Floridians go outside in the Fall, northerners will head inside more in the Fall and Winter. We may see a decline in cases in Florida and a rise in cases up North. If this scenario plays out, we could repeat this past year’s process all over again and Florida could become the darling.
As regular readers know, there are several wildcards we look for. I feel like this year we are tracking new wildcards. I don’t know of anybody who can say with any certainty what the future of real estate is for SW Florida. We will continue to report what we do know with facts. We make assumptions and educated guesses from these facts and we hope you appreciate our attempt to explain what we are seeing in the trenches.
Our guesses may turn out to be 100% correct, or 100% false, or somewhere in between. Perhaps we are looking at the wrong indicators.
Real Estate Questions?
If you have real estate questions, or would simply like to talk about your situation, call Sande or Brett Ellis 239-310-6500 You can also visit www.SWFLhomevalues.com to get your home’s online value. Not only is it fairly accurate, but it will also keep you updated as to your home’s price direction. In other words, even if you disagree with the computer’s price estimate, you will be able to track the direction of your home’s value monthly. Sellers really like this feature.
Brett or Sande can get you a more accurate price for your home when we meet.
Good luck and Happy Selling!
See last week’s article “Lee County Sales Prices Hit Pause in July“