- November 28, 2016
- Thomas Adam
- Real Estate
The latest trends and reports from Florida Realtors® demonstrate shifting tides in the Florida real estate market that seem to favor sellers.
The median sale price of single family homes rose from $199,900 to $225,000 between August 2015 and August 2016. This means that housing prices are on the rise and sellers, especially those who bought when the market was low, are seeing potential to profit from their investment. As prices continue to rise so does the risk that the market will hit an apex and begin to decline.
Lending credence to the possibility of a downward trend is the fact that during the same period (Aug. 2015-2016), the number of single-family homes purchased with cash has decreased by 12.2%. This could signal increased confidence on the part of both lenders and borrowers in financial conditions. However, more credit sales yield more foreclosures which, in turn, yield lower prices. The data suggests a decrease in the amount of foreclosures in the period, however such trends would take a number of years to show up and likely reflect the stingy lending practices post-2008.
Aside from the gloomy potential that of potential market decline in the near future, there are other reasons real estate owners might want to sell. For one, the 12.6% median home price upswing is a big one. Additionally, sellers have been getting a larger percentage of their asking price, up .7% from 95.7% to 96.4%. And these higher priced sales are happening in a shorter period of time. The median time to contract has decreased from 48 days to 40 days and the median time to actual sale has decreased from 93 days to 88 days. For many sellers, this means more money, fewer hassles.
However, there is always a flipside and there are valid reasons some may want to buy real estate now. Notably, while the number of new listings has increased by 10%, inventory has dropped by 4.3%. Decreasing inventories and rising prices mean that supply is starting to run short while demand at least remains constant. If you are the type that is bullish on the Florida economy, the quickly rising median home price represents an interesting opportunity to make a profitable investment in Florida real estate. Combined with the most free-flowing credit environment since 2007, buying may be a smart move.
Whether you are buying or selling a home that is your primary residence, or an investment property, the amount of money changing hands may represent the largest transaction you ever take part in. And it can be a complicated one. Especially following Hurricane Matthew which opens up a lot of questions for those under contract before the storm. It is thus, an important transaction to fully understand and execute correctly. The Florida real estate attorneys at Adam Law Group can help guide and protect you during the process.