South Florida Housing Market Update [August 2022]

Hey, it's Andy with the Mandel Team at RE/MAX. And I'm here to bring you your August, 2022 Housing Market Update. As always, for the purposes of these videos, we're gonna be talking about single family homes only, in Boca, Parkland, and Coral Springs. Those are the areas where our team does the predominant amount of our business. And when we talk about these numbers, we're talking about single family homes only, no country clubs, no townhouses, no condos, no 55 and over. So we're gonna give you that what's going on right now versus which you're normally seeing in the media. They're giving you stats that are sometimes two, three months old. So we're showing you what's happening right now to give you an indication of where the market is headed, not where it's been. So let's get into it. The first stat we like to look at is the number of new listings hitting the market. That's the supply. In Boca and Parkland, they're about the same number as they were last year, but coral Springs, the number of new listings is actually down 33%. The next stat we like to look at is the number of pending sales happening. So homes that are going under contract and coming off the market.

Across the board, that's down, on average, about 33%. So we're seeing, on all three cities, and really across the whole south Florida area, 33% fewer sales. There are way fewer buyers out there than there were this time last year. We're seeing it on our listings because they're taking longer to sell, which brings us to our next stat, the days on market. Now, across the board, that is up to, on average, 12 days. That's up from 10 days this same time last year. So it's not a significant difference, but it definitely is taking longer to sell. We're really feeling it on our listings, and we're getting closer to what the market was like in 2019 and before, pre-pandemic. It doesn't mean the market's crashing, homeowners can't sell, and they gotta slash their prices crazy numbers causing the market to drop. That's really not what's happening. We really are just getting back to 2019 numbers. So everyone was complaining that, oh, the market was moving too quickly and it was just too crazy. Now that we're getting that, we're getting what everyone wanted in normal market.

The next stat we like to look at, to be fair, it isn't they're forwards looking stat, it is a backwards looking stat, but I wanna look at the original list price to sales price ratio to see what kind of price reductions we're having and how that's starting to affect the market, 'cause we definitely are starting to see price reductions more frequently. The average close sales price to original list price is still 99.1%. So while it is taking longer to sell, sellers are being patient and holding firm to their prices, and they're still getting them. Home values are not plummeting like many people we're predicting or hoping for. It's just taking a little bit longer to sell.

Now, the next stat we like to look at is the month's supply of inventory. This is what I think is the most important stat. So what this tells me is if no more homes were to hit the market, how long would it take, at the current pace of sale, for all of the homes to sell? So a balanced market is somewhere around six months. Anything less than six months is a seller's market, anything more is a buyer's market. Pre-pandemic, we were sitting around three and a half-ish months of inventory, during this whole pandemic, we were about one month in certain cities. Coral Springs, a lot of times, was at half a month to three quarters of a month. So three weeks of inventory. It was a super crazy low inventory environment.

And right now in Boca, the month's supply of inventory is 3.17, Parkland is 3.22, and Coral Springs is much lower, but it's 1.6 months of inventory. So like we were just saying, it is still a seller's market. Anything less than six months is a seller's market. And we were in a seller's market prior to this pandemic craziness. But, then these inventory numbers are about three times what they were last summer. Boca and Parkland were sitting roughly at about one month of inventory, Coral Springs half a month to three quarters of a month. So even though Coral Springs is still really low in inventory, it's three times more inventory than it was last summer. Interestingly, what we're starting to see is that inventory has gone up a lot more in the higher price ranges that you typically see in Parkland and Boca compared to Coral Springs. Because inventory is still much tighter in Coral Springs compared to Boca and Parkland, even with the drop in the number of sales being relatively the same across the board, it's remained more of a seller's market in Coral Springs than the other cities.

Coral Springs is definitely not cheap, but price points are much closer to the median for the county, compared to the more expensive cities like Parkland and Boca. So this is a good opportunity for buyers of more luxury properties to get a better deal. Sellers are gonna be more likely to negotiate with you if there is a lot more inventory and buyers have more options in these more expensive price ranges, which is what we're starting to see. So let's talk about what this means if you're a buyer and if you're a seller. Well, if you're a buyer, this is the best time we've probably seen in the last two years, at least, to go buy a property. Yes, interest rates are a lot higher than they were at the start of the year, but they've definitely come down a lot since the beginning of July. Rates peaked at around just above 6% in the beginning of July, and they've come down steadily since. And right now, we're sitting at about 5%. So down a full percent from July, that's where they were three, four months ago, back at the beginning of May, it's at basically the same level. So it's a good time to be a buyer because more inventory is opened up, especially in these luxury price ranges, homes are sitting longer, there's less buyer competition, so instead of having 16, 17 offers on every listing, and buyers having to wave their inspection, their appraisal, give up their firstborn child, they're not having to do that right now, and we're starting to see you get a little longer to be able to make a decision. You can come back for a second showing. Sellers are a little more likely to negotiate on certain things, especially after inspections. So it's a better time to be a buyer now than last year. So if you've been putting it off and waiting for this market to cool down, this is your opportunity.

A lot of buyers are still sitting on the sidelines take advantage of that and you'll have less competition, and you can find the house that you're looking for. Sellers, what does this mean for you? Well, the days of putting your home on the market 50 grand above the next highest house that ever sold in your neighborhood and getting 15 offers and selling for higher than that, it appears those days are definitely over, but it doesn't mean that prices are crashing and you're not getting a good price. You're still getting really good prices. We're just not setting record highs, and we're selling 50 grand above appraised value like we were six months ago, eight months ago last year. That's just not happening, but it's still a good price, so it's still a very good time to be a seller. The other benefit of being a seller right now, a lot of people didn't wanna put their home on the market 'cause they didn't know where they were gonna go. They wanted to move up to a bigger house, but they couldn't find it, and it was selling so quickly. That's not happening right now. Homes are sitting a little bit longer so you have less worry of, "If I put my home on the market now, I know it'll sell, and then I'll be homeless." You still have to move quickly. It's still challenging to do that move no matter when you're doing it, pandemic or not, but we can walk you through that, and there are more options to choose from that aren't flying off the market. It's a great time to be a seller and definitely a better time now to sell and have to buy than we've seen in the last two years. So it's definitely a dynamic market, it's definitely changing. We have our thumb on the pulse of what's going on here. Our team's on pace to sell over 200 homes this year. We know what's going on in this market. If you are thinking about making a move in South Florida, we would love to help walk you through that process. Give us a call or shoot us a text or send us an email. We got your back. We're moving in South Florida, and I'll see you on the next video.