South Florida Housing Market Update [July 2022]

Hey, it's Andy with the Mandel team at RE/MAX. I'm here to give you your July 2022 Housing Market Update. As always for the purposes of these videos, we're gonna be going over the leading indicators of where the real estate market is headed, not where it's been. And when we do these videos, we're specifically focusing on Boca, Parkland and Coral Springs. Those are the areas where our team does the predominant amount of our business. And we're gonna be talking about single family homes only. No condos, no townhouses, no 55 and overs, and no country clubs. So let's get into it.

The first stat we like to look at is the number of new listings hitting the market. Now there's a big divergence. The number of new listings was up 36% in Boca, but it was basically flat in both Coral Springs and Parkland. So a lot more listings hitting the market in Boca, basically the same as it was in 2021 in Coral Springs and Parkland. At the same time, the next step we like to look at is the number of pending sales, the ones that are coming off the market and going under contract. That's down on average, across the board, about 39% compared to this time last year.

So, depending on the city, it could be flat or a lot more inventory, but definitely way fewer sales. There are a lot fewer buyers out there right now looking to pay these prices and these interest rates. So the market is definitely shifting. The next step we like to look at is the number of days on market. How quickly it takes for a home to go on the market and then sell. On average, that was 11 days across the board. That's up from nine days this time last year. So, like we've been predicting, home sales are going down. There's fewer and fewer sales. And that means they're taking a little bit longer to sell. Still, realistically, 11 days is not that long of a time. The good priced homes are still selling very quickly and you do still have to make competitive offers, but buyers are getting a little bit more time to think about properties. They don't have to go in in the first five seconds of a home and make a decision right there, write a crazy offer. There's a little bit more time.The next step we like to look at is really a backwards looking stat, but that's the closed price to list price. Now last month, that was still at 100%. So sellers are still getting 100% of their asking price. But I predict there's gonna start being a little bit more negotiating room as the year continues to go on.

The next stat we like to look at is the number of months supply of inventory. So what that means is, how long would it take for all of the homes that are currently on the market to sell, if no more homes hit the market. This is probably the most important stat and that is actually up. So in Boca, we're at 2.73 months, which is about twice as much inventory as we had this time last year. Parkland is 2.56 months, again, about twice as many homes compared to this time last year. Coral Springs is still really, really low. It's still only 1.19 months of inventory, which is definitely up, but not near as much as the other two cities. So, as home sales continue to decline, the number of sales go down and more homes hit the market. This month's supply of inventory is going to continue to tick up. A balanced market is six months, so it would take six months for all the homes to sell. Anything less is a seller's market. Anything more is a buyer's market. And we've been in a seller's market, even pre 2020, we were in a seller's market. We were about three and a half to four months of inventory. It's been crazy, in one month or less inventory, basically, since COVID came out. But it's starting to creep back up to a more normal market, which is good.

The market isn't crashing, it's just shifting back to pre COVID times and pre COVID norms, which is a good thing. So it would appear that the lower price properties are still selling very fast, and the market is extremely strong for homes closer to the medium price range. But as you get into more expensive markets in Boca and Parkland, it is definitely, significantly slower. You really feel that. So let's talk about what this means. If you're a buyer, this is still a very good time to buy. It's actually probably a better time to buy than it was two years ago. If you felt like you were being rushed and you didn't like the options that were out there, there's more homes hitting the market, you have more options. You have a little bit more time to make a decision and you don't have to just jump on the first house you see and buy it. This is really good for buyers. Interest rates have actually come down a little bit since their highs. So you're in the mid fives right now, compared to the sixes, as it was a couple weeks ago. So there's still a lot of opportunity there for buyers who can come in and get a good deal. For sellers, what does this mean?

Well, like we've been predicting for a while now, the terms that you're gonna be able to get as the year continues to go on, are going to shift and they're gonna be less in your favor as a seller. We're starting to see fewer and fewer crazy multiple offer situations that are bidding the price up, way above the asking price and having no appraisal contingencies and all that crazy stuff that we were seeing. We're starting to see less and less of that. I know on our listings, we're seeing way more offers that are coming in 100% contingent on appraisal. They're not willing to pay above appraise value or significantly above appraise value, the way they were six, eight months ago. So, as the year goes on I think that's going to continue to be the norm, and it's gonna get to a more normal market where sellers are gonna have to negotiate. They're not gonna be able to get those six month free post occupancies and all that crazy stuff. But, if you have to sell in order to buy, because the market's getting a little bit slower and there's more homes for sale, it gives you more of an opportunity for you to get that slightly longer closing, find a good home that is the move up home or the move down home, wherever you're looking to move. There's more options out there. So you don't have to be scared, or as scared, to put your home on the market this year, as you did in the last two years. There are more options to choose from. It's a really good time still to be a seller. Prices are still really, really good for you. You're still be getting really good terms and there's more to choose from. So thanks for tuning into this video. I will see you next month. If you have any questions about the real estate market, we got your back when moving in South Florida.