South Florida Housing Market Update [October 2023]

Introduction

Hello, I'm Andy with the Mandel Team at REMAX. Today, I bring you the October 2023 housing market update. We'll focus on single-family homes in Boca, Parkland, and Coral Springs, where our team does the majority of our business. Let's dive in.

The Stats That Matter

We aim to give you leading indicators to show where the housing market is headed, not where it's been. Media often talks about closed sales prices, which reflect the market 30, 60, or even 90 days ago. We want you to know what's happening now.

New Listings: The Supply

• Boca: Up 6% compared to September 2022
• Parkland: 20% fewer listings
• Coral Springs: 17% fewer listings

Pending Sales: The Demand

• Boca: Up 16.4% compared to last year
• Parkland: Down 3%
• Coral Springs: Down 8.6%

Days on Market

• Boca: 21 days
• Parkland: 25 days
• Coral Springs: 22 days

Closed Price to Original List Price

• Boca: 95.5%
• Parkland: 95%
• Coral Springs: 98.5%

Month's Supply of Inventory

• Boca: 3.44 months
• Parkland: 0.22 months
• Coral Springs: 1.73 months

What Does This Mean for Buyers?

Interest rates are currently close to 30-year highs, hovering around 7.5%. This has deterred many potential buyers. However, there are strategies like the 3-2-1 interest rate buydown that can make homes more affordable.

The Numbers in the Example

Let's consider you're buying a $700,000 house and putting down 10%, which means you're getting a mortgage for $630,000. At today's 7.5% interest rate, your monthly payment would be about $4,405, not including taxes, insurance, and HOA fees.

With a 3-2-1 buydown, the seller gives you a credit of $29,567 to pre-pay your interest for the first three years. This reduces your monthly payments dramatically:

• Year 1: $1,212 less per month
• Year 2: $827 less per month
• Year 3: $423 less per month

This strategy is more beneficial than a straight $30,000 reduction in the purchase price, which would only save you $189 a month.

What Does This Mean for Sellers?

Sellers are still in control of the market, but that doesn't mean you can set any price you want for your home. Buyers are more educated and cautious due to high interest rates.

Pricing and Marketing are Key

Homes that are priced correctly and marketed effectively are selling quickly, often in just a few days. Being upfront and realistic about your home's market value can make all the difference.

Navigating a Market with Fewer Buyers

With fewer buyers in the market, sellers need to be more strategic. Offering incentives like the 3-2-1 buydown can make your property more attractive and help close the deal faster.

Conclusion

Real estate is a "get rich slowly" game. Buying now with strategies like the 3-2-1 buydown can make the payment affordable and allow you to take advantage of future price increases. If you have any questions, whether you're a buyer or a seller, feel free to reach out.