SoFlo Real Estate Talk

Thom and Rory talk about the current market stats informing you of all things real estate related covering the areas from Martin County south to North Palm Beach County.

 

July 8, 2021

Are You Waiting To Buy A Home Until Prices Drop?

Thom and Rory share stats, articles, and graphs that may make you change your mind. 

 

are you waiting to buy a home until prices drop

 

Are you waiting to buy a home until prices drop? Not sure of your next move? Are you concerned about buying in a hot market or is now even a good time to buy? As 2021 progresses, questions about what’s coming are top of mind for buyers and sellers. Near record-low mortgage rates along with rising home prices started off 2021 with a robust housing market in the first half of the year, but what does the forecast tell us about what’s coming for the 2nd half of 2021 and forward?

Mortgage Rates Will Likely Increase, but Remain Low

Many experts are projecting a rise in interest rates. Freddie Mac’s latest quarterly forecast is that mortgage rates will continue to rise through the end of next year estimate that the 30-year fixed mortgage rate will average 3.4% in the fourth quarter of 2021, rising to 3.8% in the fourth quarter of 2022.

However, even as mortgage rates rise, their anticipated increase is expected to be modest, and well below historical averages, thus allowing homebuyers to maximize their purchasing power. Home Price Appreciation Will continue but Price Growth Will Likely Slow.

Joe Seydl, Senior Markets Economist at J.P. Morgan, also projects home prices will continue to rise, so buyers interested in purchasing a home should do so sooner rather than later. Waiting to buy a home or waiting for rates or home prices to fall may not be in their best interest: Other experts remain optimistic about home prices, too. The graph below highlights 2021 home price forecasts from multiple industry leaders:

Are you waiting to buy a home until prices drop?

are you waiting to buy a home until prices drop 2

 

Inventory Is Still A Challenge

There Are Reasons To Be Optimistic

Home prices are rising, but they should moderate as more homes come to market. George Ratiu, Senior Economist at realtor.com, says there are signs that indicate the current inventory challenges may lessen, thus slowing the rapid home price appreciation and generating more choices for buyers.  He also says there have been more new listings this year compared with 2020 in 11 of the last 13 weeks with an influx of new sellers over the last couple of months.

New construction home starts are also starting to improve, which further supports hopes of more options coming to market. Robert Dietz, Chief Economist at the National Association of Home Builders (NAHB) says there are now 652,000 single-family homes under construction. This is 28% higher than a year ago.

Finally, while it may not change the current housing market we’re experiencing, more homes might come to market this year thus improving the economy according to Mark Fleming, Chief Economist at First American, who also notes that growing consumer confidence, a stronger labor market, and higher wages have potential for housing demand. While a growing economy and improving conditions with the pandemic may also motivate existing owners who were on the sidelines, to list their homes for sale, yet not enough to tilt it from a super sellers’ market anytime soon.

Bottom Line: As we look at the forecast for prices, interest rates, inventory, and home sales, experts remain optimistic about what’s on the horizon for the second half of 2021. But again, if you are waiting to buy a home, it’s currently looking like it would be better to buy sooner than later. Let’s connect today to discuss how we can navigate the market together in the coming months.

 

 

The information contained, and the opinions expressed, in this article are not intended to be construed as 
investment advice. The Thom and Rory Team does not guarantee or warrant the accuracy or completeness of the
information or opinions contained herein. Nothing herein should be construed as investment advice. You should
always conduct your own research and due diligence and obtain professional advice before making any investment
decision.
June 28, 2021

South Florida Real Estate Market

South Florida Real Estate Market

As you will see in the video covering the South Florida real estate market, the closed sales for single-family homes for May 2020 to May 2021 have jumped up 96.5% and the closed sales for the first 5 months of 2020 compared to the first 5 months of 2021 went up 33%.

The median sales prices for the South Florida real estate market also went up 13.7% from May of 2020 to May of 2021 and the median sales prices for the first 5 months of 20 versus 2021 went up 27.5%.

 

The inventory for the South Florida real estate market for sale in May of 2020 versus May of 2021 has gone down a massive 65.2% bringing the month's supply of inventory to a historic 1.1 months. That means less than 1 month supply of inventory. So if no other homes come on the market, what's left in Jupiter would be sold out in 1.1 months!

However, looking at the national trends, we are seeing inventory pick up from the beginning of the year at 1.9 months in January 2021 to 2.4 months in April.

The inventory for North Palm Beach County in January was 1,734 homes. In May it's dropped to 1128 homes. Condos and townhomes in January were 2,325 and are now 1,170 for May.

New listings coming on the market in January were 856 and may is 903 so there's a little bit of a positive trend there. Townhomes and condos in January were 979 is down to 848. This decrease is likely due to people that cannot afford to buy single-family homes are turning to condos and townhomes.

Of course, this is great news for sellers. It's not all bad news for buyers though. If you are thinking of buying a home, we have a lot of strategies that we use to put buyers in a strong negotiating position when making offers on homes.

Most economists predict that home prices will continue to rise but not at a dramatic pace. They predict an average of 8.2% price appreciation for the remainder of 2021. So, again, if you're thinking of making a move, it's still best to do it sooner than later before interest rates AND prices go up this year and next. As we've discussed before, there's no evidence there will be any kind of "Bubble" bursting and causing prices to drop.

For the full story and more information please see the video.

June 10, 2021

Will The Bubble Burst?

Will the bubble burst 2021

 

We put this video together after having several conversations this week and several more last week with people that would love to sell their home but they don't know where they're going to go. They know they could sell quickly and they're afraid if they do put their home on the market they won't have a place to go.

 

Will The Bubble Burst?

Some say that they're waiting for the bubble to burst and home prices to come down. Most economists agree that this situation is NOT like it was in 2008 when people were getting adjustable-rate mortgages and then when the mortgages would adjust they couldn't afford the payments so that's when the banks took them back in foreclosure.

So again nothing like that now is happening. In fact, we now have tight lending standards with historically low fixed-rate mortgages (not adjustable) and there's a lot of cash purchases. Banks don't foreclose on cash purchases nor do they foreclose on homes with lots of equity. Yes there are some homes in forbearance that will come out of forbearance without solutions and banks will take them back and they will be sold on the open market. But that's a small percentage and they will get quickly absorbed by the demand for homes. Banks would rather work it out with those homeowners than foreclose. It costs them so much money and time to foreclose.

Some people are saying that Florida is the Last frontier like California was back in the 1980s. They are saying you can spend over $1 million for a one-bedroom home in many places in California. There's only so much land in Florida and moving inland is not an option for a lot of people who want to be near the beach. They want the ocean breezes that you don’t get inland and they want the Florida beach lifestyle. As you go west and south are you going to the Everglades where you can’t build.

There's a lot of people moving here that can work from home now and into the future. They want OUT of the winter weather and into the sun. They want no state income tax.  They want lower real estate taxes.

So for the foreseeable future, it looks like prices are going to continue to rise. If you're thinking that it's better to make a move now while prices are where they are then we're here to help. Check out our First Buy, Sell Later Solution in the video below. Reach out to us with any questions you may have and if you want more information, as always, We're here to help! Thanks.

Oct. 21, 2019

60,000+ More May Qualify For Condos

60,000+ More May Qualify For Condos

HOW TO BUY A CONDO USING FHA WITH ONLY 3.5% DOWN.

Questions like: How to buy a condo with bad credit? FHA low downpayment for homebuyers? Down payment assistance? No down payment first time home buyer?

New Financing Guidelines Opens Doors for Many More Buyers.

FHA (the Federal Housing Administration) just opened up the opportunity for buyers to purchase condos with as little as 3.5% down.  So this will allow people who want to get out of renting, people who have lower budgets, lower credit scores and higher debt to income ratios to be able to purchase a condo which is typically priced less than single-family homes.

Buyers used to need a minimum of 20% down to purchase a condominium. It also used to be that an entire condominium community had to be FHA approved in order for a buyer to be able to put down 3.5% for the purchase. This new program allows the FHA to approve condominium units individually.

Due to their lower average price point, condominiums are a vital source of affordable housing, particularly for first time home buyers entering the housing market. This change will make it possible for a much larger number of people to become homeowners. It will also help sellers of condos by opening up the opportunity to more buyers.

The condo must be your primary residence for this program. Some buyers steer away from condominiums because they feel the condominium monthly fees are high. But what people may not know is that the monthly condo fees include a lot of things that homeowners would pay for on their own separately if they owned a home not in a condo or homeowners association.

Things like insurance on the building, maintenance of the building and roof, water, sewer, cable, internet are all covered in that monthly fee. With condominiums and homeowners associations, you are buying these services in bulk at a discount. With most condominiums, you typically only pay for your electric.

On Wednesday, August 14, 2019, the Federal Housing Administration issued an update to its condominium rules, which go into effect October 15, 2019. The FHA said it expects the updates, which are intended to improve access to affordable and sustainable housing, will allow an estimated 20,000 to 60,000 more borrowers to qualify for condo loans.

 

Aug. 27, 2019

Jupiter Florida Real Estate Market Report July 2019

Jan. 31, 2019

Average Home Price In Jupiter Fl Jan 2019

Average Home Price In Jupiter Fl Jan 2019

Hi everybody. It's Thom Montrois with the Thom and Rory Team and Remax Properties here in Jupiter Florida. You know we're always getting asked how is the real estate market in the Jupiter area. So I thought this quick video would give you a sense of what's happening.  

So we have a couple of different stats for Jupiter. We have just the month of December in 2017 and 2018 and then we have the entire year of 2017 and 2018 so I'm really just going to focus on the entire year at this point.  So the closed sales we had went down 7.3 percent and the median sales price, that is half sold higher and half sold lower, that's actually up almost 9 percent. The average sales price is up almost 20%.

Jupiter Inventory Down

Our dollar volume is up 10.8 percent and the percentage of original list price received is holding steady right around 94 percent of this price is what sellers are getting. The median time to contract was actually down so it's taking a little bit less time to get them under contract.  The pending sales are down to 8.1 percent. The new listings, those are also down almost 10%.

You're probably hearing in the news that things may be shifting towards a buyers market.  Jupiter is a little bit different than the rest of the area. You're probably hearing that for Palm Beach County and possibly the state of Florida.

There's a lot of demand to be in Jupiter

We have low crime. We have great schools a lot of green space so we're just not seeing that buyer's market here yet. The demand is still high and there are not as many listings as we'd like to see. We have some buyers still waiting in the wings not finding the right house.

If we go down to the townhouse and condo market, the same stats, the closed sales, we're down 3.1 percent. The median sales price were up 9%, and the average sales price is up to 10%.  The dollar volume is up just a little bit more because townhomes and condos cost less than the single-family homes.  The percentage sales price received is still right around 94 percent. The median time to contract is down again 8.2 percent which is good. They're going under contract quicker because the demand is still there. Pending sales are down 7 percent and again new listings is down 2.2 percent.

We do have these stats for other areas, not just Jupiter. We all the other towns and cities for Palm Beach County. We also have some trends stats if you're interested in any of those areas, we'd be happy to share them with you. And always remember we're here for you if you just have real estate questions.

Thanks so much for watching.