Published September 14, 2023
On September 11th, The Wall Street Journal reported national home prices were 13% lower than last year. I’m sorry, but there is no national market. All real estate is local.
In Sarasota County, prices were essentially the same, slightly above one year ago. In August, the average sold price per square foot for existing single-family homes was 2.2% higher than last year at this time. The median sold price on par, month over month at $525,000.
At 1,391 homes for sale, the supply of inventory is increasing, 26.6% year over year, 1% more than last month. Although inventory has increased, it remains historically low, and there is no sign that prices are tanking.
In a supply-constricted market, notwithstanding 7% + interest rates, there are more buyers than sellers. Buyers are more sensitive to the change in mortgage rates than the actual rate. In October 2022 rates reached 7.08%. Over the next 3 months the median sold price went down 12%, from a high of $534,000 in October 2022 to a low of $450,000 in January 2023. By February 2023, as buyers warmed to higher rates, the median sold price began to ascend, from $490,000 in February to $525,000 this past month. Similarly, following October’s rate spike, on average there were 12% fewer sales over the next 3 months. But by February, sold homes began to ascend, ending August with 515 sold homes versus 439 in October 2022.
Affordability matters, and therefore, prices are likely to stay flat through 2024. But barring rates approaching 8%, there is no indication prices will go lower. Mortgage rates will have to fall substantially to see any significant home price gains.
Remember, your home is the place where you live, enjoy your life. Don’t let market conditions keep you from achieving your dreams. The market is always open. There is always opportunity.