Sarasota County. It is a balanced, healthy real estate market. The days of ravenous price increases are gone. Comparing the fourth quarter of 2024 to 2023:

• At $500,000, the median sold price for existing single-family homes was the same.
• The average sold price, per square foot up 1.4%, at $351/sq. ft.
• Twenty-four percent more homes for sale.
• Five percent less homes sold.
• Average days on the market 71 days (up 31.5%).
• 6.6-month supply of homes for sale based on closed sales.

Nothing affects home prices, supply, and demand like mortgage rates. As regularly recited on these pages, as rates rise, prices go down. As rates fall, prices go up.

Although the market is nearing the upper limits of my 2025 forecast, I do not think mortgage rates will be much higher. My expectations for rates and prices are the following:

• The yield on the 10-year Treasury, most determinative of mortgage rates, will fluctuate between 3.75% to 4.75% (currently 4.623%).
• Mortgage rates will be between 5.75% – 7.25% (currently 6.7%).
• Prices will stabilize, rebounding from a 10-15% fall in 2024, ending 2025, 2-4% higher.

The Fed views a weakening jobs market as its hedge against inflation. In a weakening jobs market, rates go down – a strengthening jobs market, rates rise. Ergo, train your eye on the labor/jobs market, the unemployment rate, and jobless claims to deduce Fed action, the direction of Treasury yields and mortgage interest rates.

In the past few weeks “experts” have questioned the propriety of the Fed lowering its Fed Funds Rate a full 1% this past fall, that inflation is not under control. It is interesting to note  as I write this on Friday, January 17^th, Federal Reserve Governor Chris Waller, typically a hawk on Fed policy (inclined to raise rates) said on CNBC the labor market is solid, not booming, not falling, and rate cuts could occur in the first half of 2025.   

Focus on jobs, take note of residential construction jobs. The Fed Funds Rate, inflation, Treasurys, mortgage rates, home prices and supply … they will all rise or fall in alignment with the unemployment rate and jobless claims.

This is a volatile, uncertain time. But with guidance from a seasoned REALTOR®, you will be able to best position your home for sale. It is a good time to buy.