It has certainly been interesting over the last decade to see prices skyrocket with easy lending practices… to the bubble bursting and the market tumbling resulting in the #1 state for foreclosures… to a rebound in the economy and decline in unemployment… to a renewed demand for Florida living resulting in the current market flurry! Actually to call this market condition a ‘flurry’ is a huge understatement. With inventory decreasing monthly and demand on the rise, the numbers tell the story!
We have been watching and sharing in our market updates the month by month Absorption Rate since 2008. Take a look at what is happening in this chart. During the month of June, 42.9% of every single family house in Pinellas County was SOLD! That number is unprecedented. Going back as far as June 2008, the Absorption Rate was 7.3% to give a perspective. Let’s put that into the actual number of listings at the end of June. In 2010 there were 6479 single family home listings in the county at the end of June… for 2015 3242 or 50% of that number! These numbers go for condos as well. At the end of June in 2010 there were 5344 listings while this year ended the month with only 2636 – 49.3%!
On the flip side, it makes sense to compare sales… during the month of June in 2010 802 homes sold and 424condos. This year there were 1390 home closings and 813 condo closings during June! In 1 year the median price for single family homes has risen from $165 to $185. For condos, $110 to $117. The other two factors worth noting is that 34.3% of all sales during June 2015 were for listings on the market between 1 and 30 days… and cash sales are still prevalent but are down to 50% (they have hovered around 60-65% for years). Lending with conventional financing is starting to make a comeback.
Here is a real example that happened last Friday: cute home in St. Petersburg came on the market listed at $127,900. A buyer put in the first offer that day for full asking price with 80/20 conventional financing. By Sunday there were 4 offers on the table, 2 over asking price and 1 all cash. The seller went for the all cash deal. With this kind of Absorption Rate, it is not uncommon for the seller to be able to choose which offer he wants to go with. If you are considering selling a property, you might want to consider some of these tips: Top 10 Real Estate Tips There are tips for both sellers and buyers.
If you are a buyer in this market, you need to expect competition. We have found our VIP Buyer Program to really helps! You enter your criteria of what you are looking for and as a property is listed you get it automatically emailed to you immediately. You have your own portal where you can review and rate properties… then let us know when you want to go see one. It is free and just that simple! Most importantly, if you are considering financing you need to get pre-qualified with a bank or mortgage broker. Without that it is more likely the seller will select another offer.
The other trend we are watching closely is the renewed onset of new construction. Builder confidence has just reached a level of 60, the highest level since November 2005! “The fact that builder confidence has returned to levels not seen since 2005 shows that housing continues to improve at a steady pace,” says NAHB Chairman Tom Woods. “As we head into the second half of 2015, we should expect a continued recovery of the housing market.” The PURTEE Team has a great deal of experience with buying and selling pre-construction. It is critical when buying a property sight unseen that you do your due diligence and understand thoroughly how the process works. You can find the full article on Builder Confidence on our Purtee Team Facebook Page and we will be posting interesting new construction projects on our page going forward.
Our team continues to get bank owned properties weekly, most of which have multiple offers once they are listed on MLS. If you are interested in learning about these properties before they hit MLS email us at firstname.lastname@example.org and put REO Request in the subject line.
Whether buying or selling, we are here to help you navigate this real estate market. Contact us today!