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The housing market is cooling, but buyers will face a tough time for a while

The pace of home sales in Florida continues to push prices higher.
Wilfredo Lee
/
AP
The pace of home sales in Florida continues to push prices higher.

The red-hot housing market may be moderating in Northeast Florida, but potential buyers still face challenges.

Prices are rising more gradually, but homes are becoming less affordable.
The median sales price for a single-family home in Northeast Florida rose to $351,495 in February, 24.6% higher than the same time last year but only 2.7% higher than January, according to the Northeast Florida Association of Realtors. But inflation and rising interest rates are making it harder for the typical family to afford a home.

The "affordability index" — a measure of how easily a family can afford a home at current interest rates, prices and incomes — has declined 27% in a year and 5.2% in a month, meaning it's that much harder to afford a home in Northeast Florida.

"These factors are hard to predict in the future, but a good guess is that interest rates will continue to increase, creating more urgency for those that need — or want — to make a move to a new home," said the association's president, Mark Rosener.

Sellers are in a better position than ever.
A third of homes that sold in February went for more than the list price, the Realtors association said. That was 3.9% more than the month before and 73.8% higher than February 2021. Virtually every seller got at least what they listed for. "With 100% of listings selling at asking price and 33% over list price, there is a need for urgency on the part of buyers to move quickly when a home that meets their needs hits the market," Rosener said.

It's hard to even find a home you might want.
Many homes are disappearing from the market before buyers can even look at them. The median time that a home lasted on the market in February was 17 days, according to Realtors association data. That was about the same as last year, but homes closed 15% quicker than the month before.

To compound the situation, fewer homes are even available. A total of 2,227 homes had active listings last month, 15.6% less than the month before and 33.9% less than a year ago. New listings totaled 2,192 in February — 1.3% more than January but 6.7% less than February 2021.

Investors are buying up a lot of the homes.
Investors — meaning any institution or business that buys residential real estate — bought 29.8% of the homes sold in Greater Jacksonville in the fourth quarter of 2021, according to a report from Redfin, an online real estate service that studied the nation's 50 most populated metros. Only Atlanta and Charlotte, N.C., had a larger share of homes sold to investors. And no city saw a greater increase in investor purchases than Jacksonville — 157% higher than the year before.

Investors are particularly interested in Jacksonville because homes remain lower priced than in many areas, enabling investors to charge higher rents and sell flipped homes for higher prices. But the competition makes it more difficult for average people to buy homes.

“Investors are chasing rising prices because rental payments are also skyrocketing, incentivizing investors who plan to rent out the homes they buy," Redfin reported. "The supply shortage is also an advantage for landlords, as many people who can’t find a home to buy are forced to rent instead."

In individual counties

  • St. Johns County remains the most expensive place to buy a home in Northeast Florida, according to the Northeast Florida Association of Realtors, which covers Duval, Baker, Clay, Nassau, Putnam and St. Johns counties . Single-family homes in St. Johns County sold for a median price of $480,000 in February, although that was a slight drop from $481,893 the month before.
  • Homes went the fastest in Clay County, with a median time of 15 days on the market. Homes remained on the market the longest in Nassau County: 33 days.
  • Putnam County, traditionally the most affordable area to live in Northeast Florida, became significantly more expense. The median price of a single-family home rose 12.5% in February, to $225,000.
Randy comes to Jacksonville from the South Florida Sun Sentinel, where, as metro editor, he led investigative coverage of the Parkland school shooting that won the 2019 Pulitzer Prize for public service. He has spent more than 40 years in reporting and editing positions in Illinois, Iowa, Missouri, Ohio and Florida. You can reach Randy at rroguski@wjct.org or on Twitter, @rroguski.