Believe it or not, it's getting easier to buy a house
It's getting easier to buy a house in Northeast Florida — if you can afford it.
More houses are being listed for sale; sales are slowing; and bidding wars are declining, the Northeast Florida Association of Realtors said this week. But the median price for a single-family home hit a historic high of $392,000 in May, and homes became more unaffordable as both prices and interest rates rose.
"We are still fully entrenched in a 'sellers’ market' and will stay there for quite some time," said association President Mark Rosener. "However, there are more homes available for buyers, which should make it easier for them to find that home that best matches their needs. Multiple-offer situations seem to be moderating so that buyers do not find themselves in competition as much as they did six months to a year ago."
About 42% of single-family home sellers received more than their asking price in May, pushing the median price up 1.9%, the Realtors association said. For condominiums and townhomes, prices rose 2% to a median of $267,500, with 38.4% of sellers getting more than their listing price.
Homes in the Jacksonville area are growing even more overpriced, according to research released this month by Florida Atlantic and Florida International universities.
Homes prices in April — at an average of $355,286 — were 41.85% higher than they should have been based on historical trends, the universities said. That compared with 38.64% the month before.
But 27 metros in the U.S. were even more overpriced that Jacksonville, and Jax was better off than seven of the eight other metro areas in Florida, the data showed.
“Near-record-low mortgage rates helped fuel demand for housing, especially during the pandemic, and the competition for homes pushed prices higher. But now the Federal Reserve is raising rates to curtail inflation, and already that’s cooling demand,” said Ken H. Johnson, an economist in FAU’s College of Business.
The U.S. Bureau of Labor Statistics reported last month that the cost of housing increased 7% in the southern U.S. from April 2021 to April 2022. Inflation figures for May are due out Friday.
A looming slowdown in the housing market could help people priced out of the market get into homes, but it also may be a serious concern for some consumers, Johnson said.
“If we’re not at the peak of the current housing cycle, we’re awfully close,” he said. “Recent buyers in many of these cities may have to endure stagnant or falling home values while the market settles — and that’s not what they want to hear if they had planned to resell anytime soon.”
Buyers, on the other hand, might be encouraged. Several signs indicate that the red-hot market in Northeast Florida is cooling, according to the Realtors association.
The number of homes on the market increased by more than 10% from April to May, to 3,257 homes for sale in Baker, Clay, Duval, Nassau, Putnam and St. Johns counties.
Sales slowed slightly, and homes remained on the market a little longer — a median of 14 days, which was 16.7% higher than the month before.
Rosener noted that Realtors have seen more homes with price reductions, an indication that sellers had set their sights too high.
With more homes available, "it is very important that sellers be realistic in their pricing strategy," he said.