People looking to buy a home in Northeast Florida are finding an easier time of it.
The number of the homes on the market is rising; they're becoming more affordable; and they're remaining on the market longer — a dramatic change from the frenzied market of pandemic months, according to the Northeast Florida Association of Realtors.
Although the market usually heats up in the spring, it seems to have begun early this year, association President Diana Galavis said in a news release.
“The weather is warming up and so is the market,” Galavis said. "The spring selling season is off to an early start."
The median sales price of a single-family home in Northeast Florida dropped 2.7% in January to $360,000, the Realtors association announced. New listings jumped 34% to 2,650, and homes remained on the market for a median of 55 days, up 14.6% from December.
For the past year, competition for limited homes has frustrated homebuyers across Florida. But 162% more homes were on the market in Northeast Florida last month compared with the year before, the Realtors group reported.
With prices edging downward, homes are becoming more affordable for average people. The region's home affordability index increased from a low of 67 in October to 76 in January. An index of 100 would indicate that the average family has the amount of income needed to afford a typical mortgage.
Redfin, a real estate brokerage, said the housing market has begun to recover after hitting a low in the second week of November.
Buyers have acclimated to the 6% mortgage rate, which feels like a relief after rates surpassed 7% in the fall, Redfin said. Some buyers are even scoring a rate that starts with a five, an important psychological threshold, while others are opting for an adjustable-rate mortgage or getting a rate buydown as a seller concession.
That's not to say homes are cheap. The median sales price in Northeast Florida is still 5.3% higher than a year ago, and Florida as a whole remains overpriced, according to a study by Florida Atlantic and Florida International universities.
Six of the 10 most overpriced markets in the nation are in Florida, researchers found. Jacksonville's average price in December was 43% higher than it should have been, based on historical trends, the study showed. But Jacksonville was less overpriced than seven of eight other metro areas in Florida.
“It used to be that you didn’t need a big salary to afford a home in the Sunshine State, but those days are over because this has become a market mostly for move-up buyers and empty nesters,” said Ken H. Johnson, a real estate economist in FAU’s College of Business. "Florida’s relatively low incomes should make housing affordability a key issue for a long time.”
Home prices in Florida are not likely to plummet, the study said, because people are continuing to move here. Areas with stagnant or declining populations and more homes on the market could face significant price declines, the researchers said.
