A two-and-a-half-year long trend in the South Florida and Delray Beach real estate markets is now history.
Regular viewers of my channel as well as who read my free weekly e-letter, and if you’re not on it, you want to be a part of it click here. It comes out every Wednesday morning. Regular viewers know that I’ve been talking about the rising inventory over the last 30 months. Back in May of 2022, inventory in South Florida was 14,500 units. Today it’s at 53,800 units. That’s about a 275% increase in just two and a half years.
And because of this inventory surge, the question is are we now finally at the final innings or the end of the appreciation game? One of the things is, is that we have more inventory today than we did pre-pandemic or back in 2019. So, the thought is, we’re back to normal Delray Beach real estate market.
I believe we’re in a market transition where home sellers are starting to fess up that rising prices are not going to happen forever. They’re bowing down to moderating prices. In other words, I think home sellers are finally leaving the denial phase.
Why? Because now we have high inventories. We have interest rates that have been moderating for the last year, and we have prices that are now stabilizing.
Before I jump into the Delray Beach real estate market data, the national data shows a lot of room for supply to rise. Why? Because industry experts are saying we’re still about 3.5 to 4 million units shy of demand. And when it comes to sales, 2024 might rival the lowest number ever recorded back in 1995 when there were just 3.5 million units sold.
Also, on the national scale, back in October 2021, the months of supply (MOS) bottomed at 3.3 months. That was one of the strongest seller markets ever recorded. But today, the MOS is 8.9 months (Anything below 6 months of inventory is a seller’s market… above 6 months is a buyer’s market). So at 8.9 months, we are in a firm buyer’s market.
At the same time, mortgage rates, the 30-year fixed rate has been flat the last year. A year ago, it was about 6.75%. Today it’s hovering just over 7%. So buyers are starting to realize and they’re adjusting their expectations that the days of a 5% or even a 4% mortgage rates might be something that doesn’t happen again.
The Changing Delray Beach Real Estate Market
So what does all this mean for the Delray Beach real estate market and surrounding communities?
In a nutshell, everything is now “up and to the right.” The number of listings is up and to the right. MOS is up and to the right. Days on Market (DOMS) is up and to the right. This means we’re in a neutral market. Neither sellers nor buyers are in charge. It’s a negotiating market. It’s a balanced market.
Let’s look at the data. Let me first start off with and barrage you with a handful of charts that are up and to the right. Look at the number of listings. You can see that a year ago it was below 1,650 listings. Today, we’re over 1,950. That’s a significant rise as the percentage goes.
Look at the months of supply. One year ago, it was about 5.6 months, which was what a seller’s market. And now it’s 7.7 months. That is a buyer’s market.
As for the days on market, first look at the one year chart. A year ago is was 60 days. Today it’s about 85. Now, let’s scale back and look at the 3-year chart. It goes back to January 2022 where it was around 30 days. Today, it’s around 85 day – again, up and to the right.
Here are some charts that are not up and to the right, but they do give you a good understanding of what’s happening in the 2025 real estate market.
Delray Beach Real Estate Contrary Charts
One year ago, the sold-to-list ratio was 92%. Now it’s at 90%. That means a property listed at $1 million is selling for 900,000 – or a 10% discount property.
Now, pending sales. This is a leading indicator. These are sales that haven’t closed yet. They’re under contract, and will close 30, 45, 60 days in the future. You can see for most of this year, it was negative. Over the last few months, pending sales are increasing every month starting September.
To sum it all up, we’re in a neutral market, a negotiating market. In the Delray Beach real estate market, no one is in charge and neither seller nor buyers. We now have a market that is more balanced.
Delray Beach Real Estate Condo Market
Take a look at my video down where I spoke about what’s happening. Things like the Structural Integrity Reserve Study (SIRS) must done. Condo HOA’s have must provide board meeting minutes. Their reserves need to be funded starting this year. So, there’s a lot of new laws and a lot of new aspects about buying and selling condos that began the beginning of this year.
We need to obtain all that information from the HOA so we can represent sellers and buyers the right way. As of January 1st, 2025, there’s an additional ¾ page with boxes to check regarding all these items above.
The HOA has it or doesn’t. So, make sure when selling or buying there are details you must understand. Make sure you’re working with a real estate agent who understands exactly what’s happening and who can talk you through these new points.
2025 is going to be a great year for the Delray Beach real estate market. Why? The metrics are lining up well for buyers. Prices are coming down, and there is more inventory so you have a lot more to choose from. And buyers are negotiating and getting better prices on listings. That might not sound good for sellers, but here’s the thing. Last year sales we low. Properties stuck on the market for 60, 100… even 150 days.
Why? Because buyers weren’t ready. They were waiting for the market to change. Buyers were waiting for rates to come down. All that is now stabilizing. So, as a home seller, right now is a great time to get back in the game because pending sales are up.
We’ve said goodbye to 2024, which was one of the worst years for sales in America. That’s all changing. As a home seller, you’re seeing a trend in the of number of sales go up. Prices are moderating. You’re still getting better deals, and there’s a lot of buyers in the Delray Beach real estate market as 2025 gets underway.
So, if I can help you in selling your home or if you’re looking at buying, contact me. Let’s get a cup of coffee… or a kombucha.
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Is this 2.5 year Delray Beach Real Estate Trend FINALLY OVER?! The Delray Beach real estate market is one of the strongest in South Florida. At the same time I’m seeing a change in how the charts are looking. That’s what I show in this video – how things in the Delray Beach real estate market appear to be changing…
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