Dear reader, if you missed last weeks’ essay, today I continue with the same theme – one that should make home buyers smile.
This one is about extreme’s. Like a rubber band stretched too far… then returns to its normal form.
As you know, I’ve been watching our local inventory like a hawk. After 24 months of inventory dropping over 66%, this is the 2nd week numbers are rising. As of this writing, the number of available properties is 15,133 – first week above 15k in over 5 months (See below). This gives home buyers some happy news that’ll I’ll be sharing with my weekly eLetter readers.
I’m also seeing Days on Market (DOM) linger. After hovering near 30 days, some high quality beach condos are now 32, 98 and 105 DOM. At the same time, these owners are holding on to their prices, which may be reflective of “yesterdays” market.
Sellers who don’t think things will change may want to read this Florida Realtors essay discussing price drop expectations. As for home buyers, you, too, need to be plugged into this fast changing market data.
According to an essay in Fox Business, in the Mortgage Monitor Report by Black Knight, homeowners took out a record $1.2 trillion in cash-out refi’s in 2021 – the most since 2005 – and tapped $275 billion in home equity. With rising interest rates, that game is over.
Speaking of rates, how often do they rise over 25% in 30 days? Or 69% in the last year? These are extreme’s that will find their way back to normal levels.
I’m not saying mortgage rates will be falling anytime soon – sorry home buyers. I do believe we may see them rise from the current 5.3% to near 6% by the end of this year. It’s almost baked in with The Fed committed to staving off inflation.
But I am saying the worst of this parabolic rise in rates is over and the increases will be slowing. Just take a look at how fast rates have risen this year…
A New Dawn Rises for Home Buyers
The rubber band is showing cracks. Is a snapping point here?
Home buyers are exhausted. Rates have them scared. Headlines have a new tone to them. These are signs of a real estate market showing its moment of change.
For home owners who’ve been on the fence about selling, your time is running thin. To sell your home fast, you must act now. And for burnt out home buyers, put your head back in the game now. As we’ve seen time and time again, when the market changes… it may be swift.
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Your Weekly Inventory Update: 25 months ago there were over 54,000 properties available for sale in S. Florida. Last week there were 14,947 available.
This morning the number stands at 15,133. (I hope you’re following this data point with me each week – it could be the most important data point we’ll watch together this year).
