In July’s “How’s the Delray Beach Real Estate Market update I have a handful of charts to share.
I’ll show the number of listings are plateauing. Talk about median sales prices are going up. I’ll review the falling number of pending listings… as well as the number of active listing price drops in the market today.
Plus, you’ll get you two bonus charts: one about affordability and how it applies to Delray Beach, as well as how two different sellers got two different results.
Delray Beach Real Estate Current Charts
The first chart is active listings. I have two of them. Let’s look at the 3-year chart. It goes back to 2021. The overall trend over the last three years has been up.
But if you look at the second chart, this is the one over the last year.
You can see that starting this time last year, August, inventory raced higher. It went up about 83%. That’s a massive increase in inventory in a short period of time. The market went from a sellers to a buyer’s market.
Then inventory peaked in March of this year, and since it’s been a handful of months where it’s plateauing and falling a little bit.
So, are we still in a buyer’s market or have we transitioned into the seller’s market? A lot of data says we’re right in between. It’s a balanced market today, but the active listings is clearly something we want to look at as a leading indicator moving forward.
It’s critical Delray Beach real estate owners stay current and updates with our market data.
Before I talk about median sales price, I want to remind you: if you’re not following along on my weekly e-letter that comes out every Wednesday, sign up here.
Now, let’s take a look at the median sales price in this comprehensive chart. Hone your eyeballs on the median sales price. You can see that this July versus July 2023, the median sales price is up just over 10%, and on a year over year basis, it’s up 11.5%.
So, although you’ll see a lot of data that doesn’t look positive for the real estate market – listings, pending listings, all these things that are going down – the median sales price is still strong and improving.
Next is my favorite leading indicator – pending listings. What does that mean? It’s listings that have contracts on them, but not under contract. They’re now in escrow. They’re pending, but they’re not closing for another 10, 20, 30 days.
This is a leading indicator because it’s not closed data. It’s data that’s going to happen in the future.
Take a look at the information that comes from this. You can see that July of this year versus July last year, it went from 293 pending listings a year ago to 233. That’s a 20% drop in pending listings. That’s not good.
Pending listings is an important leading indicator to show is the market strengthening or softening with sales volume.
Now, this final chart is about the average price drop of active listings. You mean they price it up here and it’s active and they keep dropping the price? Take a look at this.
The average price drop of active listings in the Delray Beach real estate market right now is 8.58%. The median drop is 7.14%. That means that sellers have been pricing it too high and no one’s buying, so it’s the Dutch auction. They just keep lowering the price. That’s not good.
Speaking of things not being good – affordability is bad. Look at these next two charts, which are my bonus material. The data is a couple months old, but I checked on the NAR website. It’s still the same.
The first chart shows the affordability index. The higher the number means the more people can afford properties.
Over the last four years, it has been destroyed. Why? Higher prices. Higher inflation. Higher mortgage rates.
Why is that happening? Take a look at this chart.
This the percentage of income you need to buy a median price house in America. Four years ago, you needed about 28% to 30% of your income to buy. Today it’s at 43%.
That means that people need to either make a lot more money to buy a home or prices have got to come down. That’s a fact of today’s real estate market.
Delray Beach Real Estate Home Sellers – Two Stories
Now, for bonus number two, sit back, relax. It’s time for me to tell you a story about the results of two separate sellers that happened to me in the last 60 days.
Seller number one asked me to do a competitive market analysis. I presented him with a thorough report where his price came in at about $690k. He was shocked, surprised. He thought his homes are worth $950k. That is a 34% increase from what the actual market is.
What has happened in the last 60 days? Nothing. His homes are still on the market. He’s probably thinking he should’ve listened or brought his price down so they can sell.
Story number two is a seller who said, “John, give me a competitive market analysis (CMA). I want to sell. I don’t want to worry about what’s been going on in the market. I need the current price right now. Find me as many buyers as you can.”
I did the same CMA, presented him with a complete report on what’s the current market. I focused on his condominium building.
We priced it at the price I presented him as it made complete sense.
Within four day we had two offers, and we were under contract in less than a week.
Whether you’re seller #1 or seller #2, today’s world is all about pricing your property right. If you miss pricing it, you’re going to be a part of the Delray beach real estate market charts and following a Dutch auction. You’re going to be following the market down.
Or like many sellers are now doing, they’re just canceling their listing agreement and they’re taking the property off the market.
Do you want to sell your home or not? That’s the question.
NAR Settlement and the Delray Beach Real Estate Market Start August 17…
I’ll end it with this. This is the largest story in real estate’s history. Mark your calendar. August 17th. That’s when the way we do business with sellers and buyers completely changes. So if you’re a home seller or buyer in the Delray Beach real estate area, this applies to you.
I’ve written a half-dozen essay on this idea that are on my website. You can read this, or this, or this to get caught up.
I’ve talked about it in my past videos. It’s relationship based.
Like we do with sellers when we get a listing, we sign a listing contract. Well, starting August 17th, when we work with buyers, we’re going to get a buyer representation agreement on expectations of what my services are, and what compensation looks like.
It’s fully disclosed. Fully transparent.
If you’re thinking of selling, call me. I’d love to meet with you. We can create a competitive market analysis. Then we’ll price your property for today’s market so you can sell.
And if you’re thinking about buying, call me. Let’s get some coffee. Give me 5 minutes to explain these industry changes that are now policy. It’s important you know your options – and I’m happy to explain it to you.
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Delray Beach Real Estate – Your JULY 2024 MARKET UPDATE Just when you read that Delray Beach real estate supply is surging, it changed direction. Its been falling since March. At the same time, median home prices in the Delray Beach real estate market continue to rise. Confused? I simplify it all in this video, plus share a couple bonus ideas…
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