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This week I bring you up-to-date on real estate sales for 2023. Most analysts agree real estate is on an upturn despite higher mortgage rates and lower inventory. Some sales now coming on market are from persons in the work force that are being called back into the office after working from home. Florida continues to have a higher sales volume from people relocating from the north. However, the demand for vacation homes is down. And one reason inventory is low (lack of new builds). I present information from five articles: Three from Florida Association of Realtors, one from the National Association of Realtors and one from Black Diamond resident/Mortgage person Nathan Path.
I also include stats from Citrus County (Ridge area) single family home sales for the last 180 days and the current homes on the market.
The Fall in Home Prices May Already Be Over
Sellers stopped selling and some buyers stopped buying, but demand still outweighs supply. The result: Declining sales prices may have bottomed out in early summer.
Link to full article:The Fall in Home Prices May Already Be Over | Florida Realtors
NAR: Pending Sales Up, Second Month in a Row
Pending home sales regional breakdown: The Northeast
PHSI shrank 5.8% from last month to 63.2, a decrease of 20.2%
from July 2022. The Midwest index fell 0.4% to 77.5 in July, down
16.0% from one year ago. The South PHSI rose 2.0% to 95.3 in July, though it was down 10.9% from the prior year. The West index improved 6.2% in July to 61.3, dropping 12.8% from July 2022. Interestingly, the West region experienced a meaningful price decline in the past year and buyers are quickly returning as a result.
Link to full article:NAR- Pending Sales Up, Second Month in a Row | Florida Realtors
Fewer Apply for Mortgages Due to Higher Costs
MBA: Home loan applications fell 2.1% last week to the lowest level in 28 years, as low housing inventory and higher mortgage rates sidelined would-be buyers.
LOS ANGELES (AP) – U.S. home loan applications are the lowest in decades as evidence mount that rising mortgage rates and home prices are shutting out many aspiring homeowners.
An index that tracks mortgage application volume shows applications for loans to buy a home fell last week to the lowest level in 28 years, according to the Mortgage Bankers Association. The MBA’s home loan application index shows that home purchase loans fell 2.1% last week from the prior week to a seasonally adjusted reading of 141.9. That’s down about 28% from a year earlier and represents the lowest level for the index since April 1995.
Link to full article:Fewer Apply for Mortgages Due to Higher Costs | Florida Realtors
Why is Inventory low?
BD resident/mortgage person Nathan Path suggests inventory is low because new home builds are down.
Link to full article from his current email:Inventory conditions
Vacation Home Demand Close to Seven-Year Low
Demand for second homes is also down (19%) year-to-year. Mortgage-rate locks for second homes, which is also bigger than the 14% decline for primary homes.The pandemic may have also influenced the current market.
Vacation home mortgage locks skyrocketed during the pandemic, hitting a peak of 88.5% above pre-pandemic levels in October 2020. Affluent Americans jumped at the chance to snap up second homes with record-low mortgage rates during a time when many of them could work remotely from vacation towns. Demand for primary homes jumped during that time, too, but
the increase was much more modest, reaching a peak of 16% above pre-pandemic levels in late 2020.
Variety of reasons for vacation home drop:
It’s more expensive to buy a second home. The typical home in a seasonal town – where many second homes are located – sells for $564,000, up 5% from a year earlier, though it’s comparable to non-seasonal towns ($421,000),
also up 5%. However, mortgage rates for second homes are also typically higher. In addition, the federal government increased second homes’ loan fees in 2022, which sometimes adds tens of thousands of dollars to the cost.
Many workers are returning to the office. The allure of second homes has diminished as many companies tighten employees’ ability to work remotely.
Short-term rentals are less attractive. The “rent it out on Airbnb” options may be less attractive than it once was. Some U.S. cities created new regulations, and the maturing short-term rental industry has faced some internal problems
during its growth. The long-term rental market is cooling. Buying a
vacation home to rent out long term is less attractive, too.
Link to full article:Vacation Home Demand Close to Seven-Year Low | Florida Realtors
CITRUS COUNTY RIDGE AREA:
Black Diamond:
sold:bd sold
for sale:BD sale
Pine Ridge:
for sale:PR sale
Citrus Hills Terra Vista:
sold:tv sold
for sale:tv sale
