The real estate market in Northeast Florida is sizzling and shows no signs of slowing down. Earlier this year, Jacksonville earned the No. 1 spot on Trulia’s list of the top 10 real estate markets poised for growth in 2017. Home values, prices and sales have shown some of the strongest numbers since before the economic downturn a few years ago.
Take a look at the latest data from the Northeast Florida Association of Realtors. In the January 2017 monthly report, the Median Sales Price increased more than 6 percent. While prices continued to gain traction, the continued decline in the number of homes available for sale, with inventory levels falling by more than 18 percent, remains one of the biggest challenges in today’s market.
“Home prices continue to post steady gains and are nearly back to pre-recession levels in most of our markets,” said Berkshire Hathaway HomeServices Florida Network Realty Founder, President and CEO Linda Sherrer. “The pace of growth remains strong and, for home pricing, represents an above-average level of appreciation. The shortage of available properties should continue to drive prices higher. There is a significant demand for moderately priced homes that appeal to both first-time buyers and Baby Boomers wishing to downsize.”
Berkshire Hathaway HomeService's statistics are remarkable in the homes priced at $250,000 and under category. The inventory of homes available for sale is down 26 percent with the months’ supply of inventory down to 2.9 months. The time it took to sell a home was only 73 days with a list-to-sell price ratio at nearly 95 percent.
Statistics in higher price points are similarly dramatic. The months’ supply of inventory of homes for sale in the $250,000 to $500,000 price range is 4.5 months with only 85 days on the market to complete the sale. In the luxury home category, homes prices $500,000 and up, the months’ supply is less than 10 months with 114 days on the market or homes selling in less than four months.
Additionally, what the statistics don’t reveal are the number of permits for significant home renovations or rebuilding, particularly at the $500,000 and up price level. This trend is evident throughout Northeast Florida, but particularly noticeable in Northeast Florida’s high growth beaches areas ranging from Atlantic Beach south to St. Augustine Beach.
“With the scarcity of land and available homes, we are seeing more and more people purchasing a home for the land it sits on, tearing it down and building a new, often larger home,” said Broker/Executive Vice President Christy Budnick. “It is astonishing to see the amount of rebuilding going on in our communities.”
With limited inventory, Budnick says the current real estate market is clearly a sellers’ market. With an abundance of buyers and homes selling more quickly than inventory can be replaced in many neighborhoods, it is important for buyers to understand the specific market trends in their areas of interest. Selecting a Realtor who is knowledgeable about the area and can clearly interpret the market data will help the buyer negotiate a competitive offer more likely to be accepted by the seller.
Considering the rising prices and tight inventory challenges in the current market, should homebuyers put off their purchase? Absolutely not!