Central Florida Housing Market Mid-Year Update: Opportunities and Preparations for Future Investments

*Source: Housingwire.com

As we reach the midpoint of 2024, the Central Florida housing market, much like the national landscape, is experiencing significant changes in inventory, pricing, and demand dynamics. Here's a detailed look at the current trends and what they mean for potential real estate investments in our region.

Growing Inventory: A Healthier Market

Nationally, active inventory has increased significantly compared to last year, providing much-needed relief to the housing market. In March 2022, there were only 240,000 active single-family homes available for sale across the country. Today, that number has risen to 652,573, marking a substantial improvement from the lows of 2022. This increase in available homes has brought the market to a healthier state, though it still falls short of pre-pandemic levels.

Weekly Inventory Highlights:

• June 29-July 5, 2024: Inventory rose from 645,770 to 652,573.
• Same week last year: Inventory fell from 466,534 to 466,001.
• All-time low: 240,497 in 2022.
• Inventory peak for 2024: 652,573.

For context, active listings during this week in 2015 were 1,183,882. While we are still below those levels, the trend is moving in the right direction.

New Listings: Seasonal Peak and Trends

We are currently in the seasonal peak period for new listings.

Recent New Listings Data:

• 2024: 71,181
• 2023: 58,289
• 2022: 89,221

Price Cuts: Adjusting to Market Conditions

Price reductions are a natural part of the housing market, with about one-third of homes typically experiencing a price cut in an average year. This year, the percentage of price cuts is higher, reflecting the ongoing adjustments due to elevated mortgage rates and varying inventory levels across different regions.

Weekly Price-Cut Percentages:

• 2024: 38%
• 2023: 33%
• 2022: 32%

Pending Sales: Steady Demand Amid High Rates

Pending sales data, which reflects real-time demand, shows a slight year-over-year growth, despite higher mortgage rates. This indicates a stable interest from buyers, particularly those who are also selling their homes.

Pending Sales Comparison:

• 2024: 381,057
• 2023: 381,036
• 2022: 420,816

Mortgage Rates and Yield: Impact on the Market

Recent fluctuations in the 10-year yield and mortgage rates have influenced the housing market dynamics. Despite these changes, mortgage rate spreads have improved compared to the worst levels seen in 2023.

Purchase Applications: Fluctuations and Opportunities

Purchase application data has shown volatility, influenced by weekly mortgage rate movements. Since the decline in mortgage rates started in November 2023, we've seen a mixed pattern of positive and negative trends in application data.

Year-to-Date Purchase Application Data for 2024:

• Positive weeks: 9
• Negative weeks: 14
• Flat weeks: 2

Looking Ahead: Preparing for Future Investments

As we look forward to the second half of 2024, it is crucial for potential investors in the Central Florida market to stay informed and prepared. Here are some key takeaways and recommendations:

1. Monitor Inventory Levels: The increasing inventory provides more options for buyers and can lead to better negotiating opportunities.
2. Stay Updated on Mortgage Rates: Keep an eye on mortgage rate trends, as even small fluctuations can significantly impact affordability and demand.
3. Consider Timing: The market is expected to experience seasonal shifts, so timing your investments strategically could yield better returns.
4. Prepare for Price Adjustments: Be aware of potential price cuts and use them to your advantage when negotiating deals.
5.  

For any specific inquiries or personalized advice, feel free to reach out.

*Source: Housingwire.com