The Lamacchia Realty South Florida Housing Report presents overall home sale statistics and highlights the average sale prices for single families, condominiums/townhomes in Broward County, Miami-Dade County, and Palm Beach County for January 2023 compared to January 2022. It also looks at other metrics like New Listings and New Pending Sales as they are often the best indicators for predicting future trends in the market.
In January of 2023, Broward County single-family and condo/townhome closed sales, new listings, and pending sales decreased. The average price increased for condos and townhomes and decreased for single-family homes.
In January of 2023, Miami-Dade single families and condos/townhomes saw decreases in all categories besides average price, where we saw a small increase for condos and townhomes.
Palm Beach County
In January of 2023, Palm Beach County single families and condos/townhomes saw a decrease in all categories, besides a slight increase in average price for condos and townhomes.
- The number of homes sold is down well over 30% in Broward, Miami-Dade, and Palm Beach counties in both the single-family and condo/townhome categories when compared January 2022.
- This decrease in sales can mostly be attributed to increased mortgage rates which will remain a critical factor throughout the year as the market ebbs and flows through this shift. Increased mortgage rates lower buyer affordability causing many buyers to adjust their budgets and/or expectations and also knocks some buyers out of the market completely. Remember, not only has the cost of borrowing increased, but so has everything else with inflation levels still straining consumer budgets.
- With this in mind, we may see closed sales impacted even more in South Florida given it’s typically a market for 2nd homeowners and investment properties. Given the variables in the economy currently, there isn’t the same amount of wealth and disposable income as two years ago for these types of purchases.
- However, rates dropped and held steady in the low 6s through the month of January, even dropping as low as 5.99%, causing a short-lived “rush” in the market as buyers jumped on these lower rates. Pendings would have been even lower this month if not for this “rush”. But, this market is ever-evolving and now rates have jumped up again in February to the high 6s so we will see next month how this impacts certain market indicators.
- For the serious buyers who remain in the market, this lessening of demand will provide a much needed reprieve from the frenzied market of two years ago with intense bidding wars and wildly inflated prices. Inventory is up year over year which should result in a lessening of competition and provides buyers with more options and more time to complete the home buying process.
- The number of new listings is also down when compared to January 2022. Again, with mortgage rates over 6%, many sellers who finance their homes are hesitant to list their current home with a 2-3% mortgage rate as they would then have to buy and finance at these current, higher rates.
Even though new listings are down, overall inventory as a whole is up. This is evidence of that decrease in buyer demand in the housing market. The number of homes receiving an accepted offer is less than the new ones being listed (despite fewer homes being listed than last year).
Whether you are a buyer or a seller, understanding what mortgage options, like mortgage buydowns or assumptions, are available will be critical to being successful in this changing market!
- Across the three counties in this report, prices increased or saw a slight decrease year over year. Demand is lessening and although supply is up and rising, the level is still not enough to cause prices to start dropping dramatically. However, the rate at which prices have been increasing will slow, as evidenced by the average price data we saw this month. The trend is expected to continue throughout the year.
- The market for condos and townhomes saw many of the same trends as single-family homes in January with sales down significantly and prices slightly increased. Since the horrific Surfside Collapse in 2021, there have been several new regulations to contend with as well as increased expenses for condo owners. As such, we may see an influx of non-owner occupied condo listings in the spring as owners will try to offload their units rather than deal with the new changes and fees.
*Data provided by Florida Realtors® SunStats