Lake, Sumter and Marion counties to see housing markets stay warm
The real estate market in Lake, Sumter and Marion counties remains hot with strong demand and historically low inventories based on information from the Realtors® Association.
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Some local housing analysts point out that since midsummer the equation of demand and supply of housing has eased somewhat. However, market figures continue to suggest there are more buyers than sellers with home prices continuing to rise.
In August, the number of new registrations was 2,128, compared to 1,744 in January. However, compared to the average of the last 5 years, the number of registrations in August is only 110 units more, which is somewhat surprising given the pandemic period of 2020 without vaccination.
Total active listings for the region were 2,756 with August sales of 1,733 units. Total active listings in January were significantly higher at 3,526. Based on these numbers, there was a net of 628 additional homes on the market for every 1,733 units sold.
These numbers explain why there were only 2 months of available housing stock in August for Lake, Sumter and Marion counties. In June, the home inventory was a month, but don’t let a month-long improvement get you excited when it could just be a rounding error.
To put these housing stocks into perspective, the local real estate market had a 13-month supply in 2011 as the rebound from the crash began. Two months of home inventory indicates that homes are selling quickly, and better-off buyers who typically have cash or very strong credit and a down payment, get most homes. Fringe buyers of affordable homes will find it difficult to find a home in today’s environment.
The best indicator of the local real estate market is probably the average sale price. In January 2021, the average selling price of a home in Lake, Sumter and Marion counties was $ 261,021 and by August the average selling price had jumped to $ 321,435 or 23.1%. This is a huge increase and suggests that many homes have multiple offers and are selling for above asking price.
What do these numbers actually mean to the seller and buyer of the home?
If you are selling a home, now is a good time, unless you are looking for a replacement home in exchange. Due to the price articulation over the past few years, a different home may not compare to your old home. Before you sell, know what you can buy and be prepared to act quickly. Don’t expect months on the market from when you put your home up for sale until moving day.
If you are a home buyer, you need to get your financing tight and be ready to move. Whether you are paying cash or financing, be prepared to sign offers and contracts quickly, as chances are the house you are looking at today will cost more in the coming months. Cash and strong credit are king.
Finally, August is not Florida home sales season. It begins later in the fall when winter residents begin to return to Florida. If the pandemic subsides in the fall, expect the buying season to be one of the strongest in years, as pent-up demand is significant. If there is an increase in winter residents, prices could rise faster than in the past 8 months, as many of these buyers are going down with cash on hand.
Unlike the mid-2000s, this is not a real estate bubble sparked by speculation and easy loans. This has the makings of a real estate boom triggered by real demand and very low inventories. While this is good for many, working families in need of affordable housing will have a hard time finding housing. Don’t expect these local real estate markets to settle down anytime soon with low inventories and high demand.
Don Magruder is the CEO of Ro-Mac Lumber & Supply, Inc., and he is also the host of “Around the House” which can be seen on AroundtheHouse.TV.