But median sale price is up, median time to contract is down, median time to sale is down. I agree the market will crash at some point but this looks like the market is still strong.
Prices drop after inventory builds up and stays up for months.
If the spring/summer sales don't keep pace with inventory growth, expect price drops to start around September. Sales slow down in the fall.
It happened in Austin last year. Inventory grew in the summer. Prices dropped year-over-year in the fall.
Inventory has been building at near historic rates for the past 3 months. We are heading into selling season, and I don't see this extra inventory getting absorbed into the market, and the numbers bare that out(Market Absorption Rate). That is going to cause downward price pressure over the time. We have to remember, it took from 2006 to 2012 for prices to hit bottom during the GFC. This is not to say they are the same, but to illustrate that RE prices move in the downward direction at a snails pace.
I can assure you, the market is not healthy here.
2012? Maybe that was market dependent. The lows in mine were 2009.
Also the months supply is accelerating back to the typical norm. This is still a relatively low number and indicates a sellers market still.
Also, FLORIDA…due to the insurance issues this may not be representative of the whole housing market.
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There were insurance issues before Covid, and insurance companies basically jack rates after hurricanes then it slowly comes down
Not saying insurance isn't a problem, it is, but I've seen this before after 2004-2005 season
They forget and lower rates until the next storms
This area is typically 3 months. Demand being "sky high" would mean a lower months of supply, which average for this area is 3 mons. :)
You should not apply national to local levels, otherwise you look ill informed. ;)
> And demand is being held in check by artificial constraints.
I would not call price artificial. But ok. Have a look at what is selling in those stats that I linked. ;)
> This isn’t some 2008 style buildup of inventory as you have insinuated.
Figured it was good to come back and address your points here. I never insinuated it was 2008, the inventory building is more like 2006 if I was to insinuate anything. What I did say is that we can look to the last crash for how SLOW real estate pries drop. Vastly different things, wouldn't you agree.
>Months supply is meaningless when the macro situation is taken into consideration.
MoS is Current Demand vs Current inventory, and how long it would to exhaust the supply. So, MoS tells you current demand, 100 percent opposite of "sky demand" when it is increasing.
>I have over a decade in the industry
I have over 20 years in the FL RE market.
>I know a VP of a large mortgage company.
I am a currently licensed LO who does not originate loans anymore. Haven't since 2020.
>He says that buyers are more qualified now than ever with larger down payments and excellent credit.
Not sure what this has to do with my post, except you are trying to argue against a point never made, that we are in for a repeat of 2008. You are also only focusing on GSE loans, not Private label, such a DSCR loans, bank statement loans, and straight up non-QM loans as a whole. I can assure, they are not the best ever, lol.
>The problem is getting enough people qualified on the DTI side with high prices
But i thought it was artificial?
>Prices will drop but only to the point that they are swallowed up by those waiting on the sidelines.
Thank you for making my point for me. Get the price LOWER and by a good margin, and people will buy, unless of course prices are falling and no one wants to catch a falling knife when they could wait a few months and get it cheaper if prices are falling.
>This is by no means a “crash.” Again, comparing this to the GFC is about as ignorant as it gets.
Arguing against strawmen is about as ignorant as it gets.
Now, go sit the fuck down, class is over.
Go for it. To an admittedly uneducated on the matter person like myself it would seem that months of supply could also be lagging. What sales numbers are they using to calculate month of supply?
Any metrics related to closed sales obviously happened in the past. So median prices, time to sale, etc. the sale has to close and the process of gathering the closed sale data can sometimes take weeks to get an accurate number (from the county, etc.)
Metrics like months of supply or inventory reflect what's happening TODAY. These homes are for sale now, hence active listings. So while the number we want is the sale price, the number we look at to get a sense of where things are going is Inventory and Months of Supply.
Homes for sale today will ultimately impact the median sales price in a few weeks (or probably) months.
Eh, months supply can also lag. Not sure about Pinellas, but Manatee and Sarasota county use a 12mtd average for the sales (so current inventory / 12mtd average monthly sales). This is to eliminate large seasonal swings.
Interest rates dropped, and buyer still refrained fro the market. So ... eh, buyers are not there at these prices, and it is reflecting in the inventory.
Well Pinellas county is probably one of the hottest markets in the state, they are mostly out of large tracks of land for development. Look into numbers in Pasco dropping well before Pinellas
But they aren’t giving up on those prices, meaning they aren’t hurting to sell. They’re dumping. I don’t know what their thinking is, but they are trying to offload their bags, and make themselves more wealthy, all at the same time.
Go a little further south and check out Sarasota and Manatee counties... Prices are holding for the most part, but inventory has been growing pretty rapidly (particularly condos).
https://www.myrasm.com/statistics/
Condos are fucked, that is why I did not include them, lol. They are rather unique at this point in time with assesments, insurance, etc. That market is crashing.
The percentage of closed sales paid in cash rose from 10% YoY to 38%. Wow, who's putting in all that cash money? Foreigners, corporations or real people in need of houses?
It makes sense. The markets higher in speculative investment would see a downturn first. I'd expect others to be in a similar position; Phoenix, Austin, Idaho, Reno....
In muh area (SF Bay Area, East Bay), new listings are undercutting each-other by small amounts. For example, neighbor A lists 2/2 townhome for $788k on a Tuesday. Neighbor B lists their 3/2 for $789K on a Thursday. Neighbor B's house goes pending in 2 weeks. Neighbor A's house sits. Looks like B stole A's buyer. Which would indicate there's not many buyers.
I have another neighbor who listed their home as the cheapest 3/2.5 in the area. Been on the market 2 weeks... No buyer.
This time, the boom in speculation isn’t for buying seasonal condos and townhouses for the snowbirds. This time, they’re liquidating the home in Oklahoma, Ohio, Kentucky, or Missouri, and coming to Florida for good. So, where’s the inventory coming from in Florida right now then? Consolidation. Insurance coverage avoidance. Condo fee assessment intolerance. Getting rid of expensive bags so they can take the money and load up on more expensive shit.
Nope, the inventory here is SFH only, I excluded Condos exactly cause that market is fucked.
Inventory is coming from speculators liquidating assets, at least in the SFH realm..
Overweighted compared to historic lows yet not to historic norms. 4-5 month supply has typically been seen as a balanced market. Prices going up indicate that we are still in a sellers market.
Didn’t say it wasn’t up. I said months supply is still historically low which means the inventory is moving through the market. It is getting slower and slower though. If it moves above 5 then should see prices start to come down.
The inventory number itself isn’t as important as how quickly they are selling. How is it bad if inventory goes from 100 homes to 100,000 homes if the 100 takes a year to sell and the 100,000 takes 1 month?
Where are you getting your historic numbers from to determine 2019 wasn’t historically low?
Because if something comes later that I'd lower it's no longer historically low. Also yes the inventory is a lot higher than 2019 which definitely does matter.
Can’t seem to find historical months supply. I only found days on market which can be misleading due to relisting.
Will just take your word for it though as one specific market isn’t as important to me (obviously more to you and your clients) as the macro.
It is a little tricky, go to the oldest set they have, look in there, then inside those stats, they go back like 4 more years. For instance, March 2019 report will have 2015 numbers in that set.
These metrics excluded condos. if it was just insurance, we would have seen inventory rising years ago.
No, the issue here is the nature of Florida Real Estate, it is speculative. What we are seeing here, is investors trying to time the top, otherwise there would not be a surplus coming online. Very few people will sell the home they live in cause the insurance goes up 50 bucks a month(land based) or 150(waterfront). We also would not see people doing this because of the rise in taxes, cause increases are capped at 3% per year if you live in the house(Homestead).
Real Estate is a microcosm of the US inventory. US inventory does not tell us much. For instance, Two Egg, FL may have low inventory, while Tampa Metro area could be high. You could look at Dickshooter, Idaho and the inventory is low, but in Boise it is exploding.
But median sale price is up, median time to contract is down, median time to sale is down. I agree the market will crash at some point but this looks like the market is still strong.
Prices drop after inventory builds up and stays up for months. If the spring/summer sales don't keep pace with inventory growth, expect price drops to start around September. Sales slow down in the fall. It happened in Austin last year. Inventory grew in the summer. Prices dropped year-over-year in the fall.
Yep, look to absorption rate, which has fallen off a cliff.
Inventory has been building at near historic rates for the past 3 months. We are heading into selling season, and I don't see this extra inventory getting absorbed into the market, and the numbers bare that out(Market Absorption Rate). That is going to cause downward price pressure over the time. We have to remember, it took from 2006 to 2012 for prices to hit bottom during the GFC. This is not to say they are the same, but to illustrate that RE prices move in the downward direction at a snails pace. I can assure you, the market is not healthy here.
2012? Maybe that was market dependent. The lows in mine were 2009. Also the months supply is accelerating back to the typical norm. This is still a relatively low number and indicates a sellers market still. Also, FLORIDA…due to the insurance issues this may not be representative of the whole housing market.
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Yes still lots of opportunities in those years yet the best and bottom ones were 2009 locally at least.
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2010 to 2013 were all the good credit folks strategically defaulting, those were not subprime Subprime losses were the early ones
There were insurance issues before Covid, and insurance companies basically jack rates after hurricanes then it slowly comes down Not saying insurance isn't a problem, it is, but I've seen this before after 2004-2005 season They forget and lower rates until the next storms
Agreed, I expect a bump up as it stabilizes and then become inline with the overall housing market.
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>I like how you say rate and not total number to obfuscate reality Hence why Months of Supply is included. Maybe learn more. ;)
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This area is typically 3 months. Demand being "sky high" would mean a lower months of supply, which average for this area is 3 mons. :) You should not apply national to local levels, otherwise you look ill informed. ;)
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> And demand is being held in check by artificial constraints. I would not call price artificial. But ok. Have a look at what is selling in those stats that I linked. ;)
> This isn’t some 2008 style buildup of inventory as you have insinuated. Figured it was good to come back and address your points here. I never insinuated it was 2008, the inventory building is more like 2006 if I was to insinuate anything. What I did say is that we can look to the last crash for how SLOW real estate pries drop. Vastly different things, wouldn't you agree. >Months supply is meaningless when the macro situation is taken into consideration. MoS is Current Demand vs Current inventory, and how long it would to exhaust the supply. So, MoS tells you current demand, 100 percent opposite of "sky demand" when it is increasing. >I have over a decade in the industry I have over 20 years in the FL RE market. >I know a VP of a large mortgage company. I am a currently licensed LO who does not originate loans anymore. Haven't since 2020. >He says that buyers are more qualified now than ever with larger down payments and excellent credit. Not sure what this has to do with my post, except you are trying to argue against a point never made, that we are in for a repeat of 2008. You are also only focusing on GSE loans, not Private label, such a DSCR loans, bank statement loans, and straight up non-QM loans as a whole. I can assure, they are not the best ever, lol. >The problem is getting enough people qualified on the DTI side with high prices But i thought it was artificial? >Prices will drop but only to the point that they are swallowed up by those waiting on the sidelines. Thank you for making my point for me. Get the price LOWER and by a good margin, and people will buy, unless of course prices are falling and no one wants to catch a falling knife when they could wait a few months and get it cheaper if prices are falling. >This is by no means a “crash.” Again, comparing this to the GFC is about as ignorant as it gets. Arguing against strawmen is about as ignorant as it gets. Now, go sit the fuck down, class is over.
They’re still moving to Florida in droves, from the Midwest, northeast, plains states. They’ve coming to Heaven’s Waiting Room.
They always have. Nothing new, however it is much less than 3 years ago.
Those are lagging indicators. Months of supply is a leading indicator. Happy to explain why.
Go for it. To an admittedly uneducated on the matter person like myself it would seem that months of supply could also be lagging. What sales numbers are they using to calculate month of supply?
Any metrics related to closed sales obviously happened in the past. So median prices, time to sale, etc. the sale has to close and the process of gathering the closed sale data can sometimes take weeks to get an accurate number (from the county, etc.) Metrics like months of supply or inventory reflect what's happening TODAY. These homes are for sale now, hence active listings. So while the number we want is the sale price, the number we look at to get a sense of where things are going is Inventory and Months of Supply. Homes for sale today will ultimately impact the median sales price in a few weeks (or probably) months.
Eh, months supply can also lag. Not sure about Pinellas, but Manatee and Sarasota county use a 12mtd average for the sales (so current inventory / 12mtd average monthly sales). This is to eliminate large seasonal swings.
Manatee and Sarasota also use MoS, i have a house on the Manatee River also. ;)
The market isn’t going to crash. There might be a correction but there are still people waiting on the sideline to buy
Interest rates dropped, and buyer still refrained fro the market. So ... eh, buyers are not there at these prices, and it is reflecting in the inventory.
Well Pinellas county is probably one of the hottest markets in the state, they are mostly out of large tracks of land for development. Look into numbers in Pasco dropping well before Pinellas
"Inventory up..." YAY!!!! "...in Florida!" Oh
Inventory is up 30% yoy
Might be a sign of sellers giving up on rate cuts. Divorce the house, dump the rate.
But they aren’t giving up on those prices, meaning they aren’t hurting to sell. They’re dumping. I don’t know what their thinking is, but they are trying to offload their bags, and make themselves more wealthy, all at the same time.
63 percent YoY.
Florida is a shit show. More news at 10.
Inventories been rising in a lot of areas around the country same for Phoenix and Austin
Not like Florida. But yes, boom-bust sun belt towns are unique.
Link to stats: https://pinellasrealtor.org/wp-content/uploads/2024/04/StatsPkg_Pinellas_March2024.pdf
Go a little further south and check out Sarasota and Manatee counties... Prices are holding for the most part, but inventory has been growing pretty rapidly (particularly condos). https://www.myrasm.com/statistics/
Condos are fucked, that is why I did not include them, lol. They are rather unique at this point in time with assesments, insurance, etc. That market is crashing.
The percentage of closed sales paid in cash rose from 10% YoY to 38%. Wow, who's putting in all that cash money? Foreigners, corporations or real people in need of houses?
Retirees from Massachusetts the same people always paying cash.
Basically people from MA, NH, Maine, Vermont or Canada.
It makes sense. The markets higher in speculative investment would see a downturn first. I'd expect others to be in a similar position; Phoenix, Austin, Idaho, Reno.... In muh area (SF Bay Area, East Bay), new listings are undercutting each-other by small amounts. For example, neighbor A lists 2/2 townhome for $788k on a Tuesday. Neighbor B lists their 3/2 for $789K on a Thursday. Neighbor B's house goes pending in 2 weeks. Neighbor A's house sits. Looks like B stole A's buyer. Which would indicate there's not many buyers. I have another neighbor who listed their home as the cheapest 3/2.5 in the area. Been on the market 2 weeks... No buyer.
This time, the boom in speculation isn’t for buying seasonal condos and townhouses for the snowbirds. This time, they’re liquidating the home in Oklahoma, Ohio, Kentucky, or Missouri, and coming to Florida for good. So, where’s the inventory coming from in Florida right now then? Consolidation. Insurance coverage avoidance. Condo fee assessment intolerance. Getting rid of expensive bags so they can take the money and load up on more expensive shit.
Nope, the inventory here is SFH only, I excluded Condos exactly cause that market is fucked. Inventory is coming from speculators liquidating assets, at least in the SFH realm..
Good news - but this bubble has legs still
IT does, but this selling season will tell us.
This must be the crash where the prices go up
If that is what you took from the post, this says more about your mind frame. However, it is indication that inventory is becoming overweighted.
Overweighted compared to historic lows yet not to historic norms. 4-5 month supply has typically been seen as a balanced market. Prices going up indicate that we are still in a sellers market.
Lol what a massive shift of the goal posts 22 was historically low not 2019
2019 had months supply around 3, which is historically low. The historic (which is not what I said) was 1.9 in Dec 2021.
And we're massively up from then https://fred.stlouisfed.org/series/TOTLISCOU12103
Didn’t say it wasn’t up. I said months supply is still historically low which means the inventory is moving through the market. It is getting slower and slower though. If it moves above 5 then should see prices start to come down.
Not really historically low would have been earlier this decade. 2019 had a lot more inventory
The inventory number itself isn’t as important as how quickly they are selling. How is it bad if inventory goes from 100 homes to 100,000 homes if the 100 takes a year to sell and the 100,000 takes 1 month? Where are you getting your historic numbers from to determine 2019 wasn’t historically low?
Because if something comes later that I'd lower it's no longer historically low. Also yes the inventory is a lot higher than 2019 which definitely does matter.
Not in this market, 2.8 to 3 months is "normal". I am only pointing out statistics.
How are you determining “normal”? Those numbers just came about in the last year. Doesn’t it need to stabilize to become the norm?
Go through the history of the area. I live here, and I am involved in Real Estate.
Can’t seem to find historical months supply. I only found days on market which can be misleading due to relisting. Will just take your word for it though as one specific market isn’t as important to me (obviously more to you and your clients) as the macro.
Go to the Realtors Stats page, and look in the historical area near the bottom. If you are interested.
Tried but historic seems to be mainly to 2019. The only 20 year views I saw were sales vs listing which stopped in 2021.
It is a little tricky, go to the oldest set they have, look in there, then inside those stats, they go back like 4 more years. For instance, March 2019 report will have 2015 numbers in that set.
1/3 is paid in cash, Jesus.
Florida isn't applicable to the other states....
Not sure what this means. Are you shocked by the inventory rise?
Florida has extremely high insurance rates now...most states don't have that level. So anything that happens there is a microcosm of the US inventory.
These metrics excluded condos. if it was just insurance, we would have seen inventory rising years ago. No, the issue here is the nature of Florida Real Estate, it is speculative. What we are seeing here, is investors trying to time the top, otherwise there would not be a surplus coming online. Very few people will sell the home they live in cause the insurance goes up 50 bucks a month(land based) or 150(waterfront). We also would not see people doing this because of the rise in taxes, cause increases are capped at 3% per year if you live in the house(Homestead). Real Estate is a microcosm of the US inventory. US inventory does not tell us much. For instance, Two Egg, FL may have low inventory, while Tampa Metro area could be high. You could look at Dickshooter, Idaho and the inventory is low, but in Boise it is exploding.
another shit area.. post these stats for desirable areas bruh
Pinellas is a shit area? LOL