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 April 2022 compared to April 2021. 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
The inventory crisis last year caused demand to spike higher than ever by fall and into the winter, which in turn caused prices to continue to increase significantly. This rise has continued to the present day without reason to expect they’ll decrease anytime soon, though the hope is that the rate of increase will slow down especially now that mortgage rates have risen.
Broward County
Broward County single family and condo/townhome sales, new listings and pending sales decreased, but average price increased year over year.
Miami-Dade & Palm Beach Counties
In April of 2022, Miami-Dade single families saw decreases in every category. Condos/townhomes show a decrease in closed sales, new listings and pending sales, but average price saw a slight increase year over year.
Palm Beach County saw a decrease in closed sales, new listings, and pending sales, but an increase in average price for single families and condos/townhomes.
South Florida Inventory
Active inventory in South Florida started out historically low at the beginning of the year, but as predicted, inventory is up slightly in April 2022 as mortgage rates continue to rise and sales decline as a result. However, South Florida may be less impacted, especially for condos, by the rates compared to other regions with so many cash buyers in the market.
What’s Ahead?
As mortgage rates continue their ascent, closed sales across all three counties are down significantly, as expected, for both single family homes and condos/townhomes. Additionally, pending sales have also seen a significant reduction, indicating that closed sales will continue to be affected in the months to come. New listings are also down year over year in both single family and condos/townhomes across all three counties which will further the decrease in new listings and pending sales.
The rise in mortgage rates will inevitably lead to a moderation of price increases given that less buyers will be in the market (i.e., lessening in demand) and sellers will have less power over price forcing price reductions. There has already been a notable uptick nationally in price changes in the market recently, demonstrating this lessening of seller power, and a sign that the market is, in fact, already starting to change. Anthony explained this in detail in his recent Market Update video. Click here to watch.
The rise in mortgage rates coupled with increasing inflation has significantly affected housing affordability, and securing financing becomes a very real concern for buyers. Many that qualified for financing under a lower rate must be re-preapproved at a higher rate, and their budgets have to be adjusted for the new cost. This can lead to looking for homes in a lower price bracket as the higher rates and continually rising prices require higher down payments and higher monthly mortgage payments. We will continue to see the impact of this rate increase on closed sales in the coming months.
*Data provided by Florida Realtors® SunStats