Market Update For September 2020 With Brad OConnor Ph.D. TRT 4 minutes 18 seconds
Video Description Brad OConnor: Various Charts and graphs that illustrate market measures and trends dissolve up on screen as Brad describes market conditions.
The Florida resale housing market remained hot through the end of the summer and into the fall, based on the newly released September 2020 market statistics from Florida Realtors. In normal years, the statewide rate of closed existing home sales typically drops off in September, but that was not the case here in 2020. Closed sales of single-family homes were barely below August’s total, and were actually up 22 percent on a year-over-year basis the largest such increase we’ve seen since December of last year. This brings us to a very important milestone for 2020, which is that the year-to-date total of closed existing single-family home sales now exceeds the total from the first nine months of 2019. It’s hard to believe given all that has occurred this year that we are already in positive territory again, but here we are. And all indications are that we will continue to see strong sales this fall as mortgage interest rates will almost certainly remain at or near record lows.
New pending sales of single-family homes were very strong in September, rising by over 31 percent year-over-year. The resale market for condos and townhouses continued to show improvement as well in September. In fact, closed sales in this category actually exceeded their August total and were up over 25 percent compared to a year ago. While this was enough to push our dollar volume for the year above where we were at this point in 2019, the number of closings for the year in this category is still down about 6 percent compared to this point in time last year. But, hey, we still have 3 months to go in 2020, so maybe we still have a shot. It’s difficult to be pessimistic about our chances at this point, given that new pending sales of condos and townhouses were up a dramatic 43 percent year-over-year in September. The national inventory shortage remains the biggest constraint to the housing market right now. Builder confidence, as measured by the National Association of Home Builders/Wells Fargo Housing Market Index, hit an all-time high in September, but the construction industry continues to face challenges such as low labor productivity and skilled labor shortages, high materials prices, land constraints, and the usual mix of regulatory impediments that can make it difficult to produce the types of homes that are in greatest demand particularly single-family starter homes.
So in the short- to medium-term, we’re really going to have to rely on new listings of existing homes for more inventory but even then, since sellers are usually buyers, too, this can only help so much. Statewide, new listings in September *were* up over 12 percent and 21 percent year-over-year in the single-family and condo/townhouse categories, respectively, which were the largest year-over-year increases we’ve seen in either category at least a couple of years. But again, with so many homes going under contract during September, we still saw inventory levels fall throughout the month. As of the end of September, we had over 37 percent fewer active single-family listings and over 7 percent fewer condo and townhouse listings than we did a year ago. With the inventory crunch continuing in the face of strong demand, sale prices remain at elevated levels. The median sale price for closed single-family home sales in September was $300,000, which is over 13 percent higher than that of September 2019. Likewise, in the condo and townhouse category, the median sale price was up just under 13 percent year-over-year, rising to $217,500. As always, though, the statewide numbers may not reflect the trends for your particular market area or niche. So it’s important for you to monitor your *local* market stats, too. Florida Realtors makes this easy for our members through our innovative SunStats web application and comprehensive catalog of local market reports. Just visit floridarealtors.org and click on the “Tools & Research” heading to get started! We’ll see you next month!