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A Florida Housing Market Like We Have Never Seen Before
Dated: September 15 2020
Have You Ever Seen a Housing Market Like This?
The year 2020 will certainly be one to remember, with new realities and norms that changed the way we live. This year’s real estate market is certainly no exception to that shift, with historic highlights continuing to break records and challenge what many thought possible in the housing market. Here’s a look at four key areas that are fundamentally defining the market this year.
Housing Market Recovery
The economy was intentionally put on pause this spring in response to the COVID-19 health crisis. Many aspects of the common real estate transaction in the Tampa Bay, FL housing market were placed on hold at the same time. Thankfully, technology and innovation helped the housing industry continue to move forward, and business suddenly picked back up at faster-than-normal-rates in Florida as shelter-in-place orders were lifted around the State.
The result? Total transformation of the Tampa Bay housing market from brief rock-bottom lows to exceptional highs. Today, the housing market we're experiencing in Pinellas County and the Greater Tampa Bay area of Florida is being called truly remarkable by many experts and is far exceeding expectations. From pending home sales to purchase applications, Florida home buyers are back in business and homes are selling – fast.
According to the Housing Market Recovery Index by realtor.com, the United States housing market has surpassed pre-pandemic levels, and has regained the strength we remember from February of this year (See graph below):
Record-Breaking Mortgage Rates
Historically low mortgage interest rates are another game changer in the Florida housing market as well. Today’s low interest rates are one of the big motivating factors bringing home buyers into the Tampa Bay housing market faster than we've ever seen before. The average mortgage interest rate reached an all-time low on multiple occasions this year, and it continues to hover in record-low territory, making home buying affordable despite increasing real estate prices around the State.
When mortgage rates are this low in Florida and around the country, buyers have a huge opportunity to get more for their money when purchasing a home, something many are eager to find while continuing to spend more time than expected at home this year, and likely beyond.
Continued Home Price Appreciation
One of the key drivers of home price appreciation in the Tampa Bay area of Florida this year is historically low inventory. The housing inventory in Pinellas County, FL was low going into the pandemic, and it is still sitting well below the level needed for a normal market, with available inventory hovering around just 1.5 months on hand in the month of August 2020 in Pinellas County. Home sellers are slowly making their way back into the game, but buyers are scooping up homes faster than they’re coming up for sale, making this housing market more competitive than ever.
This is a classic supply and demand housing scenario, forcing home prices to rise in the Tampa Bay area and around the U.S. Selling something when there is a higher demand for what is available naturally bumps up the price. If you’re ready to sell your Tampa Bay or Pinellas County home today, this may be the optimal time to make your move. As Bill Banfield, EVP of Capital Markets at Quicken Loans, notes:
“The pandemic has not stopped the consistent home price growth we have witnessed in recent years.”
Even as home prices continue to rise, affordability is working in favor of today’s home buyers in Florida. According to many experts, mortgage rates this low are offsetting rising home prices, which increases buyer purchasing power – an opportunity not to be missed, especially if your family’s needs have changed. If you now need space for a home office, gym, virtual classroom, movie room, and more, it may be time to reconsider your current house. To search newly listed homes around Pinellas County and Tampa Bay, click here.
According to Mortgage News Daily:
“Those shopping for a home can afford 10 percent more home than they could have one year ago while keeping their monthly payment unchanged. This translates into nearly $32,000 more buying power.”
With mortgage rates hitting historic lows, home prices appreciating, affordability rising, and the Florida housing market recovering like no other, 2020 has been quite a year for real estate – perhaps one we’ve never seen before and may never see again. Let’s connect today if you’re ready to take advantage of this year’s record-breaking opportunities in the Tampa Bay housing market.
Gabe has been a resident of Seminole and the surrounding Gulf Beaches his entire life. His vast market knowledge of many of the trendiest Downtown and Beach subdivisions in Pinellas County is simply u....
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