What a difference a year makes. Actually, what a difference 8 or 9 months make. It was not that long ago that the housing market was red hot and sellers could anticipate listing their homes for sale and receiving at least one offer within a few days. In fact, most new listings would contain broker remarks stating that all offers were due to the listing agent by a certain date and time. Well, those days are in the past. With the Federal Reserve’s aggressive rate hike throughout the year to try and tackle inflation, it has essentially stopped the housing market. As a result, this is leading to more frustrated sellers opting to de-list their homes.
More listings and more de-listings
Overall, we have seen a gradual improvement in the inventory of homes for sale throughout 2022. Not surprisingly, this is the result of properties remaining on the market for longer periods of time combined with skyrocketing interest rates sidelining more would-be home buyers. While the increased inventory is welcomed news for buyers, the significant slowdown in buyer activity has led to some frustration for home sellers. As a result, we have seen a record number of homes de-listed from the market. In fact, for every 50 homes listed for sale for the 12 weeks ending November 20, 2022, a record 2% were de-listed each week. When looking at the same time period a year earlier, 1.6% of homes were de-listed each week.
As for why we are seeing more homes being de-listed, the answer is fairly clear. For starters, many sellers likely still have the high prices and bidding wars of last year in their memories and quickly become frustrated when they don’t experience this for their listed property for sale. In addition, it can be highly frustrating for sellers to have their homes listed for sale only to not get any showings. Unfortunately, sellers need to realize that buyers in this market are facing some significant challenges with rising mortgage rates. To put this in perspective, the monthly mortgage payment on the median-asking-price home is 40% higher than it was one year ago. Needless to say, it is totally understandable that buyer activity will decrease substantially.
Florida metro markets: weekly de-listing averages & year-over-year changes
- Fort Lauderdale: 1.6%, up 0.2 points year-to-year
- Jacksonville: 1.9% up 0.9 points
- Miami: 1.9%, up 0.1 points
- Orlando: 2.0%, up 0.4 points
- Tampa: 1.9%, up 0.3 points
- West Palm Beach: 1.7%, up 0.3 points
Although the increase in number of properties being de-listed may not seem significant, they actually are given the already tight inventory being seen in the market. With this said, it is important for sellers to recalibrate their expectations in the current market. Given the current inflationary pressures and economic issues, it is likely that we will see a fairly stagnant housing market for some time. It is important to remember that there are opportunities in any market. Now more than ever it is important to consult with your local and knowledgeable real estate agent to best navigate the current market.