Happy Monday, June 15, 2020
In May 2020, the Hillsborough County single-family housing market favored Sellers.
Single-Family Homes for Sale fell 29.1% from May 2019 and 12.6% from April 2019. Single-Family Homes Sold decreased 29.2% year over year but increased 0.5% month over month. Single-Family Homes Under Contract jumped 54.2% compared to April 2020 and 14.7% compared to May 2019.
The Months of Inventory based on Closed Sales was 2 months, the same as the previous May.
The Average Sold Price per Square Footage dropped 1.3% compared to April of this year but climbed 4.8% compared to May of last year. The Median Sold Price ticked up 0.7% from April 2019, while the Average Sold Price decreased 0.6% during the same time period.
The Average Days on Market declined 6.9% compared to May 2019. The ratio of Sold Price vs. Original List Price of 96% rose 1.1% compared to May 2019.
Home Sales (Sold)
In May 2020, 1492 single-family homes sold in Hillsborough County, a 29.2% drop from the 2106 in May 2019. It was 0.5% higher than the 1485 sales in April 2020.
Current Inventory of Homes (For Sale)
In May 2020, 1228 fewer homes were listed for sale than in May 2019. That shows a 29.1% decline. The current inventory of single-family homes in Hillsborough County fell 12.6% compared to April 2020.
Homes Under Contract (Pending)
In May 2020, 2400 single-family homes were under contract. That was a 54.2% increase from the 1556 in April 2019. It was 14.7% higher than in May 2019.
The Average Sold Price per Square Foot shows the direction of home prices. Median Sold Price and Average Sold Price can sometimes be skewed by outliers that sell for a really high or low price. So the Average Sold Price per Square Footage is a more normalized indicator of home values. The May 2020 Average Sold Price per Square Footage of $154 dropped 1.3% from $156 in April 2020 but increased 4.8% from $147 in May 2019.
The Days The Average Days on Market Shows Neutral Trend
The average Days on Market (DOM) shows how many days the average property is on the market before it sells. An upward trend in DOM trends to indicate a move towards more of a Buyer’s market, a downward trend indicates a move towards more of a Seller’s market. The DOM for May 2020 of 54 days rose 5.9% from 51 days in April of this year but declined 6.9% from 58 days in May of last year.
The Sold/Original List Price is Rising
The Sold Price vs. Original List Price reveals the average amount that sellers are agreeing to come down from their original list price. The lower the ratio is below 100% the more of a Buyer’s market exists, a ratio at or above 100% indicates more of a Seller’s market. May’s Sold Price vs. Original List Price of 96% stayed the same as April 2020 and ticked up 1.1% % from May 2019.
The Average For Sale Price is Appreciating
The Average For Sale Price in May was $530,000, up 10% from $482,000 in May 2019 and 8.4% from $489,000 in April 2020.
The Average Sold Price is Neutral
The Average Sold Price in May was $330,000, up 5.8% from $312,000 in May 2019 and down 0.6% from $332,000 in April 2019.
The Median Sold Price is Appreciating
The Median Sold Price in May was $272,000, up 4.6% from $260,000 in May 2019 and 0.7% from $270,000 In April 2020.
May 2020 was a Seller’s Market*
A comparatively lower Months of Inventory benefits sellers while a higher Months of Inventory favors buyers.
*Buyer’s market: more than 6 months of inventory
Seller’s market: less than 3 months of inventory
Neutral market: 3 – 6 months of inventory
Months of Inventory based on Closed Sales
The May 2020 Months of Inventory based on Closed Sales of 2 months stayed flat compared to May 2019 but fell 13% compared to April 2020.
Absorption Rate measures what percentage of the current active listings are being absorbed each month.
*Buyer’s market: 16.67% and below
Seller’s market: 33.33% and above
Neutral market: 16.67% – 33.33%
Absorption Rate based on Closed Sales
The May 2020 Absorption Rate based on Closed Sales of 49.8 held steady compared to May 2019 and jumped 15% compared to April 2020
From Our Blog:
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With more U.S. states reopening for business this summer, and as people start to return to work, we can expect the economy to begin improving. Most expert forecasts indicate this economic recovery will start to happen in the second half of this year. As we get back to work and the financial landscape of the country begins to turn around, many experts also agree that real estate has the potential to lead the way in the recovery process.
According to Ivy Zelman of Zelman & Associates:
“Housing will fare better than expected during this severe downturn.”
In addition, CNBC notes:
“Mortgage demand from home buyers shows unexpectedly strong and quick recovery…The quick recovery has surprised most forecasters.”
Robert Dietz, Chief Economist and Senior Vice President for Economics and Housing Policy of the National Association of Home Builders (NAHB) says:
“Overall, the data lend evidence to the NAHB forecast that housing will be a leading sector in an eventual economic recovery.”
One of the big reasons why housing has the potential to be such a driving force is the significant impact it has on the local economy. This impact is particularly strong when a newly constructed home is built and sold. According to a recent study by the National Association of Realtors (NAR), the average new home sale has a total economic impact of $88,416. As outlined in the graphic below, this is a combination of income generated from real estate industries, expenditures, and new home construction.With so many unknowns today, especially in the wake of a worldwide pandemic, one known factor is the bright spark the housing market can play in local and national recovery. Buying and selling a home goes well beyond personal growth and satisfaction – it supports our economy as a whole.
According to experts, the economy will begin to recover in the second half of this year. With real estate as a driver, that recovery may start sooner than we think.
Every year, Gallup conducts a survey of Americans to determine their choice for the best long-term investment. Respondents are asked to select real estate, stocks/mutual funds, gold, savings accounts/CDs, or bonds.
For the seventh year in a row, real estate has come out on top as the best long-term investment. Gallup explained:
“Real estate remains the most favored investment to Americans, as has been the case since 2013, when the housing market was on the rebound. More than a third of Americans have named real estate as the top investment since 2016.”
The belief of the American people in the stability of housing as a long-term investment remains strong, even through the many challenges our economy faces today.
June 11, 2020
The rebound in homebuyer demand continued this week, driven by mortgage rates that hover near record lows. This turnaround in demand, particularly by those who have higher incomes than the typical household, also reflects deferred sales from the Spring.
Thanks for reading Tampa Market Monday. We’d love to help you buy or sell your home, so please get in touch! You can reach me, Doug Bohannon or Dale Bohannon at 813-979-4963 or by completing this contact form.
Have a Fantastic Day!
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Thanks for taking time to read the Tampa Market Monthly! If you want to buy or sell a home or find out your home’s value please let us know. We’d love to work with you. You can reach me, Doug Bohannon or Dale Bohannon at 813-979-4963 or by completing this contact form. You can search all Tampa area homes for sale at www.teambohannon.com.
Have a Fantastic week!