Happy Monday, May 18, 2020
In April 2020, the Hillsborough County single-family housing market favored Sellers.
Single-Family Homes For Sale fell 18.1% from April 2019 and 2.1% from March 2020. Single-Family Homes Sold dropped 23.1% year over year and 17.7% month over month. Single-Family Homes Under Contract rose 2.2% compared to March of this year but declined 20.5% compared to the previous April.
The Months of Inventory based on Closed Sales was 2.3 months, up 4.6% from April 2019.
The Average Sold Price per Square Footage climbed 1.3% compared to March 2020 and 6.8% compared to April 2019. The Median Sold Price increased 3.1% from March 2020. The Average Sold Price climbed 5% during the same time period.
The Average Days on Market fell 13.3% compared to April of last year. The ratio of Sold Price vs. Original List Price of 96% rose 1.1% compared to April 2019.
Home Sales (Sold)
In April 2020, 1472 single-family homes sold in Hillsborough County. That was 23.1% less than the 1913 sold in April 2019 and 17.7% lower than the 1789 sales in March 2020.
Current Inventory of Homes (For Sale)
In April 2020, 760 fewer homes were for sale than in April 2019, an 18.1% decline. Current single-family housing inventory decreased 2.1% compared to March 2020.
Homes Under Contract (Pending)
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 April 2020 Average Sold Price per Square Footage of $157 climbed 1.3% from $155 in March 2020 and 6.8% from $147 in April 2019.
The Days The Average Days on Market Shows Downward 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 April 2020 of 52 days dropped 5.5% from 55 days in March 2020 and 13.3% from 60 days in April 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. April 2019’s Sold Price vs. Original List Price of 96% held steady compared to March of this year and ticked up 1.1% compared to April 2019.
The Average For Sale Price is Neutral
The Average For Sale Price in April was $489,000, up 1.2% from $483,000 in April 2019 and 1% from $484,000 in March 2020.
The Average Sold Price is Appreciating
The Average Sold Price in April was $336,000, up 12% from $300,000 in April 2019 and 5% from $320,000 in March 2020.
The Median Sold Price is Appreciating
The Median Sold Price in April was $270,000, up 8.9% from $248,000 in April 2019 and 3.1% from $262,000 in March 2020.
April 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
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 April 2020 Absorption Rate based on Closed Sales of 42.9 decreased 6.1% compared to April 2019 and 16.1% compared to March 2020
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Today, many people are asking themselves if they should buy or sell a home in 2020. Some have shifted their plans or put them on hold over the past couple of months, and understandably so. Everyone seems to be wondering if the market is going to change and when the economy will turn around. If you’re trying to figure out what’s going to happen and how to play your cards this year, you’re not alone.
This spring in the 2020 NAR Flash Survey: Economic Pulse, the National Association of Realtors (NAR) has been tracking the behavior changes of homebuyers and sellers. In a reaction to their most recent survey, Lawrence Yun, Chief Economist at NAR, noted the beginnings of a turn in the market:
“After a pause, home sellers are gearing up to list their properties with the reopening of the economy…Plenty of buyers also appear ready to take advantage of record-low mortgage rates and the stability that comes with these locked-in monthly payments into future years.”
What does the survey indicate about sellers?
Sellers are positioning themselves to make moves this year. More than 3 in 4 potential sellers are preparing to sell their homes once stay-at-home orders are lifted and they feel more confident, which means more homes will start to be available for interested buyers.Just this week, Zillow also reported an uptick in listings, which is great news for the health of the market:
“The number of new for-sale listings overall has shown improvement, up 5.9% last week from the previous week. New listings of the most-expensive homes…are now seeing the biggest resurgence, up 8%. The uptick is likely a sign sellers are feeling more confident because of improving buyer demand, as newly pending sales have also jumped up during the same period.”
What does the survey note about buyers?
The recent pandemic has clearly impacted buyer preferences, showing:
- 5% of the respondents said buyers are shifting their focus from urban to suburban areas.
- 1 in 8 Realtors report changes in desired home features, with home offices, bigger yards, and more space for their families becoming increasingly important.
- Only 17% said buyers stopped looking due to concerns about their employment or loss of a job.
If you’re thinking about putting your house on the market, let’s connect today. There’s a good chance an eager buyer is looking for a home just like yours.
While growing up, we were taught by our parents and grandparents that owning a home is a financially savvy move. They explained how a mortgage is like a “forced savings plan.” When you pay rent, that money is lost forever. When you make a mortgage payment, much of that money accumulates as equity in the home. So, what exactly is equity?
The equity in your home is the amount of money you can sell it for minus what you still owe on the mortgage. Every month you make a mortgage payment, and every month a portion of what you pay reduces the amount you owe. That reduction of your mortgage every month increases your equity.
A recent study by CoreLogic explained that homeowners gained substantial equity over the last twelve months, and are essentially sitting on large sums of cash in their homes. In the study, Frank Nothaft, Chief Economist for CoreLogic explained:
“The CoreLogic Home Price Index recorded a quickening of home price gains during the fourth quarter of 2019, helping to boost home equity wealth. The average family with a mortgage had a $7,300 gain in home equity during the past year, and a total of $177,000 in home equity wealth.”
For most families, their home is their largest financial asset. This increase in equity drives the net worth, or family wealth, of the homeowner. Renters are not earning that benefit. Instead, they’re building the net worth of their landlord.
Home price growth will moderate during the pandemic. But once a cure is available, most experts agree that home values will again begin to appreciate at levels similar to what we’ve seen over the last several years. In the long run, our family elders will be proven correct: owning a home is a savvy financial move.
May 14, 2020
Mortgage rates have stabilized at very low levels over the last few weeks as homebuyer demand slowly improves. Although purchase applications reached a new low in mid-April, today purchase demand is only down ten percent from one year ago. While demand is improving, inventory is low and declining with no signs of a turnaround yet.
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!