2020 Real Estate Outlook: Expert Predictions for Mortgage Rates, Home Prices, Tech and More

Real Estate Outlook2020 Real Estate Outlook

The 2019 housing market has been one of low rates, high demand and limited supply—particularly on the lower-priced end of the real estate market.

Will 2020 be more of the same? According to experts, yes and no.

We spoke to six mortgage, real estate, and housing professionals. Here’s what they say is in store for the year to come:

Mortgage rates will stay low—or maybe go lower.

Mortgage rates currently sit at 3.75%, according to Freddie Mac’s most recent numbers—nearly a 1% difference from the monthly average a year ago. The drop in rates caused a surge in refinancing over the last few months, and purchase activity ticked up as well.

According to Odeta Kushi, deputy chief economist at title insurance and settlement services provider First American, there’s “emerging consensus” that rates will remain low next year—likely somewhere between 3.7% and 3.9%, she says.

Forecasts from Freddie Mac and the Mortgage Bankers Association back this up, both predicting 2020 rates within this range. Fannie Mae actually predicts rates will clock in even lower, vacillating between 3.5% and 3.6% throughout the year.

Sean Hundtofte, chief economist for online mortgage lender Better.com, says that thanks to these continued low rates, refinancing should remain a popular choice in the new year. And for homebuyers, he says, they’ll “be able to afford more house than they would have otherwise.”

Prices will keep on rising.

Home prices will continue their climb upward, according to experts, largely thanks to tight inventory and high demand.

According to the latest home price forecast from property data firm CoreLogic, home prices should tick up by 5.6% by next September—up from the just 3.5% jump we saw this year.

As Daryl Fairweather, chief economist for real estate brokerage Redfin, explains, “Right now we aren’t seeing a ton of new listings. Without more listings coming on the market, there will be more competition starting off in early 2020 and that will lead to more price pressure.”

The problem will be worse on the lower end of the price spectrum. According to Ralph DeFranco, chief economist for mortgage insurer Arch MI, entry-level home prices will rise higher than incomes next year—and disappointing construction numbers will only compound the issue.

“Low interest rates and a shortage of starter homes will continue to push up prices,” DeFranco said. “This is especially the case for lower price points, since builders have tended to focus on more expensive, higher-profit houses and less on replenishing low inventories of entry-level homes.”

It seems the price growth may continue beyond 2020, too. Data from Arch MI shows the chance of home price declines at a mere 11% for the next two years. There are currently no states or metro markets projected to see prices declines in that period.

Inventory will be tight.

Housing inventory is going to remain limited for much of 2020, experts say. And interest rates and record-high homeownership tenures are a big part of the problem.

According to recent data from Redfin, the average homeowner is staying in their home 13 years—up from just eight years in 2010. In some cities, homeownership tenures are as high as 23 years.

As Kushi explains, “You can’t buy what’s not for sale.”

“While historically low rates increase buying power and make it more likely for potential buyers to attain their homeownership dream, they also increase the risk of a long-run housing supply shortage, which we predict will continue through 2020 and possibly intensify,” Kushi says. “As first-time buyers lock-in these historically amazing rates and existing owners refinance—in droves in recent months, everyone will stay put and not sell. Where’s the incentive?”

There’s a chance that increasing construction may offer some relief in the inventory department. Last month’s residential construction report from the Census Bureau saw building permits and housing starts both increase over the year. At the same time. builder confidence was at a 20-month high, according to the National Association of Home Builders.

Still, it may not be enough to meet the needs of today’s buyers, Kushi says.

“As for building new homes, builders have a reason to be cautiously optimistic, given pent up demand stemming from a strong economy, lower mortgage rates and continued wage growth,” she says. “However, building pace still lags behind historical standards, and it will likely take months before we can begin building at a pace that will support the demand.”

Millennials will keep up their homebuying streak, while Boomers hold up inventory.

Data from Realtor.com shows Millennials made up a whopping 46% of all mortgage originations in September—up from 43% one year prior. Meanwhile, shares of Baby Boomer and Gen X mortgage activity declined.

It’s no wonder, either. Millennials rank homeownership as one of their top goals in life—higher than even marrying or having kids—and with interest rates low and incomes up, it’s the right time to buy a home for many.

Unfortunately, they face an uphill battle. As Kushi explains, “Looking ahead, Millennials may be entering a tougher housing market in 2020. A limited supply environment, combined with growing demand and increased competition for homes, is accelerating home price growth once again.”

The Baby Boomer generation is part of the challenge for this younger cohort, as many are choosing to age in place—keeping more homes off the market than ever before.

In fact, a recent study from Freddie Mac shows that if today’s older adults—those born between 1931 and 1959—behaved like earlier generations, then an additional 1.6 million homes would have hit the market by the end of the last year.

As Kushi puts it, “The fate of Millennial homebuying to close out 2019 and into 2020 will depend on two factors: if there is anything for them to buy, and whether rising purchasing power stemming from increasing income and historically low mortgage rates can continue to outpace house price appreciation.”

The suburbs will be a big draw thanks to Millennial demand.

As home prices skyrocket, cash-strapped Millennials are looking toward more affordable places to put down roots—namely smaller, suburban towns on the outskirts of major metros.

The trend has led to an uptick in “Hipsturbia” communities—live-work-play neighborhoods that blend the safety and affordability of the suburbs with the transit, walkability and 24-hour amenities of big cities.

Melissa Gomez, an agent with ERA Top Service Realty in New York, has seen the trend in action.

“Being based in the boroughs of NYC, I see Hipsturbia happening every day,” she said. “As cities like New York become increasingly expensive, younger people and families are looking for more bang for their buck with real estate, schooling and everything in between. And slowly but surely, it is breathing new life into small towns outside of major urban hubs.”

The Urban Land Institute recently named Histurbia as one of its top real estate trends to watch in 2020.

As the report explains, “If the live-work-play formula could revive inner cities a quarter-century ago, there is no reason to think that it will not work in suburbs with the right bones and the will to succeed.”

The industry will continue to digitize. 

The mortgage and real estate spheres have been moving away from their manual, paper-laden processes in recent years, and 2020 will only see that trend expand further—especially as more tech-savvy Millennials enter the market.

As Hundtofte explains, “In 2020, we’ll continue to see Millennials growing their share of the mortgage market, which in turn, will serve as a catalyst to lenders to continue to rapidly innovate their technology offerings to meet the expectations of an audience more accustomed to an Amazon, Venmo-like experience.”

Though plenty of tech offerings already exist—from e-signing and e-notary software to fully-digital mortgage applications, automated income verification and more—Hundtofte says we’ll probably see these solutions start teaming up in the new year.

“Rather than compete with each other, we’ll see companies combining technologies across the board, from startups partnering with startups to startups partnering with legacy institutions,” he says.

Aaron Block, the co-founder of MetaProp—a venture capital fund focusing solely on real estate technology—says to keep an eye on the Airbnb and WeWork brands specifically in this regard.

On WeWork’s recent IPO blunder, Block says, “One major positive outcome of this year’s ‘DiePO’ is the plethora of ‘proptech’ innovation talent hitting the street. Some exciting new companies are being formed as we speak.”

Forbes.com Nov. 15, 2019

 

Realtor® Survey Shows Decline in Foreign Investment in U.S. Residential Real Estate

Foreign InvestmentForeign Investment Down 36%

A decline in global growth and low housing inventory contributed to a drop in foreign investment in U.S. residential real estate over the past year.

This is according to an annual survey of residential purchases from international buyers, released today by the National Association of Realtors®, which found that foreign buyers purchased fewer U.S. existing homes from April 2018 through March 2019. Global economic growth, which increased in 2016 to 2017, slowed to 3.6% in 2018 and is on pace to taper to 3.3% in 2019.

NAR’s Profile of International Transactions in U.S. Residential Real Estate 2019 revealed that foreign buyers purchased $77.9 billion worth of U.S. existing homes from the 2019 survey reference period, a 36% decline from the level reached in the previous 12 months ($121 billion). Non-resident foreign buyers accounted for $33.2 billion of U.S. existing-home sales, a 37% decline from the prior level of $53 billion. Resident foreign buyers – that is, recent immigrants – purchased $44.7 billion of residential property, a 34% drop from the prior level ($67.9 billion).

The dollar volume of purchases saw a decline as the number of purchases, as well as the average price, decreased from the previous year, as foreign buyers purchased in comparison to the levels during the previous 12 months. Foreign buyers were able to buy 183,100 properties (266,800 in the previous period) at an average price of $426,100.

“A confluence of many factors – slower economic growth abroad, tighter capital controls in China, a stronger U.S. dollar and a low inventory of homes for sale – contributed to the pullback of foreign buyers,” said Lawrence Yun, NAR chief economist. “However, the magnitude of the decline is quite striking, implying less confidence in owning a property in the U.S.”

Top Foreign Buyers

For the seventh consecutive year, China exceeded all other countries in terms of dollar volume of purchases, buying an estimated $13.4 billion worth of residential property, a 56% decline from the previous 12 months. The Chinese economy is growing at a slower pace compared to past years, slowing to 6.3% in 2019 compared to 6.9% in 2017. The Chinese government has also tightened the monitoring of dollar outflows since 2016 to manage its foreign exchange reserves.

Following China, the next top foreign buyer for 2019 was Canada at $8.0 billion. While Chinese investors and Canadian investors tied concerning the number of purchases, on average, Chinese buyers bought properties at a higher price point. Therefore, China ranked ahead of Canada in terms of dollar volume.

The third top international buyer was India at $6.9 billion, the United Kingdom was fourth at $3.8 billion and in fifth was Mexico at $2.3 billion. Each of the top five buyers experienced a decline in the dollar volume of purchases.

International Buyers – Where Did They Go?

Following historical trends, Florida was at the epicenter of foreign investment. The state attracted 20% of foreign buyers. Forty-two percent of Canadians purchased property in Florida. “Many Canadians and other foreigners found Florida so enticing because of its lenient tax laws,” said Yun. “Additionally, many Florida metro areas have an inventory of cheaper properties, relatively speaking – a combination which makes the state a very popular destination.”

California followed Florida, accounting for 12% of international purchases. Thirty four percent of Chinese buyers purchased property in California, which represents a decline from one year ago.

The third most popular destination among international buyers was Texas (10%), particularly desirable among Indian and Mexican buyers.

Arizona accounted for 5% of international buyers, popular for Canadian and Mexican purchasers, followed by New Jersey (4%). New Jersey appealed to a mix of international buyers, especially those from the United Kingdom.

A few other significant destinations were North Carolina, Illinois, New York and Georgia. Each of these states accounted for 3% of all foreign buyers.

Price Points

Forty-four percent of foreign buyers purchased in a suburban area, while 76% purchased single detached family homes and townhomes.

  • The median purchase price for foreign buyers was $280,600, slightly higher than the $259,600 average for all U.S. existing homes sold. According to Yun, the price difference is a reflection of the choice of location and the kinds of properties desired by foreign buyers.
  • Eight percent of international buyers paid $1 million or more for their property, compared to just 3% of all U.S. existing homebuyers.
  • Resident foreign buyers – those living in the United States either as recent immigrants or those holding visas for professional, educational or other purposes – typically purchased properties at a slightly higher price point ($282,500) compared to non-resident foreign purchasers ($277,700).

“Even though numbers were lower this year than during the previous 12 months, international investors and buyers still spent and invested a great deal of money in U.S. real estate,” said NAR President John Smaby, a second-generation Realtor® from Edina, Minnesota and broker at Edina Realty. “Home buyers from across the globe know that the U.S. market is still a safe, secure and promising place to invest.”

The survey also showed that international buyers are more likely to purchase their homes in cash than all existing home buyers. Forty-one percent of the reported transactions were all-cash sales, in comparison to 21% for all existing-home purchases during the 2019 assessment reference period.

Non-resident foreign buyers are more likely to pay in cash than resident foreign buyers, who are more likely to acquire mortgage financing from U.S. sources. Sixty-three percent of non-resident foreign buyers had an all-cash purchase transaction, compared to 25% among resident foreign buyers.

Canadian buyers, who primarily live abroad, were the most likely to pay all cash (75%). The majority of Asian Indian buyers, most of whom resided in the U.S. as recent immigrants or visa holders, obtained a U.S. mortgage. Almost half of Chinese buyers made an all-cash purchase.

NAR’s 2019 Profile of International Transactions in U.S. Residential Real Estate was conducted April 5 through May 3, 2019. A sample of Realtors® was surveyed to measure the share of U.S. residential real estate sales to international clients, and to provide a profile of the origin, destination and buying preferences of international clients, as well as the challenges and opportunities faced by Realtors® in serving foreign clients. The survey presents information about transactions with international clients during the 12-month period between April 2018 and March 2019. A total of 11,812 Realtors® responded to the 2019 survey.

 

National Association of Realtors® July, 2019

Florida Housing Report: Sales, Median Prices Rise in April

florida housing market

Florida’s housing market reported more sales, higher median prices and increased inventory (active listings) in April compared to a year ago, according to the latest housing data released by Florida Realtors®. Sales of single-family homes statewide totaled 26,992 last month, up 6.2% over April 2018.

“Still-low mortgage interest rates and a strong jobs outlook are positive trends for Florida’s housing market,” says 2019 Florida Realtors President Eric Sain, a Realtor and district sales manager with Illustrated Properties in Palm Beach. “Another strong sign: New pending sales for existing single-family homes in April rose 4.4% year-over-year, while pending sales for existing condo-townhouse properties remained at about the same level (-0.8%) as April 2018.

“Buying or selling a home can be a complex process; however, working with a Realtor who understands local market conditions enables consumers to have an expert on their side.”

In April, statewide median sales prices for both single-family homes and condo-townhouse properties rose year-over-year for the 88th consecutive month. The statewide median sales price for single-family existing homes was $259,470, up 2.6% from the previous year, according to data from Florida Realtors Research Department in partnership with local Realtor boards/associations. Last month’s statewide median price for condo-townhouse units was $194,050, up 2.1% over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.

According to the National Association of Realtors (NAR), the national median sales price for existing single-family homes in March 2019 was $261,100, up 3.8% from the previous year; the national median existing condo price was $244,400. In California, the statewide median sales price for single-family existing homes in March was $565,880; in Massachusetts, it was $390,000; in Maryland, it was $285,000; and in New York, it was $270,000.

Looking at Florida’s condo-townhouse market in April, statewide closed sales totaled 11,817, up 3.2% compared to a year ago. Closed sales may occur from 30- to 90-plus days after sales contracts are written.

“April was easily the strongest month we’ve seen so far this year for home sales in the Sunshine State,” says Florida Realtors Chief Economist Dr. Brad O’Connor. “Prior to April, single-family closed sales for 2019 were actually down year-over-year, but with April’s little surge (up 6.2%), sales in 2019 are now up by 1% compared to where we were through the first four months of 2018.

“The statewide inventory of active listings continued to rise on a year-over-year basis in April, but the rate of this growth continues to slow somewhat. As of the end of April, there were about 95,000 single-family homes listed in Florida’s MLSs (Multiple Listing Services) or 6.6% more than were listed at the same time last year. The total of active listings of condos and townhouses was closer to about 58,500, up 6.4% compared to last year.”

According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 4.47 percent in April 2019, compared to the 4.14 percent averaged during the same month a year earlier.

FloridaRealtors.org May 21, 2019

Florida Cities See Greatest Percentage of Price Cuts as Housing Market Cools

The housing market is tipping in favor of buyers, with a significant percentage of homes on the market selling for less than their original listing price.

This is according to real estate startup Knock, which reveals which markets have the highest percentage of homes that will sell below asking in its second quarter Deals Forecast.

Homebuyers are increasingly likely to score a deal, Knock says, forecasting that 75% of current listings will sell below their original listing price in Q2, and pinpointing the average number of days on the market as 25 and the average price reduction at 3.3% below asking.

The best deals, it reveals, can be found in the South.

Among the top 10 cities that had the greatest percentage of houses sell for less than asking, seven were located in the South.

Florida took the lead, with four cities in the sunshine state making the list, including Miami, which nabbed the No. 1 spot for both the size and the frequency of price reductions.

 

Florida Price Cuts

HousingWire.com April 5, 2019

Florida – Housing Outlook for 2019

Florida Housing 2019Florida housing outlook tops big-picture on the national scene

In its U.S. economic and housing market outlook for 2019, CoreLogic economists forecast growth in home prices to drop by one percentage point as higher interest rates impact the mortgage market, homeowners have an incentive to retain their current low-rate mortgages and new listings.

But Florida’s housing market is projected to do very well next year, market researcher and analyst Gord Collins wrote in his “Florida Housing Forecast 2019.” He reported that the Tampa/Sarasota housing market is “hot.”

Homes at two of the country’s top-selling master-planned communities prove that. Both Lakewood Ranch (No. 2) and West Villages (No. 5) surpassed 2017′s record sales marks weeks ago.

“The good news is that our inventories and pricing are staying in check, unlike other markets who are grappling with low inventories and mounting price pressures,” said Laura Cole, vice president of marketing for Lakewood Ranch developer Schroeder-Manatee Ranch.

West Villages President Paul Erhardt also expects demand to endure: “In parallel to Florida’s strong housing market, we continue to see increased traffic, buyer interest and sales across all of our communities within West Villages Florida,” he said.

In his latest residential real estate report, issued this week, Robert Goldman, a Michael Saunders & Co. Realtor and an attorney, stated that “Sarasota County has been on a tear” and “an unprecedented six-year run.”

Based on an analysis for Multiple Listing Service statistics for home sales in the county, the local and national economies, and his history in the market, Goldman forecast a continued stable and balanced housing market for the first three quarters of 2019 with inventory slowly growing and prices increasing in the 4 to 5 percent range.

“We are facing looming headwinds, but they will likely not surface until the end of 2019/2020,” he wrote.

In his prognostication, Collins also noted: “The housing market in Miami, Tampa, Orlando, Panama City, Sarasota, Naples, Fort Lauderdale, and even Boca Raton are compelling real estate investment value propositions for snowbirds and other buyers in North America.

“Interest in buying Florida properties is persistent, and given the strength of the Florida economy and tax situation in the Sunshine State, and an aging population, we should see strong prices for many years.”

In its “Pre-Mover Housing Index,” ATTOM Data Solutions, curator of a national multi-sourced property database, indicated the Tampa Bay area ranked sixth in loan applications from those ready to relocate.

In Florida, November marked 83 consecutive months — more than six and a half years — that statewide median sales prices for both single-family homes and condo-townhouse properties rose year-over-year.

“As we close out the year,” said Erica Plemmons, economist and director of housing statistics for Florida Realtors, “how has 2018 compared to 2017? Median sale price has continued its climb every month in 2018 versus the same month in 2017.”

In the Sarasota-Manatee market, the median home price ticked up 3.8 percent to $290,000 in the third quarter of this year.

Nationally, annual home price growth slid a bit in October to 5.48 from 5.52 percent in September, the seventh consecutive month of declines, according to S&P CoreLogic Case-Shiller Indices. The incremental decline began after March’s figure reached 6.53 percent.

In Wednesday’s new report, Ralph B. McLaughlin, deputy chief economist and executive of research and insights for CoreLogic, said, “It’s important to look at the bigger picture. Slowing price appreciation is still appreciation, and the current rate is more than double that of inflation.

“This continued growth, coupled with rising inventory and falling mortgage rates, suggests the bottom isn’t falling out of the housing market. Instead, the housing market is taking on a healthy diet that will allow it to be in better shape for the home buying season come spring.”

Impact of interest rates

CoreLogic’s December 2018 MarketPulse report, issued last week, stated that 30-year fixed mortgage rates will rise to an average of about 5.25 percent by next December, the highest in a decade.

“The larger monthly payments that come with higher mortgage rates will likely soften buyer demand, leading to less pressure on home prices,” wrote Frank Nothaft, chief economist at CoreLogic, a global property information and analytics company.

Aaron Terrazas, director of economic research for Zillow, predicts a higher mortgage rate coming next year — 5.8 percent — “territory not seen since the dark days of 2008 when rates were racing downward in response to the housing crisis.”

According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 4.87 percent in November, up from the 3.92 percent average during the same month a year earlier. For the week ending Dec. 27, the rate averaged 4.55 percent. During the same week in 2017, it was 3.99 percent, the lender reported Thursday.

For mortgage lending, higher rates mean even less refinancing in 2019. “We expect the refinance share of originations to decline to about 25 percent, the lowest in 25 years,” Nothaft said.

The growth in home equity and decisions by homeowners to remain in place should increase remodeling expenditures and the origination of home equity loans for home improvement purposes, CoreLogic predicted.

In her CoreLogic Equity Report included in the MarketPulse newsletter, economist Molly Boesel found that the amount of equity in mortgaged real estate increased by about $775 billion in the third quarter of 2018, a jump of 9.4 percent compared to the previous third quarter. The 2018 third-quarter gain dropped from the nearly $1 trillion in the year’s second quarter, which “reflects slowing price growth,” she wrote.

“The nationwide negative equity share for Q3 2018 was 4.1 percent of all homes with a mortgage, more than 20 percentage points lower than the peak negative equity share — 26 percent — recorded in Q4 2009,” Boesel found.

“Over the past 12 months, 81,000 borrowers moved into positive equity.”

Florida came in second to Nevada in the largest year-over-year decreases in negative equity share, at 2.1 percent. That compared with Nevada’s 4.3 percentage point drop.

In the Silver State, 72.7 percent of mortgages were underwater in the first quarter of 2010. That figure now stands at 4.7 percent, Boesel reported.

“The number of homes in a negative equity position have remained around 2.2 million for two consecutive quarters this year,” said Frank Martell, CoreLogic’s president and CEO. “Without equity, those homeowners are unable to sell their homes and are more likely to transition from delinquency to foreclosure if they face financial distress.”

The average year-over-year equity gain in Florida per borrower stands at $10,000.

The CoreLogic Home Price Index for this past October shows most Florida single-family home markets are overvalued, including Sarasota-Manatee, and that standing is forecast to remain in place five years from now.

While the major indicators in the national housing market have trended down over the past few months, pointing to a softening, “there is little reason for panic,” McLaughlin said.

“Current housing supply is still low: new and existing housing supply remain well below long-term historical averages. Future housing demand should continue to be robust: households under the age of 35, which account for the largest pool of potential home buyers, are starting to show signs they’re buying homes,” he said.

“Both factors should help long-term investors in the housing market remain confident.”

Sarasota Herald-Tribune December 27, 2018

Sarasota-Manatee Home Prices Rise Slower than Florida and U.S.

Home-price gains in Sarasota and Manatee County lagged behind the state and nation in October.

Single-family home prices rose 4.15 percent over the year in the Sarasota-Manatee area, less than the 5.4 percent average posted throughout Florida and the U.S., real estate database CoreLogic reported Tuesday.

Sarasota-Manatee ranked 248th for annual price change among the 403 U.S. metro areas analyzed.

Home prices here remain 14.0 percent off their pre-recession highs, CoreLogic said, the nation’s 47th smallest peak-to-current difference.

“Rising prices and interest rates have reduced home buyer activity and led to a gradual slowing in appreciation,” said Frank Nothaft, chief economist at CoreLogic. “October’s mortgage rates were the highest in seven and a half years, eroding buyer affordability. Despite higher interest rates, many renters view a home purchase as a way to build wealth through home-equity growth, especially in areas where rents are rising quickly.”

Local home prices increased 0.57 percent from September to October, slightly ahead of the 0.4 percent Florida rate and 0.50 percent nationwide rate.

The median resale price of single-family homes in Sarasota-Manatee is $283,000, according to the Florida Realtors trade group.

CoreLogic forecasts that home prices will grow by 7.2 percent in Florida and 4.8 percent nationwide in the next 12 months. They are expected to increase by 0.4 percent in Florida but decrease by 0.7 percent from October to November.

A related survey about home ownership found that buyers value safety and having something to call their own.

“Home ownership remains an important part of the American dream,” said Frank Martell, president/CEO of CoreLogic. “Our research found that being a homeowner makes consumers feel safe in their homes. Renters really want something to call their own. However, until affordability comes back into balance, renters will have a hard time purchasing a home.”

 

Sarasota Herald-Tribune Dec. 4, 2018

Florida Home Sales, Median Prices up in May 2017

Home salesFlorida Home Sales
Florida’s housing market reported more closed sales, higher median prices, more new listings and more pending sales in May, according to the latest housing data released by Florida Realtors®. Sales of single-family homes statewide totaled 27,850 last month, up 7.6 percent compared to May 2016.

“Buyer demand continues to fuel Florida’s housing market this month,” said 2017 Florida Realtors President Maria Wells, broker-owner with Lifestyle Realty Group in Stuart.”As for-sale inventory continues to be tight, prospective buyers are responding by being prepared, pre-qualified and ready to make an offer when they find the right home. Realtors across the state report that many newly listed homes are selling quickly. In May, sellers of existing single-family homes received 96.4 percent (median percentage) of their original listing price, while those selling townhouse-condo properties received 94.7 percent – a signal that the listed price is extremely close to market value.

“In this competitive and complex market, it is vital for consumers to work with a Realtor who will provide them expert guidance in the home buying or selling process.”

The statewide median sales price for single-family existing homes last month was $239,000, up 7.7 percent from the previous year, according to data from Florida Realtors® research department in partnership with local Realtor boards/associations. The statewide median price for townhouse-condo properties in May was $178,000, up 8.1 percent over the year-ago figure. May was the 66th consecutive month that statewide median prices for both sectors rose year-over-year. The median is the midpoint; half the homes sold for more, half for less.

According to the National Association of Realtors® (NAR), the national median sales price for existing single-family homes in April 2017 was $246,100, up 6.1 percent from the previous year; the national median existing condo price was $234,600. In California, the statewide median sales price for single-family existing homes in April was $536,750; in Massachusetts, it was $362,500; in Maryland, it was $285,023; and in New York, it was $235,000.

Looking at Florida’s townhouse-condo market, statewide closed sales totaled 11,538 last month, up 8 percent compared to May 2016. Closed sales data reflected fewer short sales and last month: Short sales for townhouse-condo properties declined 44.8 percent while short sales for single-family homes dropped 30.8 percent. Closed sales may occur from 30- to 90-plus days after sales contracts are written.

“Closed sales of existing homes in the Sunshine State not only rebounded from a relatively flat April, they positively surged to record highs in May of 2017,” said Florida Realtors® Chief Economist Dr. Brad O’Connor. “To be more specific, May’s sale totals of 27,850 existing single family homes and 11,538 existing condos and townhomes were the most ever recorded (by Florida Realtors) for a single month in either property type category. In both cases, these totals were also markedly higher than the very strong number of sales racked up in May of 2016.”

Inventory remained tight in May with a 4-months’ supply for single-family homes and a 6-months’ supply for townhouse-condo properties, according to Florida Realtors®.

According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 4.01 percent in May 2017; it averaged 3.60 percent during the same month a year earlier.

Florida Realtors® May 21, 2017