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Housing prices become less affordable as the cost of homes stabilizes in region

November 15th, 2022 · Leave a Comment

As can be expected in a marketplace marked by low inventory, inflation, and climbing interest rates, prices in Northeast Florida’s housing market remained high as they continued to stabilize at the beginning of the holiday season.  And while closed sales increased in October, which is unusual at a time when buyers and sellers turn their attention to end-of-the-year festivities, all other housing metrics point to a massive shift in the market as the new year approaches.

The median price of homes in Northeast Florida’s single-family market rose 1% in October, settling in at $383,500. Closed sales rose 12.4%, however it is important to remember that many homes went under contract just as the mortgages began to climb in September. Houses spent more time on the market, increasing to a median of 39 days, an 8.3% increase from the month before. New listings increased 23.5% and active inventory rose 19.1% to 5,664, which is somewhat higher than during the pandemic but low by historical standards. October registered a 3.1-month supply of inventory.

Meanwhile, homes in the region became less affordable. October’s home affordability index sank 8.8% to register at 62. The index measures housing affordability for the region, by measuring whether a typical family earns enough to qualify for a mortgage on a typical home, based on current interest rates, median income, and median home prices.  A higher number means greater affordability.

“As expected, the real estate market continues to stabilize, as we close out the month of October and move into the holiday season,” said 2022 NEFAR President Mark Rosener. “This year has been a bit of a bumpy ride navigating through the end of the pandemic, the rise of inflation, the mid-year elections, and the rise of interest rates.  The combined single family, condo, and townhouse median price has fluctuated between $350,000 and $375,000 since March 2022 in the Northeast Florida Association of REALTORS®’ six-county area settling in at $359,990 at the end of October.”

In the Northeast Florida combined single-family, condo, and townhouse market, closed unit sales rebounded 12% after the 24.8 % decrease in September due to Hurricane Ian.  Pending Sales fell by just 2.6% in October compared to September in line with the historical seasonality of home sales in the fourth quarter.  The median days on market increased 8.3% to 39, new listings increased 21.7% to 3,898 units, active inventory rose 18.7%, to 6,805 homes, and months of supply rose 6% to 3 months.

NEFAR’s market reports are available at nefar.com.

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