The dog days of summer have some buyers on hold.

The median price of single-family homes in Northeast Florida inched up 1.3% to $395,000. July finished with closed sales of single-family homes down nearly 20% from June.

“Interest rates, the cost of goods and services, and available supply are all factors in the decline in closed sales,” said 2023 NEFAR President Diana Galavis.

Galavis also attributed the slowdown to the 30-year-fixed interest rate, which has increased and pushed median monthly mortgage payments higher. “This reflects Northeast Florida’s home affordability index rate registering at 65, which is down 3% from last month and 12% from last year,” she said.

By falling 3% to 65, Northeast Florida’s Home Affordability Index is registering at its lowest point ever. The Housing Affordability Index measures housing affordability for the region. In other words, it measures 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.  This index measures affordability factors for all homebuyers making a 20% downpayment. An index of 100 is defined as the point where a median-income family has the exact amount of income needed to purchase a median-priced existing home. An index value over 100 means that the family has more than enough income, while a value below 100 means that a family doesn’t have enough income to qualify for a mortgage loan.

Meanwhile, sellers are pricing homes according to the market, and with advice from REALTOR^® experts they are receiving almost 98% of their listing price, said Galavis.

New listings in the region remained steady at 2,952 and active inventory increased 6.9% to 4,845 homes. The months’ supply of inventory in July skyrocketed and is now 33.3% higher at 2.7 than it was from the previous month when it registered 2.0.

“Many people are looking to buy, invest, and move to Northeast Florida, and this is reflected with the months’ supply of inventory,” Galavis said. “There are more buyers in the market than there are homes. 

“Even with increased housing costs due to higher interest rates, insurance and inflation, many buyers understand that homeownership provides a pathway to long-term wealth,” she continued.  “In a highly fluctuating market, it is important to seek out a REALTOR^® to provide the professional advice needed for the purchase and sale of real estate.” 

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