JACKSONVLLE, Fla. – The red-hot housing market seen last year in Northeast Florida is a thing of the past.
New data released this week by real estate brokerage Redfin shows home purchases in Jacksonville fell through at a higher rate than anywhere else in the country last month.
About 30% of purchase agreements in Jacksonville were canceled in October. It was the second straight month that Jacksonville had the most in the country.
Northeast Florida experienced a huge pandemic-fueled boom in housing prices last year and thanks to low mortgage rates and thousands of people flocking to the state. But home purchase cancellations and other metrics show that’s no longer the case.
Jacksonville saw the biggest year-over-year increases in the share of homes for sale with price drops last month, according to Redfin data.
Northeast Florida Association of Realtors (NEFAR) President Mark Rosener said deals falling through has a lot to do with new home construction and rising mortgage rates.
“A lot of these folks went under contract nine months ago, a year ago, when interest rates are very different today than they were then. And so their payment that they were looking at nine months ago is not the same,” Rosener said.
Rosener said overall, he’s seen a slowdown in the housing market locally in recent months.
“So one of the cautions that I’ve done over the last couple of months is comparing this year’s stats, to 2021, and to 2020, because those two years were atypical. It was such a crazy market, we knew it would not be sustained,” he said.
Rosener said the housing market is beginning to look like it did back in 2019 when things were more “normal.” He said that’s good for buyers and sellers.
“Today, properties are staying on the market a little bit longer. There’s more to choose from. So from a buyer standpoint, there’s some advantages there,” Rosener said. “From a seller’s standpoint, it’s less stressful. Even from a seller’s point of view, a multiple offer situation, it’s stressful.”
Looking at NEFAR data for six Northeast Florida counties, the median sales price for a single-family home was still 14.5% higher than last October at more than $383,000, but houses are becoming more affordable for buyers.
Rosener said it’s still a “seller’s market” but things could stabilize by the end of next year.
“Typically, real estate economists will say, a five to six-month supply is a balanced market. It’s neither a seller’s or a buyer’s market. Currently, we’re in about three month supply, which would indicate that we’re still in a seller’s market, but all things are relative. This seller’s market is very, very different than it was back in April, March, February of this year and all of last year,” he said. “Probably by the end of 2023 we will be in a balanced market.”
Inflation is beginning to cool, and Redfin said buyers may return to the market if the trend continues.