Last month, the economic impact of coronavirus pandemic hit Florida’s housing market hard, according to a report from the Florida Realtors.
The Florida Realtors released housing data on Thursday and found “lower levels of closed sales, pending sales, new listings and other metrics compared to a year ago – except for median sale price, which rose compared to April 2019.”
Florida Realtors President Barry Grooms, a realtor and the co-owner of Florida Suncoast Real Estate in Bradenton, weighed in on the numbers.
“The impact of COVID-19 on Florida, the U.S. and throughout the world was fully realized in April,” said Grooms. “Many businesses shut down as people sheltered in-place to protect themselves and their loved ones, following the governor’s stay-at-home order and recommended health practices. Job losses rose and unemployment claims overtaxed the state’s system. It’s no surprise that many buyers and sellers put their plans on hold for now, because of the pandemic and the current economy.
“As Florida continues to reopen businesses and activities in phases, we continue to follow social distancing and health guidelines to protect ourselves and our communities. People still need a place to call home, and Realtors in every community stand ready to help buyers and sellers who need support and guidance in these uncertain times,” Grooms added.
Closed sales of single-family homes across the state in April dropped 20.7 percent compared to April 2019 while condo-townhouse sales fell 36.5 percent over that period. Still, there was a quantum of good news.
“In April, the statewide median sales prices for both single-family homes and condo-townhouse properties rose year-over-year for 100 months in a row. The statewide median sales price for single-family existing homes was $275,000, up 6 percent 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 $209,000, up 7.7 percent over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less,” the Florida Realtors noted.
Florida Realtors Chief Economist Dr. Brad O’Connor also found other good news including the “median sale price continued to rise in April for both single-family homes and condo-townhouse properties, signaling that home values are generally holding firm – a trend that’s in line with what basic economic theory would predict when there are offsetting declines in both demand and supply.”
“Looking ahead to May, all indications are that we will continue to see stable prices but will see a further decline in closed sales,” O’Connor said. “New pending sales for April were down over 35.1 percent in the single-family category year-over-year, and they were down 56.6 percent in the condo and townhouse category. However, the silver lining is the majority of this drop occurred in the first couple weeks of the month. In each week of the second half of April, we saw drastic improvement in the number of homes going under contract.
“The trajectory of this improvement has been strong enough, that preliminary data points to the possibility that we could see positive year-over-year growth in new pending sales in several markets across the state in May – particularly for single-family homes. What’s more, there’s a lot of current housing market data across the U.S. that points toward this being a national trend,” he added.
O’Connor also pointed out that the “Mortgage Bankers Association (MBA) has been reporting robust increases in the number of loan applications submitted for U.S. home purchases” before focusing on other numbers.
“Another metric that showed improvement over the course of April was new listings,” O’Connor said. “Overall for the month, new listings were down over 27.2 percent year-over-year in the single-family category, while new listings of condos and townhouses were down 38.5 percent. Again, though, like new pending sales, the pace of new listings was slowest in the first two weeks of April, after which it started to recover. This recovery in the pace of new listings was not as strong as what we saw for new pending sales, though – so we appear to be, for now, in a situation where demand is rebounding a bit faster than supply.”
Freddie Mac found the interest rate for a 30-year fixed-rate mortgage averaged 3.31 percent last month compared to 4.14 percent in April 2019.