I'm a Realtor Real Estate Broker specializing in the Palm Beach Florida real estate housing market twenty plus years and I'm keenly aware of the current housing shortage, which has led to a softening of home sales due to escalating prices. With winter approaching, there's an anticipated surge in demand in the Southeast Florida region. It's evident that Florida urgently needs a substantial increase in inventory. The real estate market is seeing a steady rise in interest rates, with long-term mortgage rates hitting 7.57% this week. Despite these challenges, buyers do have some leverage, especially with mortgage companies that have available funds but a shortage of applicants. Current homeowners are cautious about selling to avoid losing their favorable interest rates. Additionally, sellers looking to upsize or downsize are struggling to find suitable replacement homes.
The real estate market is currently facing significant challenges. The combination of high mortgage rates, low inventory, and the reluctance of current homeowners to sell is creating a complex situation. While it's difficult to pinpoint exactly when the market will shift, there's potential for some changes next year. Although home prices have remained resilient this year, the volume of home sales has noticeably decreased.
In July 2023, existing-home sales dropped to an annual pace of 4.07 million homes, marking a 16.6 percent year-over-year decline according to NAR data.