Florida’s Housing Market in 3Q 2020 Shows Strength Amid Pandemic
Pent-up buyer demand and record-low mortgage rates have been “driving factors” in Florida’s housing market in the third quarter
Florida’s housing market reported strong gains in the third quarter of 2020 even as the coronavirus pandemic continued, with more closed sales, rising median prices, more new listings, and more new pending sales compared to 3Q 2019, according to the latest housing data from Florida Realtors®.
Closed sales of single-family homes statewide totaled 89,562 in 3Q 2020, up 13.7% from the 3Q 2019 level; closed sales of condo-townhouse properties totaled 33,523, up 13.5% compared to 3Q 2019. Closed sales typically occur 30 to 90 days after sales contracts are written.
Quarterly data figures normally offer a good look into prevailing economic and market trends, according to Florida Realtors Chief Economist Dr. Brad O’Connor.
“On the heels of a weak spring buying season brought about by the COVID-19 pandemic, closed sales of existing homes surged throughout the U.S. in the third quarter of 2020, and Florida was no exception,” he says. “And while the release of pent-up demand from spring certainly played a major role in this resurgence, it’s likely that the most important driving factor has been the record-low mortgage rates we’ve been experiencing.”
O’Connor pointed out that closed sales of Florida single-family homes were up 13.7% year-over-year overall in the third quarter, but all-cash sales were only up 1.7%.
“It appears that owner-occupant buyers and investors alike seem to be taking advantage of these low mortgage rates,” he says. “Condos and townhouse sales, which were hit particularly hard in spring, made a strong recovery in the third quarter as well, rising by 13.5% year-over-year. Across the state, single-family closings were up year-over-year in all 22 Florida metro areas, while condo and townhouse sales only failed to rise in two metros.”
The statewide median sales price for single-family existing homes in 3Q 2020 was $299,900, up 13.2% from the same time a year ago, according to data from Florida Realtors Research department in partnership with local Realtor boards/associations. The statewide median price for condo-townhouse properties during the quarter was $215,000, also up 13.2% over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.
Supply and demand impacted home prices across the state, O’Connor notes. He explained, “Because new construction and new listings of existing homes are not keeping pace with the current rate of sales, we observed a substantial amount of home price appreciation in the third quarter.”
In 3Q 2020, the median time to a contract (the midpoint of the number of days it took for a property to receive a sales contract during that time) was 29 days for single-family homes and 46 days for condo-townhouse properties.
Inventory was at a 2.2-months’ supply in the third quarter for single-family homes and at a 5.1-months’ supply for condo-townhouse properties, according to Florida Realtors.
According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 2.95% for 3Q 2020, significantly lower than the 3.67% average reported during the same quarter a year earlier.
To see the full statewide housing activity reports, go to Florida Realtors Tools and Research section.
Source: “Fla.’s Housing Market in 3Q 2020 Shows Strength Amid Pandemic,” Florida Realtors