There are some really great reasons and opportunities to buy a home today that I wanted to share with you.
Let’s start by talking about what the multiple offer scenarios were 6-8 months ago and before. You and I know how competitive the market was. If you were an active buyer, you were competing against so many families, doing big lines to see a property and so many irregular things because of the huge buyers demand, low interest rates and low supply.
In the chart below, you can see the average of multiple offers received in April, May and June of this year.
For example, the average offer for a home in April was 5.5, 4.2 in May and that it fell to 3.4 in June. This means the people who got outbid earlier this year have a lot of opportunity in today’s market. It is predicted that we are going to continue to see this based on the pace of the market.
Next is fewer homes selling above asking price. You can see that it moved from 61% of homes selling over asking price in April, down to 51% in June.
I need to mention right here that 51% is still a really competitive market , it’s still a huge percentage. A lot of properties are still selling above asking price and you need to be prepared. What I am trying to say to you is that even though it is still competitive in certain areas in Miami, it is not quite as impossible as before or the previous year.
Moving on, another great news for the buyers is that the supply for homes for sale is growing. We are indeed seeing more new listings coming to the market and homes are staying on the market for a bit longer showing clear signs of growth in supply. I recently did the latest Miami housing update which I am going to leave right here for you to see the most recent data and local numbers deeper. So indeed, more options to choose from.
In the chart below shows that in April the national supply was at 2.2 which gradually increased from 2.6 in May to 3.0 in June. And in this graph, it shows our total months supply inventory. As you can see for the last 4 months now, the market does have a trend of getting more inventory.
Here is another graph, I wanted to put for you with the single family homes. Again, the increasing trend from 1.9 in April to 3.1 in July.
Lastly, this one which is the condo one from 2.3 in April to 3.3 in July.
Definitely, this rise in housing supply would provide individuals additional options to choose homes and eventually less and less competition.
Another reason to buy a house is the rapid increase in the rents compared to which buying a home is cheaper. What I mean by this is that mortgage rates are mostly fixed throughout the duration of the loan, but rents, increase every year.
This chart here shows an example of a mortgage price that is fixed on $1,842 monthly for all types of housing but the rents are different for every type and the overall ratio monthly rent stands on $1,849 that is still a bit higher than the mortgage rate.
In Miami Dade County, the median rent price for single family homes in August 2022 was $4,000 and for condos/townhomes $3,000 so let’s calculate that. $3,000 x 12 = $36,000 and $48,000 that you can potentially be putting as an investment for you and your family.
We have been seeing rent increases of 20%, 30%, even 50% in some areas in Miami. That’s crazy.
Some of you are thinking of waiting until the prices go down and here is a quote from David Ramsey: “Right now is the best time to buy a house in the next five years…Prices are not going to go down.” Prices are not coming down in the near future.
You have more probabilities of getting equity than the prices going down.
If someone buys a home now and stays in it, the property will increase in value and you can potentially be able to sold it for a high price in the future.
Here is the latest 2022 home price appreciation compared to early January that many experts like Fannie Mae, Freddie Mac, NAR, Zelman, etc raise the home price forecasts.
This was the latest updated quote by Black Knight which shows that the annual home prices growth have dropped with two percentage points showing to be the greatest slowdown compared to early 1970s.
If you are thinking about buying or selling in Miami, CLICK HERE or you can call me at 786-376-2398.
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