NEFL August Market Report

Well folks, it sure has been a busy few weeks. The proposed NAR settlement went into effect at the end of last month, and on Wednesday the Fed voted to reduce rates by half a percent, the first cut in 4 years. Mortgage rates have fallen to the very low 6s and look to potentially fall back into the high 5s before year’s end. With hints of further rate cuts to come, there may still be time for the real estate market to warm up before the holiday season begins in full. 

Despite this optimism, the August numbers paint a more complex picture. On the national level, the number of existing home sales took a steep dive, falling 2.5% month over month. That makes it the slowest August for sales since 2010 according to NAR. However,  the median price of an existing home rose 3.1%, marking the 14th consecutive year over year increase for August home prices.  

But what do things look like here in our own backyard? Well, let’s dive into the numbers! 

Pending & Sold

Please bear in mind that this data is not finalized. Some listings may close or pend late, and as a result the data may change slightly. 

According to data provided by NEFAR the number of sold listings fell by 6.1% month over month, and by 7.9% year over year. Homes in the $300k-$500k range, which made up 39% of all sales in Northeast Florida, fell by an even greater 12.8% year over year, while homes in the $250k-$299k range sold at a greater rate, up 4.2% year over year. 

Pending sales, though not definitive, offer a glimpse into the market’s future. In August, pending sales dropped sharply by 20.3% year over year, although some homes under contract but awaiting contingencies might still appear as active listings.

 

Sales & Listing Price

The average sale price for listed homes on the NEFMLS rose 1.49% year over year, but fell 5.7% month over month. The average listing price in Northeast Florida was $533,018, a .34% decrease from $534,817 in August of 2023. 

The sold to list ratio, the average ratio of sale price to original list price expressed as a percentage, fell month over month from 94.8% in July to 94.1% in August. 

Overall, prices have remained mostly stable, with sellers willing to take a little less than asking in order to move a difficult property. Bidding wars are also less common, with many sellers offering concessions, even when selling under list price. It’s not a buyer’s market yet, but buyers are starting to get a better hold on negotiating power. 

Inventory

Housing supply has been a hot ticket topic in the media ever since the start of the COVID-19 pandemic. A surge of new buyers in 2020 and 2021 nearly drained the nation of available housing inventory. Bidding wars drove up prices, leading to some of the current affordability issues facing buyers.  But in recent months housing inventory has begun to rebound. June saw residential inventory at the local level break 10,000 units for the first time since the pandemic began, easing some of the supply burdens facing buyers. 

Sellers, on the other hand, have felt some concern as lower than expected sales volumes and greater numbers of active listings have made competition fiercer, and some less desirable homes have sat stale in what would have been an otherwise hot market. 

August has seen a slight reversal of this trend, with housing inventory dropping to 10,451 units from 10,535 units in July. Though it’s worth noting that August’s 10,451 is still a 31.8% increase year over year. 

The number of new listings also fell between July and August 2024, down 8.4% month over month. Year over year, the number of new listings was up by just under a percent. Many sellers may be holding off until 2024, anticipating further rate cuts that could energize the market. 

Other Considerations

Homes are still selling far faster than they did pre-pandemic, with the average CDOM or cumulative number of days on market at 65 as of August 2024. While this is a slight increase from July, it’s drastically better than the 75 day average of February 2024. 

And of course, there’s still an adjustment period to be had from the recent NAR rules changes, which shifted the responsibility of paying a buyer’s agent off of the seller and onto the buyer, in an effort to promote greater industry wide competition and transparency. Sellers have already begun to offer some concessions to buyers in the hopes of offsetting the new cost burdens, but it may be a few months before the effects are fully realized. 

Final Takeaways & Thoughts for Investors

At the end of the day, all signs point to mortgage rates dropping by a respectable percentage over the next 12 months. As rates become more competitive and cost burdens ease, more previously “locked-in” sellers may start to consider selling. However, if costs decrease too much, there’s a good chance that a massive influx of new buyers, similar to that seen in 2020, could again cause inventory shortages, adding upward pressure to pricing. 

If you are considering investing in or around Jacksonville, it’s worth taking into account the multitude of pushes towards better city infrastructure, including the development of a new stadium in an effort to revitalize downtown. Jacksonville is also a major center for healthcare, fintech, and logistics, all of which offer high paying employment opportunities. With the cost of living in the area well below that of other major metros, a small adjustment in the costs of borrowing may be enough to grease the wheels on this otherwise flat market. 

In summary, while we’re optimistic about Jacksonville’s market fundamentals—especially given the city’s growing industries and affordability—the current market data hints at some uncertainty in the months to come. The outcome largely hinges on how rates and buyer activity respond to these macroeconomic changes

Data provided by Northeast Florida Association of Realtors ® ️ and FlexMLS monthly market summary. Views and impressions are the author’s and may not necessarily reflect those of Wholesale Realty and its principals, agents, or brokers. This information is intended for entertainment purposes only. Buying and Selling real estate involves risk, and you should always speak with a licensed professional prior to making any real estate decisions.