Sinking Home Sales In the Jacksonville Market
According to data provided by the Northeast Florida Association of Realtors there were 1652 on market home sales in the Jacksonville MSA in January of 2023. A Far cry from the 3395 sales in June of 2022, when interest rates were just beginning to creep upward from the historic lows of late 2021.
This sharp decline echoes a national trend in diminishing home sales, with more expensive metros suffering the greatest decrease. A report from the National Association of Realtors published Tuesday February 21, 2023 indicates that on a national level, sales have fallen for 12 consecutive months, the longest streak on record since reporting began in 1999. In addition, that same report indicated that sales activity is the weakest it has been since 2010, when the country began to see significant recovery from the 2008 real estate crash and subsequent recession.
But what does that mean for homeowners in Jacksonville? Especially those that are currently in the process of selling, or expect to become sellers within the next 3-6 months.
A stronger metro with reasonable pricing
It’s not all doom and gloom. Despite the undeniable slowing of home sales in the Jacksonville MSA, there are some indicators of a stronger local market. In fact home sales actually rose in December month over month from November of 2022. And it’s not the only time in the 12 month window discussed by NAR in which the local market has deviated from the national trend. Sales volume also increased month over month in February, March, May, June, August, and October of 2022.
The reason? Pricing. As Chief Economist for NAR Lawrence Young had put it “Home sales are bottoming out. Prices vary depending on a market’s affordability, with lower-priced regions witnessing modest growth and more expensive regions experiencing declines.”
While increasing rates and home values have affected affordability, pricing out many of the would be first time homebuyers that attempted to enter the highly competitive markets of 2021 and early 2022, Jacksonville and its surrounding suburbs remain one of the most affordable up and coming metro areas in Florida, and Jacksonville been rated as one of the strongest national Metros by Zillow for 2023. As a result home sales have continued, and inventory remains limited overall.
Competition is good for sellers
While we aren’t seeing the bidding wars that were common in the latter parts of the market frenzy, the volume of available homes in the market is driving competition between buyers. As of February 2023, the number of available residential homes listed on the NEFMLS is down to 5875, a 22% decline month over month. While this is partially driven by owners who wish to hold out for a more aggressive market, many owners are simply unwilling to give up favorable mortgage terms locked in during the 2020-2022 period. As such, willing and able buyers are finding that their options are limited, and the choicest homes in the most desirable neighborhoods are highly competitive. And this competition is a good thing for those thinking of selling.
Competition drives prices up as multiple bidders compete to offer the most favorable terms in hopes of winning the sale. In turn, those higher dollar sales increase neighborhood comparable values, which real estate agents use to price their listings. It’s a flywheel effect, and one that would be seller’s should be eager to capitalize on.
The elephant in the room
If inventory remains tight, and values continue increasing, seller’s shouldn’t be concerned right? Unfortunately, there’s more to the equation. Remember when we said “choicest homes”? Not every home is a shining gem. Some lack curb appeal, flow, or need updating. Others have bad neighbors, are tenant occupied, or even need major repairs. It’s owners of these homes that should start to feel some unease.
Homes with less desirable characteristics spend more time on the market, often without much interest or many bonafide offers. Price cuts for these homes have become more common, creating competition between would-be sellers, instead of buyers. This competition, while healthy for buyers looking for affordable housing, hurts home values in these areas in the long run.
Additionally, the longer a home sits on the market the greater the holding costs become. Fees for services such as staging usually run a flat rate for a set period, before occurring additional expenses. Combined with monthly mortgage, insurance, utility, and tax bills, every additional day a home spends on the market lowers your bottom line.
How to make your home more desirable
There are steps that can be taken to help a home show better once it’s listed. Staging and professional photos are almost a requirement in the current market. Ensuring that the first impression a buyer’s agent has when viewing your listing online is a positive one greatly increases the chances of them booking a showing for their client.
Regular cleaning, even for vacant homes is also a must. Most buyers will only have a few moments to determine if your home is a good fit for them. Don’t miss an opportunity to find a buyer because a bit of dirt turns them off.
Lastly, consider other homes that have recently sold in your area. Are they more updated than yours? If so, you may consider making some improvements before putting your home on the market. Kitchens and bathrooms are a good place to start, but landscaping and exterior improvements can also make a home stand out, which gets potential buyers in the door.
What to expect for my Jacksonville home
We don’t have a crystal ball, but if the current trends continue it may be a rocky year for real estate in the Bold City, albeit significantly less tumultuous than many other markets in the country. Expect to put in some additional work if you want your home to sell, and don’t be surprised if you have to subvert your expectations around your sales price. It’s still possible to get a great offer from a buyer, but it’s become the exception instead of the rule.
The Duval Home Buyers Way
Duval Home Buyers offers an alternative to listing: an all cash offer. In exchange for a slightly lower offer price, you can skip the cleaning, repairs, showings, staging, and other hassles that come with selling a home, especially in a turbulent market. You’ll also save on real estate commissions and fees, which when combined with a prompt and secure closing, can result in higher earnings from your sale. Our agents are fully licensed, and would be happy to discuss your options to recommend your best course of action based on your unique situation. If you need to sell your house fast in Jacksonville, Florida, we’d love to help.