Spring is traditionally considered the real estate market’s busiest season, even in Florida where we enjoy sunnier weather all year long. However, unprecedented demand and a shortage of housing inventory have made every time of year feel like the spring market. It is understandable if you are hoping to purchase a new property and feel discouraged. However, there are steps you can take to rise above the competition as you search for your new home.
To illustrate the present market, we can look at single-family home sales in 2022 compared to 2021. According to Florida Realtors, there were 31, 658 homes available for sale throughout the state in March 2021. In March 2022, there were 28,436 active listings, a 10.2% decrease in available homes. Six months of inventory is considered normal in a balanced market, but there were only 1.2 months in March 2021 and one month in March 2022. The median sale price for a single-family home in Manatee and Sarasota counties was $500,000 in March 2022, a 29.9% increase over the previous year.
How does a potential buyer compete in an environment where multiple offers are a frequent occurrence? Ryan and Barbara Ackerman, leaders of the award-winning Ackerman Group at Coldwell Banker Realty in Longboat Key, offer these three tips to help buyers succeed in purchasing their next home in Florida:
1. Be preapproved, not just prequalified: As interest rates inch upward, it is creating even more of a sense of urgency for home buyers to act sooner than later. Any price range under $1 million tends to be more sensitive to mortgage rate changes. The Ackerman Group says if you need financing, it is important to get all your ducks in a row before bidding on a home. Prequalification from a lender is an early step that offers an estimate of what you might be able to afford. But a “preapproval letter” provides more verification of available credit to purchase a home, an important, time-saving step in an environment where these decisions happen quickly.
2. Consider which contract you choose: The Florida Bar and Florida Realtors have created “FAR/BAR” contracts for use in real estate transactions. There is both a 1.) standard contract and 2.) an “As Is” contract, the latter placing fewer responsibilities on the seller, including repair obligations, and being more favorable to the buyer. According to The Ackerman Group, most sellers are currently giving preference to or requiring buyers to submit offers on a standard FAR/BAR contract and perceive those buyers as being more committed to the transaction, with it helping to ensure a speedier sale. Keep in mind that many sellers are hoping to secure funding so they can act quickly in making their own next move. As always, each buyer should carefully consider their own circumstances and needs when deciding what to waive or retain in a contract negotiation.