Florida Home Prices Rise, Despite Waning Investor Condo Interest

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According to the Florida Realtors, Florida's housing market reported rising median prices and increased inventory in July 2014. Closed sales of single-family homes statewide totaled 22,099 last month, up 5 percent over the July 2013 figure.
 
"Florida's housing market continued its steady pace in July," said 2014 Florida Realtors President Sherri Meadows. "Median sales prices rose year-over-year for both single-family homes and townhouse-condo properties in July - marking 32 months in row for higher median prices. Statewide, inventory (active listings) for single-family homes last month rose 17.5 percent year-over-year, while the townhouse-condo inventory of active listings rose 10.9 percent."
 
The statewide median sales price for single-family existing homes last month was $185,000, up 3.6 percent from the previous year, according to data from Florida Realtors Industry Data and Analysis (IDA) department. The statewide median price for townhouse-condo properties in July was $137,500, up 7.4 percent over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.
 
According to the National Association of Realtors (NAR), the national median sales price for existing single-family homes in June 2014 was $224,300, up 4.5 percent from the previous year; the national median existing condo price was $215,700. In California, the statewide median sales price for single-family existing homes in June was $457,160; in Massachusetts, it was $365,000; in Maryland, it was $284,553; and in New York, it was $229,000.
 
Looking at Florida's townhouse-condo market, statewide closed sales totaled 8,984 last month, down 6.7 percent compared to July 2013. The closed sales data reflected fewer short sales last month compared to the previous year: Short sales for condo-townhouse properties declined 61.1 percent while short sales for single-family homes dropped 54.8 percent. Closed sales typically occur 30 to 90 days after sales contracts are written.
 
Florida Realtors Chief Economist Dr. John Tuccillo said, "The July numbers look very much like June's when each is compared to the prior year. This tends to verify our preliminary view that the market is settling into a stable pattern. I'm asked a great many times about the 'new normal,' meaning how the Great Recession changed the housing market. We are now beginning to see that the 'new normal' is really the 'old normal' with statistical patterns reminiscent of the market that prevailed prior to the frantic run-up of prices.
 
"The only troubling area is condo sales. The declines here, coupled with the sharper declines in condo cash sales, suggest waning interest on the part of investors. This is an area that will bear watching."
 
Inventory was at a 5.5-months' supply in July for single-family homes and at a 5.7-months' supply for townhouse-condo properties, according to Florida Realtors.
 
According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 4.13 percent in July 2014, down from the 4.37 percent average recorded during the same month a year earlier.