Real Estate Things to Know Dec 2023

2023 has been a challenging yet rewarding year for real estate in the St Petersburg area. The market has been tight on inventory all year and the highly competitive buyer activity at the start of the year tailed off in the second half as interest rate increases and inflation really started to bite.

The chart sums up well where we currently are, single family inventory is down slightly from this time last year, sales volume is down, but prices are up nearly 4%. There are now 2.7 months of inventory, vs 2.4 this time last year. High interest rates and inflation have made it more expensive for buyers, and sellers have wanted to

hold onto their low interest rate mortgages and have struggled to find somewhere to move to. This situation is not unique to the Tampa Bay area, and has been played out across the country where the number of sales is around 13% lower than it was last year.
The good news is that mortgage rates are now below 7% and the Fed has indicated that interest rates are likely to ease during next year as inflation comes under control. My speculation is that we’ll see more buyers become active early in the year, possibly straining inventory more, and later in the year moves to a signifucantly more balanced market.

Condos are feeling the pressure and inventory has jumped up from this time last year. One contributing factor has been the introduction of mandatory Milestone Inspections and SIRS. These new laws are aimed at ensuring condo buildings of 3+ stories and 30 years and older are structurally sound and have the funding in place to maintain major structural components. Some buildings are having to do unscheduled and unbudgeted repairs, and in some cases increasing monthly assessments and imposing special assessments. Some owners have rushed to sell and buyers are expressing more caution and doing more diligence when considering purchasing a condo. There are lots of advantages to owning a condo and there are lots of great buildings out there, just do your diligence if you are considering purchasing one!