2023 First Quarter Tampa Bay Real Estate Trends
Homeowner sales continue to slow in Florida. Last year ended with sales 20% below the prior year (which was a record year) with the first-half sales coming in strong while the second half dropping significantly. We expect sales to settle around the levels we experienced in 2019 before the pandemic. We are seeing a better balance between buyers and sellers, reducing the frenzy of buying a home with multiple offers.
Inventory at the end of December 2022 was 80% of December 2019 levels. This compares favorably from the beginning of 2022 when homes for sale were only 26% of January 2019 levels.
December home sales were 38% below what we experienced this time last year. We anticipate seeing sales at this level for the first several months of the current year. There is some momentum growing in the market as buyers continue to move to Tampa Bay from the northern and western states.
Average home prices in Hillsborough and Pinellas Counties are 6% below the peak of July 2022 but still represent a 7.8% increase over the previous year. Existing homeowners still have significant equity in their homes which will make the move to a new home easier.
Finally, interest rates remain the biggest influencer in the market right now. However, there does appear to be some relief for buyers on the horizon as we are seeing a downward trajectory of the rates. The average 30-year mortgage rate dropped to 6.15% the week of January 26th, 2023. This is the lowest rate we’ve seen in the last four months.
Tampa Bay remains a very desirable place to live, work, and play. We have great weather, a vibrant economy, a great tax structure, a favorable business climate, and friendly people which continue to bring more and more people into the area. All of that is good news for all things relative to real estate.
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