“The Sky is falling.” Chicken little’s fairy tale is much like many of today’s media headlines. They contribute to consumer confusion and doubt about what is happening in the real estate market. The story is synonymous with alarmism, and one can summarize the message or moral as; don’t form an incorrect conclusion from insufficient data and don’t stoke fear in others without a good cause.
While putting together this article, I went back to last year’s November issue to see what was discussed then. The main news then was Zillow’s decision to get out of the I-buying program, which many thought would be the start of the real estate correction and crash. We were not in that camp of thought then or even now. However, I did make a couple of predictions based on the data. One was that we would have another 12-24 months of a sellers’ market or until we reached three months of inventory supply, and I didn’t think we would have another strong 20 percent growth in property values in the coming year.
Zillow did get out of the I-buying market, and its stock price has tanked more than 68 percent since they announced the change. The inventory supply has increased from 0.88 to 2.32 months, not quite at the 4–6-month equilibrium yet, but it has only been 12 months; sellers still have a slight advantage over the buyers. As for the property values, our Plant City market appears to have peaked in May-June this year, but in October’s year-over-year numbers, we have seen a 26 percent increase over the last year-to-date numbers. The anomaly is the government maintained interest rates artificially low for far too long and caused the surge in property values, amongst many things, and now trying to correct their original miscalculation by raising the rates steadfastly, resulting in other economic issues.
It needs to be said, Supply Demand economic models will correct themselves over time without government assistance. There is another agenda involved with all the other interference, which is an entirely different subject matter. Plant City’s real estate market is sound; yes, while some changes will affect parties differently.
As we look at the Plant City housing data, in October 2022, our market area sold 92 homes, about a 77 percent increase from the previous month and year-to-date down 9.2 percent. 26 percent of this month’s increase came from new construction and will likely continue to see growth from those areas’ developments.
The average selling price per square foot was $196.72, which accounted for a 5.1 percent reduction over last month but compared to the year-to-date average, it accounted for only a 1.6% decline. The average selling price was $373,429 in October or a 3.9 percent upturn over last month, and YTD, the average, amounts to a 3% gain. Now it’s hard to define the exact trendline, but our market peaked in May/June and has started to decline slightly. We will finish the year with an average price per square foot in the $200 range, which amounts to a 20-22 percent increase over last year.
The active inventory increased slightly this October to 2.32 months’ supply from 2.3. However, we are still 6-12 months from the equilibrium of three months’ supply levels.
Comparing the Median prices month over month data, October finished with a median sales price of $349,995, which was 2% more than in September and a 3.2 percent increase year-to-date. In addition, October’s average days on the market (ADOM) was 32.5 days, an 11 percent increase over last month. Before the market surge, we typically averaged 45 days on the market.
What does the near future hold for our real estate market? It depends on whether you have a “Chicken Little” attitude or the market is stabilizing viewpoint. In the ensuing few months ahead, many lenders may still have an alarmist attitude but will discover the mortgage rates will correct themselves by the second quarter of 2023, and we will see rates in the mid 5’s range again. The average sales price growth will be flat in value.
If you are in the market to buy or sell your home, seek an experienced professional Realtor® to assist you in this transaction process. There are too many consequences, going it alone without proper representation. If you have any questions, want a market value analysis of your home, or see what’s available to purchase, please reach out.
M Crawford Crawford Group Sales Snapshot
The following residential properties were a sample listed as sold on the Greater Tampa Realtors Association MLS in October 2022 for the Plant City Market Area.
The home at 2302 Maki Rd, Unit 24 sold October 7 for $151,500. Built in 1987, it has 2 bedrooms, 1.5 bath and 896 square feet of living area.
The home at 109 S Gordon St sold October 19 for $215,000. Built in 1961, it has 3 bedrooms, 1 bath and 1092 square feet of living area.
The home at 418 Pevetty Dr sold October 4 for $224,000. Built in 1956 it has 3 bedrooms, 1 bath and 1138 square feet of living area.
The home at 2053 Greenwood Valley Dr sold October 11 for $245,000. Built in 2008, it has 3 bedrooms, 2.5 bath and 1632 square feet of living area.
The home at 901 N Clark St sold October 14 for $270,000. Built in 1912, it has 4 bedrooms, 2.5 bath and 2324 square feet of living area.
The home at 702 E Gilchrist St sold October 26 for $295,000. Built in 1928, it has 4 bedrooms, 2 baths and 1516 square feet of living area.
The home at 2762 Golf Lake Dr sold October 7 for $334,000. Built in 1996, it has 3 bedrooms, 2 bath and 1810 square feet of living area.
The home at 1402 Tahitian Sunrise Dr sold October 31 for $349,990. Built in 2022, it has 4 bedrooms, 2 baths and 1936 square feet of living area.
The home at 4301 Barret Ave sold October 11 for $368,420. Built in 1999, it has 4 bedrooms, 2 baths and 1808 square feet of living area.
The home 3453 Silver Meadow Way sold October 13 for $397,500. Built in 1993, it has 3 bedrooms, 2 baths and 1852 square feet of living area.
The home at 2006 Berry Rd sold October 11 for $430,000. Built in 2017, it has 4 bedrooms, 3 baths and 1982 square feet of living area.
The home at 6610 Papa Guy Ln sold October 7 for $450,000. Built in 1988, it has 4 bedrooms, 2 baths and 1740 square feet of living area.
The home at 5205 Five Acre Rd sold October 26 for $500,000. Built in 1968, it has 4 bedrooms, 2 baths and 2197 square feet of living area.
The home at 2918 Spring Hammock Dr sold October 12 for $667,000. Built in 1999, it has 4 bedrooms, 3 baths and 2651 square feet of living area.
The home at 1716 Charleston Wood Ct sold October 26 for $1,950,000. Built in 2021, it has 5 bedrooms, 6.5 baths and 5575 square feet of living area.