“It’s still a Buyer’s Market in South Florida and Broward County, right?”
This is a question that I’ve heard from a number of Buyers and the question is phrased as more of a statement than a question. The answer is that it’s not nearly as much of a Buyer’s Market as it used to be and in some areas it’s completely a Seller’s Market.
The balance is shifting!
Historically and statistically, it’s considered to be an average Market when Inventory is below 6 months. Months of Inventory are calculated based on how long it would take the current Inventory to be absorbed (absorption rate), based on the current number of completed Sales, without new Inventory coming on the Market. In an average Market, the scales are tipped rather evenly in the favor of Sellers AND Buyers. A Seller’s Market is considered to be when Inventory is below 3 Months.
In all of Broward County, within the Inventory of Single Family Homes, Condos, and Townhouses, Months of Inventory are currently at 6.1 months, so it’s not much of a Buyer’s Market across the County as a whole.
How does current Inventory in Broward County compare to supply during the peak of Boom and during the height of the Bust?
- At the peak of the Market, when we had the most sales, there were 3 Months of Inventory in September of 2005.
- At the height of the bust, when we had the lowest number of sales, there were 38.6 Months of Inventory in September of 2007.
- As of September 2011, Inventory is at 6.1 months. This decrease in Inventory is because of significantly increased sales, NOT because properties were just taken off of the Market. Here in South Florida, we’re entering our annual peak season for selling the most Real Estate (October – March), so Inventory is decreasing. In East and Waterfront areas, where we have the fewest properties, this news isn’t entirely positive because there’s insufficient supply to meet the current level of demand.
Real Estate is very specific to various Cities, Neighborhoods, certain price ranges, and many other factors, so it is important to note that supply varies significantly, depending on these factors. In some locations and price ranges, there’s much less than 6 months supply of Inventory and in some, there’s more than 6 months, but in most cases, there’s significantly less than there was during the height of the Real Estate Bust. In the price range under $200,000, for example, Broward County currently has only 4.6 months of supply.
Below is a Graph that depicts Inventory levels within the last 5 years, from September 2006 – September 2011.
- Current state of the South Florida Real Estate Market
- 6-Year Real Estate Report for Broward County
- September 2011 Broward Luxury Condo Market Report
- Broward 3rd Quarter 2011 Luxury Single Family Home Sales
- New Wave of Condo Towers coming to Miami
- Related’s Apogee Beach Oceanfront Condo to start construction in November