US new housing starts hit 6-month high
U.S. new-home construction unexpectedly surged in November to a 6-month high, benefiting from a dearth of existing houses on the market and suggesting the crunch in residential real estate is easing. Mark Rayfield, Saint-Gobain North America CEO, says they are still optimistic about the market.
Bloomberg
The Treasure Coast’s single-family home inventory rose by 12% in January over the month, reaching levels last seen in early 2020 after the pandemic began.
With over 3,500 homes available for sale in January, the market is on track toward normalizing after reaching record lows during the pandemic because of high demand for homes, spurred by population growth and low interest rates.
Closed sales declined in January over the month due to lack of affordability and high interest rates in the last quarter of 2023.
The median sale price remained stable and only increased marginally across the region.
Active listings
Active listings rose 11.51% from December last year to 3,565 in January.
- Indian River: 1,036, up from 888 in December
- Martin: 636, up from 590 in December
- St. Lucie: 1,893, up from 1,719 in December
These are comparable to early pandemic levels seen between March and July 2020.
This also reflects the seasonality of the market as more homes are listed in the beginning of the year, said David Serle, president of the Broward, Palm Beaches & St. Lucie Realtors.
Inventory has also been increasing over the year.
“We’ve seen 16% increases year over year for inventory,” Serle said.
Inventory on the Treasure Coast decreased during the pandemic after a rapid influx of people and low-interest rates led to increased home sales.
It hit its lowest level in January 2022, with only 1,105 homes across the region for sale. Barring seasonal fluctuations, it has steadily increased since as the market gradually normalized.
The Treasure Coast’s population grew by an estimated 6.27% between April 2020 and July 2022, according to the U.S. Census data and estimates.
- Population in April 2020: 647,445
- Population in July 2022: 688,062
Mortgage rates during this period were between 2% and 4%, according to Freddie Mac’s mortgage survey.
New Listings
There was a 58% increase in new listings on the Treasure Coast, with 1,366 new homes for sale in January. This trend was seen across the state.
- Indian River: 371, up from 221 in December
- Martin: 254, up from 153 in December
- St. Lucie: 741, up from 491 in December
“We find ourselves with inventory levels much more comparable to pre-pandemic levels than we had over the last couple of years,” Brad O’Connor, chief economist for Florida Realtors, said on Feb. 22.
The new listings on the market should help maintain stable home prices, O’Connor said.
“Affordability remains a challenge, but the extra inventory we have now should help to keep further price growth in check for the time being,” he said.
Closed sales
Closed sales declined over January 2024, reflecting low affordability due to high-interest rates in the last quarter of 2023:
- Indian River: 156, down from 181 in December
- Martin: 107, down from 128 in December
- St. Lucie: 283, down from 384 in December
Sales have declined since mid-2023, after the Federal Reserve began hiking interest rates in March 2022.
The rates fluctuated slightly but remained at all-time highs between early November 2023 and late January 2024: between 7.76% and 6.69% for 30-year fixed mortgage rates, and between 7.03% and 5.96% for 15-year fixed mortgage rates, according to Freddie Mac’s survey.
Median sale price
The median sale price rose marginally across all three counties:
- Indian River: $384,000, up from $380,000 in December
- Martin: $570,000, up from $560,000 in December
- St. Lucie: $390,000, up from $389,995 in December
Since March 2020, median home prices in Indian River, Martin and St. Lucie counties have increased respectively by 61%, 52% and 44% — mainly because the population growth and low interest rates during the pandemic led to high demand for homes in the region.
Port St. Lucie’s home affordability rank, calculated by the National Association of Realtors, dropped by 46 ranks to 141 in the last quarter of 2023 from 97 in 2014. This is one of the sharpest declines in affordability across the nation’s metropolitan areas, behind only Ocala and the Sherman-Denison metropolitan area in Texas.
Months’ supply of inventory
The months’ supply of inventory also rose across the three counties, but is still below normal levels of 5-6 months’ of supply:
- Indian River: 4.9, up from 4.2 in December
- Martin: 3.9, up from 3.6 in December
- St. Lucie: 4.1, up from 3.6 in December
Median time to contract
The median time to contract rose across the region, especially in Martin County, which grew by 100% month-over-month:
- Indian River: 55, up from 46 in December
- Martin: 50, up from 25 in December
- St. Lucie: 34, up from 32 in December
Ananya Tiwari is a business reporter for TCPalm. You can reach her via email at [email protected] or follow her on Facebook, Twitter, and MuckRack.