today we're going to talk about the Florida real estate market we're going to look at data points
to help us understand whether or not the market has crashed thus far and what may be ahead of us
this video is going to be very much a stream of Consciousness I haven't really prepped much for
this video at all other than having pulled up some charts I just want to talk to you about the real
estate market very freely Michael has always been to provide you with as much value when it
comes to real estate and just knowing how to work the market so you can make the best decision for
you now if you're new to my channel I'm Katrina Fitzroy I'm a real estate agent in the Sarasota
County and Manatee County region so let's get right into this video first off I thought it was
important to do this video because it's actually been quite a bit of time since I talked about the
real estate market and the different data points also I hear quite a lot of people that I'm talking
to on the phone saying well we're just going to wait a little bit while longer while the prices
continue to crash in Florida and that made me feel like you know know what I need to educate
the public as to what's been happening in Florida I understand that there is a lot of different
YouTubers out there and you have different options in terms of where you can get your content because
there's certainly lots of crash videos out there crash videos on YouTube especially can Garner a
lot of money these crash videos a lot of them have been going on for over two years and so let's look
at the data and see what's truly been happening and hopefully towards the end of this video you're
going to have a much better idea of a what has been happening in the Florida real estate market
and then B provides you with more information so you can make the right decision for you
there's essentially A Tale of Two stories here if you're on the west side in California some of the
prices have dramatically come down now if you're in Florida prices have held up or in some cases
have even gone up now I always refer to the median price and not the average price and that's because
it's a much better indication of what the market truly is doing and so what I wanted to share with
you is a definition of the median price and the reason why I'm bringing this up is because I
still see quite a lot of people talking about the average price and the average price certainly has
its place when it comes to analysis but not when we're looking at a General market Trend
analysis okay so I'm going to read this to you the median sales price is the preferred metric
but understanding the marketplace since it's less volatile it makes month over month comparisons
more stable and isn't as influenced by sales that are above the normal price so in statistics speak
that one high price home sale will be an outlier because its price is outside of the typical
sales price in that area including outliers in statistics is dangerous because it can potentially
misrepresent the overall Market why am I sharing this for you because I think it's important that
you understand why I'm always referring to the median sales price also if you're doing your own
analysis I encourage you to do the same so having said that let's get right into some of the charts
that I have pulled up here okay we're going to tap into some stats which is the data portal for
Florida Realtors okay so you have to be a Florida realtor to be able to access this portal I'm going
to look at the median sales price and I actually have time frame January 2018 selected up until
April 2023 April being the last month for which we have data for and we're going to look at the
median sales surprise what I first wanted to show you is comparing this line here right visually to
what it would look like if we were to look at the average sales price there it is median average
you can see that the average sales price from a trend perspective right just visually is extremely
choppy so much better indication of how the market is faring if we're looking at the median sales
price and that's what we're going to do today so many of you that I talked to in the phone say that
you want to wait a little while longer while the prices continue to drop in Florida prices usually
are going to be higher in the peak season which for us is q1 and Q2 so when we look at Peak and
trough in terms of prices there's usually a two to six percent price difference right the price
is when compared year over year for Florida have not been below same time last year that is super
important so for example we're looking at April 2023 the median sales price is now 410 000 for
a single family home in comparison to last year it was actually 410. so right now we're matching
last year same time in April March so the months prior we were at 405 that was actually above same
time last year where it was at 396 just slightly above you can actually see the percentage changes
here we might actually come in below the same time last year for the very first time it may on June
and why do I say that because the interest rates went up right around February into March then it
started going back down again and the debt ceiling crisis right that put a lot of people on hold and
I think we're going to see the ripple effect of people waiting on the sight lines yet again in a
few months from now meaning we're going to see some effect in May and in June but point being
is that the prices have not crashed in Florida so anybody's saying that Florida as a whole prices
are crashing now medium time to contract back in May of 2022 it was historically low at eight days
I mean these homes were literally selling like pancakes now that's all changed right the high was
in February when it was actually 43 days median time to contract so it wasn't uncommon for a home
to sit on the market and it still isn't actually for over a month doesn't mean that the home has
any problems now that's dropped down to about 31 days and that's very cyclical just like prices are
but what I also want to point out is and that's one of the reasons why I chose 2018 and 2019
because to me these periods here our period where the real estate market was much more normalized
that was pre-covered days and so what we're seeing is the normalization of the marketplace a
lot of us will say that there's a Slowdown when in reality it's not really a Slowdown it's just what
it used to be before covert days so let's look at some more data points here look at Cash sales as a
percentage of closed sales I think that's a really important number for you to wrap your head around
because it just goes to show you how many cash transactions still happen today so as of April
of 2023 30 of the transactions are cash don't get me wrong Finance mortgage opportunities are strong
offers especially in today's world that wasn't necessarily the case last year where cash was
King and we still have a lot of people coming here lots of money and they're purchasing in
cash and sometimes they're purchasing this second and third home in Florida in cash
I hear a lot of people saying that during a recession the real estate market has to be
crashing because people are going to be losing their jobs people are going to have to foreclose
on their homes and the stock market is going to tank so people are going to lose a lot of
money and what I wanted to do is show you this chart here it indicates the median sales price of
houses sold for the United States this is actually for new residential homes but it's going to give
you a good idea of how prices fluctuate during recessions so what you'll see here is yearly
prices from 1963 all the way up to 2022 and in Gray I use recessions and so notice the line here
these are the prices going into the recessions 1970 prices actually have gone up 1974 prices
have gone up so they either go up or they're holding steady for the exception of 2008 but that
is different right we're not in the same situation because people can actually afford the homes that
they've purchased so now an actual question to ask is why do the prices hold pretty well during
recession I think there's essentially two reasons for probably more about two reasons that come to
mind here for me and that is first off those people who have money invested in the stock
market may want to pull that out because the stock market typically gets hit pretty hard during a
recession and many of them may want to put it into the real estate market because it's considered a
much safer investment also during recessions the mortgage interest rates typically come back down
again and so it does open up opportunities for many people just to kind of finish this part
out here talking about the recession this is what Sean Snape actually said compared
to a Florida went through in the two previous sessions the next session will be more kin to
a tropical depression and I can tell you I would take a tropical depression over hurricane any day
so I hear a lot of you guys saying the prices have gone up so much over the last two or three years
It's gotta be a bubble there's just no way it can continue to go up right and so what I've decided
to do is to look at historical data up until 1963 and this is actually for new residential sales
and so I went back and analyzed the data this is actually from the Federal Reserve economic data
to see what the percentage changes were year over year and so basically anything you see marked in
red percentage changes are in the negative and so from 1963 we were in the negative five times
anything else were positive now I've heard some people say well the last three years we've had
major price increases according to this data here it was approximately 38 from 2020 to 2022. so then
I started looking at Major price increases going back in history and I came to 1976 to 1978 where
prices grew by 37 and then see what happened after that it just continued to grow but it wasn't until
13 years later when prices dropped and then in this case actually just slightly by minus two
percent and so can prices continue to increase into 2024 and 2025 I think absolutely if demand
outpaces Supply prices are dictated by supply and demand that's all there is to it essentially as
long as there's demand over Supply prices will continue to increase if it's below Supply that's
when you're going to see prices come down mortgage brokers and lending institutions have a good
system in place to ensure that those people who are they giving mortgages to can actually afford
paying paying it off right and so looking at the stressed sales right now in the marketplace it's
at a historical low the affordability of homes here is far less than what it was three years
ago especially with the way ages not keeping up versus the price increases that we've seen over
the last few years Florida has very much become a story of The Haves and the have-nots unfortunately
and those people who have who have the money to purchase who have the income to afford a mortgage
many of them don't even reside in Florida many of them are coming from places such as New York
New Jersey Chicago California and that demand has increased especially since covert days because of
remote work possibilities so the question you have to ask yourself is will there be continued demand
going to Florida is remote work here to stay and will the mortgage interest rates go back
down again now do me a favor if you found value in this video like this video just help out the
videos performance also the Channel's performance if you have any questions in terms of the real
estate market call me email me anytime and if you're looking to purchase or sell in the Sarasota
County Manatee County area I would love to be your realtor of choice call me email me anytime and
thank you so much for tuning in today I always always appreciate when you guys do take care