TAMPA, Fla. — Potentially good news for home buyers in the Tampa Bay area — we could be in what some are calling a housing correction that’s pushing home prices lower.
As we move from a housing boom into a housing correction, inventory is rising fast.
Alexis Sande is from Minnesota. She and her fiance moved into their new home in Largo just days ago.
“This house had been on the market for about five days. We were the third offer, so we had to make the decision fast,” Sande said.
In the face of less buyer competition because of rising mortgage rates, Sande said they did not need to go above the asking price.
“With the interest rates going up, we didn’t have to get into a bidding war with anybody and offer more money for the home or anything like that,” Sande said.
Economists with Moody’s Analytics predict national home prices to decline 5% to 10%. In “significantly overvalued” housing markets, experts expect home prices to drop between 15% to 20%.
If a housing market is “overvalued” by more than 25%, Moody’s Analytics deems it “significantly overvalued.” The Tampa, St. Petersburg, Lakeland and Sarasota housing markets are all considered “significantly overvalued.”
“Florida prices have grown more because of the migration, people moving to Florida as opposed to other parts of the country where people just aren’t moving to,” SVN Saunders Ralston Dantzler Realty managing partner Gary Ralston said.
As the housing market continues to cool off, Ralston tells ABC Action New in Lakeland, where the population is surging, the decline in home prices will be moderate.
“According to the latest census algorithm Polk County is growing by 62 people a day,” Ralston said.
Ralston said this population boom translates into demand for housing. He added that at current levels, the demand and supply are equal in Polk County.
"We’re generating about as many residential permits as we would have population growth," he continued. "That's a combination of single-family homes plus apartments. Places for people to live, so we’re pretty much in balance."
He said increased interest rates mean that about 44% of the households in Florida can qualify for the median price home. In Polk County, that number is 47%.
“Our feeling is that we will see modest price adjustments here on a relative basis compared to what happens in other markets in Florida and what happens in the nation. It's because we’re still more affordable,” Ralston said.
Realtors explained that it is consistent to see a slight decrease in pricing heading into the end of the year. This trend makes it a great time to buy and negotiate homes.
