Happy Father's Day to all of our Fathers! Wishing all fathers and your children a wonderful day!

We are now entering the summer real estate season. This is the time when children are no longer in school, giving more time for families to discover a new home. Most families would rather buy than rent and rentals are at an all time high.

The market in South Florida is unlikely to change anytime soon. Real estate inventory is still low and home prices are up on a national level. Normally, the spring months are when we see a major increase in property listings. This year the spring market held steady without the anticipated arrival of more listed homes. The summer months will most likely not see any significant fluctuations in the number of listed houses.  The optimum supply range for housing is 6 to 9 months of supply.  

Currently, the Broward County housing market for April 2022 is at 1.2 months of inventory supply, which brings significant appreciation to our home values. The pandemic came and prices for real estate rose in South Florida due to supply and demand.  People started leaving high tax states such as California, Illinois and New York to live in Florida and they are still coming to the sunshine state. In Broward County, the median sale price for a single family home for April 2022 is $560,000.00.

Where is inflation going? The Federal Reserve raised the target for the federal funds rate by half a point on May 4, 2022, which became effective on May 5, 2022 . This was the second consecutive interest rate hike in 2022. The first rate hike was during March 15-16, 2022 and became effective on March 17, 2022. The Fed is expected to raise interest rates again this year to drop inflation to the 2% target. Inflation in 2021 was 6.5%. Currently, inflation is at 9%, the highest level in 40 years.

Having the Federal Reserve raise the interest rate affects mortgage rates for the housing industry.  As time goes on mortgage rates will more than likely continue to climb. The historical low 3% mortgage rate was a great help for homeowners to be thankful for. Our average mortgage rates are currently around 5%. Rates are up compared to last year but the mortgage rates are still historically low.

Safety First! The Florida Legislature unanimously approved a condominium safety bill, S.B. 4D, this past week. Rick DeSantis, Florida's Governor signed the bill on May 26, 2022. The bill was passed due to a high rise condominium building in Surfside Florida collapsing, the Champlain Towers, where 98 people were killed.

Florida will require statewide recertification of condominiums over three stories tall. This
recertification will be required after 30 years, or 25 years if the building is within 3 miles (5 kilometers) of the coast, and every 10 years thereafter. The Champlain Towers South was 40 years old and was going through the 40-year-recertification process required by Miami-Dade County when it collapsed last June. For people purchasing a condominium with a mortgage, the qualifications are more difficult, especially on older buildings.

The new requirements call for banks and other lenders to collect detailed information about a building’s structural integrity, special assessments for condo association members and “reserve funding” maintained by the associations for major special projects. Reserves in a building help those financing. The reserves are seen in the building's budget.  When the reserves are at 10%, qualified buyers can place a 10% down payment on the building. When reserves are less,  buyers will need 25% for the down payment on a condominium purchase.
If you are ready to buy or sell your South Florida property, please call Susan Penn at 954-557-5993.