Real estate and homebuilding industry leaders say that prices and inventory levels will adjust.
Many experts believe the Northeast Florida housing market is rebalancing, and they don't consider that to be a bad thing.
Data shows that the region is experiencing a slight dip in home sales, but area industry leaders from real estate brokers to homebuilders say the slowdown could help bring prices and inventory levels back to more manageable levels.
According to the Northeast Florida Association of Realtors November report, home sales were down 2.9 percent from a year ago, while prices continued to increase with the average home price at $258,803, or 3.4 percent more than November 2017.
“Affordability concerns are causing a slowdown in home-price growth in some markets, while price reductions are becoming more common,” the NEFAR report says.
“Builders are showing caution by breaking ground on fewer single-family home construction projects in the face of rising mortgage rates and fewer showings.”
The report also showed that median prices are up 7.8 percent year to date, while inventory still is around 3½ months, significantly below the five- or six-month level that is considered balanced.
However, industry leaders said they did not think the market, nationally or regionally, will crash like it did a decade ago.
In fact, they believe demand will remain high as the region's population continues to climb since unemployment is at a low rate and wages are increasing.
Ann King, vice president of brokerage for Berkshire Hathaway HomeServices Florida Network Realty, said Jacksonville's warm weather and available jobs will continue to draw additional people wanting to purchase a home.
“Buyers are shocked when they hear how low our property taxes are here,” she said.
Joe Blanco, the North Florida division president for ICI Homes, said he expects steady growth to continue with its homebuilding projects.
He, along with King and others, believe that rising interest rates could benefit sellers, builders and Realtors because buyers will want to lock in their mortgage rates before they rise.
Plus, they said homebuyers are getting deals compared to the much higher interest rates in the past.
Mike Taylor, the North Florida division manager for GreenPointe Communities, said rising labor and supply costs are challenges to affordability for the national, regional and local developers.
“We're trying to work with our builder partners on what their needs are, on their product choices and on how they purchase land to make it affordable for them,” he said.
Taylor said construction and land costs are increasing faster than home prices are rising, so some developers and builders likely will offer more incentives and amenities to attract buyers.
Pete Dalton, the owner and broker of Coldwell Banker Vanguard Realty, said real estate is like politics in that some media outlets report that sales are down while not analyzing the statistics or showing that the market is slowing nationally but not in all regions in the country.
For example, he said certain parts of Jacksonville are doing well while other areas are suffering a significant sales decline.
“The luxury market at the beach is really hot. Multimillion stuff is selling really well,” Dalton said.
Kevin Waugaman, the vice president of core services at Berkshire Hathaway HomeServices, also believes prices will stabilize and the market will “normalize.”
He said one major benefit will be the return of low home inventory to normal levels. That will give buyers more choices, he said.
Dalton said people are nervous because the economy is undergoing serious fluctuations, but that the Jacksonville housing market at least is not “overheated” like Dallas and San Francisco, where he said it's “out of control.”
He said it will be a few months into 2019 before the impact is known since he said the local housing market is seasonal as most sales take place in the spring and summer.
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