Would-be homebuyers may soon get a break, with houses sitting on the market for longer. But prices are not dipping just yet. With home shopping season winding down, that could be a sign that competition is waning, according to a new Zillow report. That is good news for those house hunting in Tampa who have struggled for months to find new abodes.
House hunting in the Tampa area
For Keelie Thomas, the situation got so bad she decided to look outside of Florida for an affordable home. Same for Aye Khalid, whose in-laws recently bought houses here. They don’t want to go, but the Tampa area housing prices are above their budget.
“It could be that some homeowners have been waiting until prices set new highs in their market before opting to cash in their chips,” said Jeff Tucker, senior Zillow economist.
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“The total pool of existing homes for sale is lower than any June since at least 2018. It’s down 10% from last year and a tremendous 45% below June 2019.”
Johanna Carlton finally gave up after spending a year looking for a place in Ybor City. She renewed her lease at $2,400 a month, “which is still much cheaper than any home in the area, especially with interest rates the way they are.”
“A lack of new listings has dogged the housing market for nearly a year, and higher mortgage rates remain the chief suspect,” according to the Zillow report. “Rates at 6.8% this week (the highest since November, up from 5.1% a year ago and 3% two years ago) make it especially costly for homeowners — most of whom have a mortgage well below today’s rates — to borrow for their next home purchase.”
The slight relief that may be coming is due to demand and competition both cooling.
“Listings also lasted longer in June, 11 days before the typical listing went pending, compared to 10 in May,” the report states. “But that’s still a much faster market than in 2019, when listings went pending in 21 days.”
That is news to some ears, including a Tampa woman who goes by the name Dani Lynn on social media. “My husband and I have been in the market for the last two years and have put in over 20 offers,” she said. “I’d have to count, but it’s been quite a few.”
Home values have steadily increased around the country since January, but are still below the peak prices seen last summer in many markets.
Back to pre-pandemic prices?
Zillow’s latest monthly rent report shows rent growth is back to pre-pandemic norms for this time of year, about 0.6% per month. Large California cities remain the most expensive places to rent. Many want out of the rent racket and into their own house.
“Sales measured by newly pending listings dipped almost 5% from May to June, following seasonal trends seen in 2022 and before the pandemic, when accepted offers crested in May,” Zillow reports.
“The typical U.S. home value climbed 1.4% from May to June, continuing a four-month hot streak,” Zillow reports. “The new peak of $350,213 is almost 1% higher than last June and barely edges out the previous Zillow Home Value Index record set in July 2022.”
The market right now revolves around affordability. Lower-priced metro areas such as Chicago, New Orleans and Buffalo showed the largest monthly gains at 2.1% growth. Those cities all have home values lower than the national average.
“As in May, home values rose from the previous month in all 50 of the largest metro areas,” Zillow reports. “The slowest monthly growth was in Austin (0.4%), followed by Jacksonville, Memphis, San Antonio and Birmingham, which all saw 0.8% increases.”
While new homes going on the market ticked up recently, the annual deficit still deepened, with 28% fewer listings in June than a year ago.
“June is usually one of the best months for fresh inventory, but this year only 376,500 new listings arrived on the market,” the report states. “That’s closer to levels seen in the slower months of February and October than to average new listings in June (505,100), according to Zillow data reaching back to 2018.”