Some regret having remained on the fringes of the real estate market

FORT LAUDERDALE, Florida – As South Florida home prices have skyrocketed during the pandemic, some people have decided to suspend their home shopping in the hopes that prices might drop, a move they are starting to regret.

Today, after a year and a half of record price growth and dwindling inventory, non-buyers are stuck in a precarious situation: they want to buy, but are faced with higher prices than they used to be. when they started looking and found themselves at risk of being shut out of the South Florida real estate market.

“They feel like they’ve made a mistake at some point and they feel like they can’t catch up because the market is so far ahead of them that they can’t come back,” said Alicia Cervera of Cervera Real Estate in Miami.

Allie Sinbine and her husband Steve were among those who decided to try to wait for the real estate market after they started looking for homes in June 2020. They paused their search a month after shopping, believing that ‘It was likely that house prices would start to fall towards the end of the year.

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“We assumed that with the New Year and the end of the elections, we would start to see things stabilize and they would fall back to where they were,” she said.

Instead, home prices continued to rise, pushing the couple further out of the housing market. They’re looking for a three-bedroom, two-bathroom home in the $ 250,000- $ 300,000 range, but as prices have continued to climb, they’ve broadened their search beyond Palm Beach County further north. to Port St. Lucie. They are exploring new construction homes and consider that they might need to increase their budget a bit.

“We never expected it to be almost 2022, and there is still nothing for us to move in that is affordable,” Sinbine said.

Home prices jumped, no slowdown in sight

Home prices have skyrocketed in South Florida during the pandemic, as intense demand from out-of-state buyers paired with historically low inventories to create an intense sellers market where buyers were often faced with paying more than asking price and losing in bidding wars.

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In a market where it’s common for buyers to lose out and face multiple bidding wars, this can discourage home buyers and be reluctant to buy, said Brian Pearl, senior agent for Pearl Antonacci Group in Boca Raton.

“I have had buyers regretting having waited more recently, as the market has not slowed down as they now think,” he added.

He is not the only real estate agent with clients facing this problem. Jeff Creegan of Re / MAX Services in Boca Raton said about 30-40% of his clients over the past year have ended up trying to wait for the housing market to end. Many were hesitant to buy in the spring or even last summer as they saw prices skyrocket, only to see them rise even more at the end of the year. The general feeling, he said, is that they made a mistake in trying to wait for the market to exit.

Now, as they start looking again, buyers say they are greeted by more expensive $ 100,000 homes.

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As a result, Creegan said, “They are looking for different markets, like Southwest Florida or more affordable markets.”

He was looking at a three-bedroom, two-bathroom home himself in January, listed at around $ 410,000. He decided to wait, but when he returned home in April, his price was $ 480,000. He was able to get it for $ 450,000.

In February 2021, the median selling price of a home in Miami Dade County was $ 450,000, a 21% increase from the previous year, according to figures from Broward, Palm Beach and St. Lucie Realtors. For Broward County, the median selling price of a home was $ 433,000, a 12% increase from the previous year. For Palm Beach County, the median selling price of a home was $ 450,000, a 24% increase from the previous year.

Fast forward to October 2021, when median selling prices rose 19% from a year ago in Palm Beach County to $ 500,000 in October. For Broward County, the median selling price of a home was $ 489,000 in October, an annual increase of 17.8%. In Miami Dade County, the numbers jumped 12.6% to $ 490,000 in October.

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“Buyers have come up to me asking ‘with these high prices, do you think we should sit down and wait?’ I always tell them that no one can predict what’s coming or if the prices will go down, ”said Christina Tokar, real estate agent at Re / MAX Advantage Realty in Davie.

Jeannie Schwartz is another client who has decided to put her research on hold in the hopes that the market will stabilize.

“I’m kicking myself,” she said. She began looking in January for a home within her budget of $ 300,000 to $ 350,000, but found the properties fell short of the quality she had hoped for. Almost a year later, prices in the same neighborhoods she once sought out have risen by almost $ 100,000.

“I got a price for the purchase,” she added. “I really should have bought something because now the properties are worth so much more. I feel like I’m going to have to leave Florida.

She added that she was also worried about buying a house when the market was at its peak, in case there was a crash later.

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The 2007 real estate crash is probably still fresh on the minds of many potential buyers, noted Eli Beracha, director of the Hollo School of Real Estate at Florida International University, and this is potentially one of the reasons they try to wait until the end of the housing market.

Beracha also noted, however, that the forces fueling this housing market are different. “We had an oversupply last time (in 2007); we don’t have that this time. If you don’t have the excess supply, it is difficult for the market to correct significantly. In other words, he does not see a dramatic crisis in our future.

Out-of-state client Dr. Ketang Modi, his wife and two daughters are moving from New Jersey to Broward County and looking for a house of around 4,500 square feet with a minimum of four bedrooms.

In their previous research, they looked at homes in a Davie community that were priced at around $ 1.2 million, and now, four months later, the prices are as high as $ 1.6 million, which prompted him and his family to consider renting until the market ends.

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“Everything is overpriced,” he laments. “I don’t know when there will be a correction or when the prices will stabilize.”

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