Signs are emerging that some home shoppers, frustrated by losing out on homes against multiple offers, are pausing their search in hopes that the housing market might slow down by the end of the year.
The insane market is turning off buyers who have spent months searching for a home only to be beat out by other offers, or who are struggling to find a home left on the market that fits their desires, real estate agents told the South Florida Sun Sentinel.
The change has not dampened home sales yet; June was still a record month. But indications are arising that some shoppers have had enough.
A survey from the National Home Builder Association found that 20% of buyers planned to wait in their search for at least a year if they couldn’t find a home within three months.
Sixty-four percent of people surveyed in June by Fannie Mae, the federal mortgage service, said it’s a bad time to buy a home, compared with 77% of people who said it was a good time to sell one.
“I see people getting interested in the market and seeing a couple of homes and immediately bailing out,” Jeff Grant with ReMAX Real Estate in Palm Beach Gardens said. “Sometimes they are looking for something particular and there is hardly anything on the market.”
His client Veronica McLeod from Palm Beach Gardens stopped her home search for the past four months after growing increasingly frustrated with how quickly homes disappeared from the market before she even had a chance to look at them. Each time she came across a home she liked online for the past year, other buyers already put offers on it.
“It was nuts, I just couldn’t handle that temperature,” she said. She’s looking for a four-bedroom, three-bathroom home in Palm Beach Gardens to stay close to family and hopes to eventually find something before the year is over.
Realtor Liz Dawes in Fort Lauderdale noticed in July that more of her buyers were getting tired of the housing market. She’s showing half the amount of open houses recently, and about 30% of her buyers have decided to put a pause on their home search in recent weeks.
“It’s tiring for buyers after putting in several offers and they aren’t getting what they thought they should get,” Dawes said.
Some buyers have grown so frustrated they’ve left South Florida completely, looking a little father up north in Florida, like the Cocoa Beach area, or getting a completely different house than originally planned.
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Some are frustrated when sellers reject their offers simply to wait for a better one.
“One client had a very strong offer, close to asking and 50% cash. The seller said no because it was offered on Day 1,” said Ellen Taracido of Collection Realty in Fort Lauderdale. The client ended up looking for homes in other areas of Florida.
Graham Davis, 32, and his wife, Sophie, 29, of Delray Beach, stopped searching for a home a month ago after putting in three offers, often $50,000 above asking price, on a few homes in eastern Boca Raton or Delray. Trying to upgrade from their current home in Delray Beach, they hope to resume the search toward the end of the year.
“We were kind of expecting this. We’ve been wanting to move for the past year, but with COVID, we were wary about it,” Davis said.
Real estate agents don’t believe these are signs that the market is cooling, as homes are still selling and demand is strong. Median prices hit new records in all three counties in South Florida: $500,000 in Palm Beach County, $498,203 in Broward and $500,000 in Miami-Dade.
For every buyer who leaves the market, there are twice as many who are entering the market eager to buy a home.
“We’re trying to drum up inventory for our team’s buyers by sending direct mail postcards into neighborhoods where they are looking and trying to find anything off market that might be a good fit for them,” said Brian Pearl of The Pearl Antonacci Group in Boca Raton.
Real estate agents predict a continuing cycle until more homes come back onto the market, though when that happens remains to be seen. Grant noticed he’s recently been getting more calls from people wanting to sell their homes, a sign that he hopes means more listings on the way.
But agents also warn that new COVID restrictions in other states could drive more people to restriction-free Florida, further fueling the sizzling housing market.
“The already hot market could become impossible for buyers,” said Lisa Treu of Treu Group Real Estate in Delray Beach.
