7801 Deercreek Club Rd., Jacksonville, FL 32256
For more information contact:
Marcia HodgsonDirector of Communicationsmhodgson@nefar.com(904) 394-9144
JACKSONVILLE, Fla. October 12, 2021 – Homes in Northeast Florida are becoming less and less affordable.
Dwindling affordability, as evidenced in a record-high sales prices, has impacted homebuyers, particularly first-timers, who are increasingly finding themselves priced out of the market. As the market cools slightly heading toward the holidays, many buyers who were hoping to land their first home are choosing to wait for sales prices to become more manageable before resuming their home search.
In September, Northeast Florida’s housing affordability index fell five points from its level of 118 in August to 113, its lowest mark in 15 years. The index measures the percentage of what is necessary to qualify for a median-priced home under prevailing interest rates. Higher numbers mean greater affordability, and September’s index of 113 means the median household income was 113% of what is necessary to qualify for a median-priced home under prevailing interest rates. This marks a 19.3% drop in affordability from September 2020, when the index measured a lofty 140.
“The median and average sales prices are bumping hard against median and average incomes for the area, which is reflected in the low affordability index,” said Missi Howell, president of the Northeast Florida Association of REALTORS®. “This is not the beginning of a bust, nor is one expected, but perhaps a pause where we may be able to expect a leveling off of demand until consumers see a better picture of their incomes versus overall inflation and where their budgets will allow them to go.”
Rising sales prices in the region coincided with a 5.1% decrease in pending sales and a 12.5% decrease in closed sales from a year ago. In September, the average sales price climbed to $370,751, growing 16.9% from last September and showing more than a $10,000 increase from a month ago. Meanwhile, the median sales price of homes in the Northeast Florida weighed in at $307,230, a 19.7% jump compared to last year. This was also a significant increase from a month ago, when the median price of a home in the region was $300,000.
As in July and August, September 2021 showed only a 1.5-month supply of homes available for sale on the First Coast. September’s inventory rose ever so slightly to 4,850 houses – a subtle 200-home increase since August 2021. However, this marks a 29.1% year-over-year decline in inventory from a year ago.
So, the strong sellers’ market continues unabated with homes routinely spending a mere 30 days on the market, the least amount of sales time during the past 18 years.
“While we are still seeing inventory shortages, especially in the first-time homebuyer price ranges, there has been a cool down in some markets from the red-hot frenzy we saw in the second quarter of the year,” said Howell. “However, the best defense to inflating housing expense is to purchase a home – even where financing is involved, as mortgage, taxes, and insurance are more stable and predictable than what a landlord may choose to charge a tenant. And the best way to successfully navigate in this market is to work with a REALTOR®.”
Monthly Indicators and Housing Supply Overview - Click Here
Monthly Lender-Mediated Reports - Click Here
The Northeast Florida Association of Realtors (NEFAR,) serves as the voice of real estate in Northeast Florida. As the region’s largest professional association, it represents more than 10,000 members who work in all facets of the real estate industry including residential and commercial sales and property management. It serves the public through support of community affairs programs and seeks to protect private property rights. The Northeast Florida Multiple Listing Service is a wholly owned subsidiary of NEFAR. NEFAR is headquartered in Jacksonville, with satellite Service Centers in Orange Park, Jacksonville Beach, Palatka, and World Golf Village.
Return to Media Center