The year 2012 could be the year that the housing market within South Florida real estate finds its footing and reaches stabilization. Currently, economic and real estate data are pointing that the trend for higher sales on Miami condos and Miami homes on the existing market are seeing upswings in sales that will continue to stabilize as the market grows stronger.This trend is causing some buyers and sellers to be at odds. Buyers feel that the market is primed for buying while many sellers are balking and trying to wait out the economic slump, hoping to snag a better offer for their home.
Currently, prices reflected on many homes within the real estate market are not as high as they would be in a more stable economic market. This creates differing sides of the fence for home buyers and home sellers. Sellers feel their homes should be worth more than the current market value and are balking at selling the homes at lower rates for a variety of reasons, one of which is the possibility of taking a loss on the sale if the home is sold too far below actual value. Actual value and current market values may be different during the economic structure, but the gap will close with the resurgence of a stronger economy.
It will be at least five quarters before the gap between buyers and sellers begins to close, according to the MBA report. In the years between 1992 and 2005, seller positions remained high, about 40 to 60 percent. Since 2005, though, Miami real estate sellers have decreased to 7.6 percent. Despite unemployment rates and an unstable economy, buyers have remained in high spirits. 80 percent of American households believe that now is the prime time to purchase new real estate, a drastic contrast to seller enthusiasm.One reason buyers find the market so favorable is the fact that many homes are currently valued at lower pricing options due to the recent recession in the economy.
In the last few years as home values plummeted, many Miami real estate sellers refused to take lower offers on their homes in an effort to wait out the slump. Many cite being underwater, or owing more on their homes than the current market value is worth. For this reason, waiting for the market to stabilize or to refuse lower offers on their homes may be a tactic to breaking even or turning a profit once South Florida real estate stabilizes completely. Signs that a more stable economy is on the way are already apparent in statistical data.
According to Gary Englehardt, a Syracuse economics professor, many sellers realize there is a benefit to holding onto property and waiting for the numbers to increase rather than to sell now when prices are lower. He believes that this strategy could hold prices high enough to drive a substantial wedge between buyers and sellers. Add to that the sluggish job market, and we could see some more distance between buyers and sellers in South Florida real estate market for a bit longer.
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