Real estate inventory high. Why?

[AMB444]

Ok, all you smart people of TOTV.

I keep hearing from various sources that the real estate inventory is high right now and many properties are available.

What's your best guess or opinion on why this might be?

Thanks again for your responses!

It's impressive how much knowledge TOTV members have, so I do appreciate you all sharing your thoughts.

[Papa_lecki]

Young families are in starter homes with a 2% mortgage. They cant afford a bigger home with a 6.8% mortgage, which means the retires from up north can’t sell their homes to buy in The Villages.
Once rates come down 100 or 150 basis points, probably between July and September, the settlement agencies will be running 24x7.

[AMB444]

Once rates come down 100 or 150 basis points, probably between July and September, the settlement agencies will be running 24x7.

Interesting, thank you!

So do you predict sales picking up by the end of the year?

[Papa_lecki]

Interesting, thank you!

So do you predict sales picking up by the end of the year?

Keep your eye on the FED meeting on 5/6 and 5/7. See what they do with rates.

[Stu from NYC]

High interest rates making it harder to afford mortgages

[AMB444]

High interest rates making it harder to afford mortgages

Thanks!

Would it make sense to get an ARM and then refinance to standard mortgage when rates seem their lowest?

[CarlR33]

Thanks!

Would it make sense to get an ARM and then refinance to standard mortgage when rates seem their lowest?All of your questions would be based on your personal situation. You can talk to a bank that may allow you to lower your fixed rate (within a time window) should they come down after taking on your mortgage. Standard rule of thumb is one percent lower you should review refinancing (like we all probably did back in the day of high rates).

[Stu from NYC]

Thanks!

Would it make sense to get an ARM and then refinance to standard mortgage when rates seem their lowest?

Hard to answer as we know very little about you. Might want to talk to financial advisor.

Historical standards says rates on the low side for now, my crystal ball is mad at me

[vintageogauge]

Also, many who were ready to pull the trigger are now confused with the drop in the stock market and will most likely wait for it to get it's strength back.

[tophcfa]

Real estate values are always driven by supply and demand. Supply is being added very rapidly, buts that’s nothing new in the Villages. Demand for homes has slowed, increasing inventories. My take on slower demand includes the following:

Inflation - This is a very real and significant problem, cutting significantly into people’s disposal income and willingness to purchase a second home (which represents a significant percentage of Villages homes).

Decrease in home values up north - This makes it much more difficult, and risky, for those looking to flip their northern home into a Villages residence.

Floridas outrageously high property and casualty insurance (both homeowners and auto), property taxes, and the bond that comes with many Villages homes - It’s not just the price of homes that buyers must be able to afford, it’s the total package.

Economic uncertainties - These always exist, but seem unusually elevated these days, with new tariff driven inflation and recession fears and a very volatile (not in a good way) stock market. Not an environment conducive to making a significant investment in a home. I suspect many retirees equity in their investment portfolios have a high correlation to their willingness to purchase property.

Investor owned properties- The demand from this segment has slowed for several reasons, which all make a speculative real estate investment more risky than in prior years.

Hurricane burnout - it’s easy to forget about this factor this time of the year, but come mid October it’s fresh in people’s minds. This also effects the homeowners insurance market, which is a previously mentioned problem.

Reduced demand from those outside the USA - Many of these folks appear to be disenchanted and generally pi$$ed off with the USA these days.

Mortgage rates no longer at rock bottom like they were for many years - I suppose this is a deterrent to the segment of buyers not paying cash for their homes.

Just some random thoughts.

[AMB444]

Historical standards says rates on the low side for now, my crystal ball is mad at me

Haha. Excellent!

[AMB444]

Thank you to all. I just found this thread and this is exactly the info I was looking for.

https://www.talkofthevillages.com/forums/villages-florida-general-discussion-73/villages-home-inventory-has-exploded-356426/

[Boomer]

Real estate values are always driven by supply and demand. Supply is being added very rapidly, buts that’s nothing new in the Villages. Demand for homes has slowed, increasing inventories. My take on slower demand includes the following:

Inflation - This is a very real and significant problem, cutting significantly into people’s disposal income and willingness to purchase a second home (which represents a significant percentage of Villages homes).

Decrease in home values up north - This makes it much more difficult, and risky, for those looking to flip their northern home into a Villages residence.

Floridas outrageously high property and casualty insurance (both homeowners and auto), property taxes, and the bond that comes with many Villages homes - It’s not just the price of homes that buyers must be able to afford, it’s the total package.

Economic uncertainties - These always exist, but seem unusually elevated these days, with new tariff driven inflation and recession fears and a very volatile (not in a good way) stock market. Not an environment conducive to making a significant investment in a home. I suspect many retirees equity in their investment portfolios have a high correlation to their willingness to purchase property.

Investor owned properties- The demand from this segment has slowed for several reasons, which all make a speculative real estate investment more risky than in prior years.

Hurricane burnout - it’s easy to forget about this factor this time of the year, but come mid October it’s fresh in people’s minds. This also effects the homeowners insurance market, which is a previously mentioned problem.

Reduced demand from those outside the USA - Many of these folks appear to be disenchanted and generally pi$$ed off with the USA these days.

Mortgage rates no longer at rock bottom like they were for many years - I suppose this is a deterrent to the segment of buyers not paying cash for their homes.

Just some random thoughts.



I would say your "random thoughts" pretty well nailed it.

Boomer

[Normal]

Spare cash may be the real problem soon enough. A Market Crash isn’t welcome by any of us. Most don’t NEED a house in the Villages. Security and safe harbor come first.

[mraines]

Ok, all you smart people of TOTV.

I keep hearing from various sources that the real estate inventory is high right now and many properties are available.

What's your best guess or opinion on why this might be?

Thanks again for your responses!

It's impressive how much knowledge TOTV members have, so I do appreciate you all sharing your thoughts.
Possibly because the developer is building too many homes and many are becoming disappointed with the Villages. Canadians may be selling their homes.

[Kelevision]

I was born in Lake County and was here before TV. IMO, There are several reasons. There are tons of rental properties here and what used to be a very lucrative income has turned into not such a lucrative income. I personally know 2 friends who just recently sold their rentals. They still live here in their other home. Lots of Canadians also own homes here and are selling. And people are leaving Florida in general due to high taxes, among other issues. I’m gonna go out on a limb and say expect more houses to get listed and less people buying in general for a while.

[Nanshe]

Yes!

[G.R.I.T.S.]

In my case regarding my friend’s home, she passed late last year and her relatives have the house on the market. I also know of several more people who have to move because of illnesses. I suspect this is a common reason as we do live in “God’s waiting room.”

[Andyb]

Nailed it.

[kimgarwel12@gmail.com]

We just looked at purchasing a CYV last week. Our current minimal mortgage is at 3%. After talking to the bank, even VA mortgage rates are at 6.5%. Add to that the substantial bonds, realtors fee of 5%, and estimated closing costs of $21k ( on a $350k house?? Seriously??) and even the banker said it was a no brainer, sit tight where you are. I guess our patio villa doesn't look so bad right now!! Too much inventory sitting for more than 6 mos. I've said more than once that it's easy to buy a house in Florida, but a bi$@# to sell one (from personal experience).

[Nana2Teddy]

Real estate values are always driven by supply and demand. Supply is being added very rapidly, buts that’s nothing new in the Villages. Demand for homes has slowed, increasing inventories. My take on slower demand includes the following:

Inflation - This is a very real and significant problem, cutting significantly into people’s disposal income and willingness to purchase a second home (which represents a significant percentage of Villages homes).

Decrease in home values up north - This makes it much more difficult, and risky, for those looking to flip their northern home into a Villages residence.

Floridas outrageously high property and casualty insurance (both homeowners and auto), property taxes, and the bond that comes with many Villages homes - It’s not just the price of homes that buyers must be able to afford, it’s the total package.

Economic uncertainties - These always exist, but seem unusually elevated these days, with new tariff driven inflation and recession fears and a very volatile (not in a good way) stock market. Not an environment conducive to making a significant investment in a home. I suspect many retirees equity in their investment portfolios have a high correlation to their willingness to purchase property.

Investor owned properties- The demand from this segment has slowed for several reasons, which all make a speculative real estate investment more risky than in prior years.

Hurricane burnout - it’s easy to forget about this factor this time of the year, but come mid October it’s fresh in people’s minds. This also effects the homeowners insurance market, which is a previously mentioned problem.

Reduced demand from those outside the USA - Many of these folks appear to be disenchanted and generally pi$$ed off with the USA these days.

Mortgage rates no longer at rock bottom like they were for many years - I suppose this is a deterrent to the segment of buyers not paying cash for their homes.

Just some random thoughts.

Your random thoughts feel very spot on!

[Marine1974]

Ok, all you smart people of TOTV.

I keep hearing from various sources that the real estate inventory is high right now and many properties are available.

What's your best guess or opinion on why this might be?

Thanks again for your responses!

It's impressive how much knowledge TOTV members have, so I do appreciate you all sharing your thoughts.
Currently the interest rates on a $400,000 home requires a $200,000 household income.
70 % of Americans purchasing a home with 20 % down payment do not qualify.

[Dgodin]

I can't believe people thinkk interest rates are high. Doesn't anyone remember when rates were actually high in the double digits?

Inflation is a factor, it's cutting into disposable income. The end of remote work is a factor. People close to retirement bought here. Insurance is a factor. For some it is unobtainable, for others it is expensive. Uncertainty is a factor.

[Bridget Staunton]

Not near as high as we used to pay years ago I remember paying 10% and I was glad to pay, just save a little more

[slg0921]

Real estate values are always driven by supply and demand. Supply is being added very rapidly, buts that’s nothing new in the Villages. Demand for homes has slowed, increasing inventories. My take on slower demand includes the following:

Inflation - This is a very real and significant problem, cutting significantly into people’s disposal income and willingness to purchase a second home (which represents a significant percentage of Villages homes).

Decrease in home values up north - This makes it much more difficult, and risky, for those looking to flip their northern home into a Villages residence.

Floridas outrageously high property and casualty insurance (both homeowners and auto), property taxes, and the bond that comes with many Villages homes - It’s not just the price of homes that buyers must be able to afford, it’s the total package.

Economic uncertainties - These always exist, but seem unusually elevated these days, with new tariff driven inflation and recession fears and a very volatile (not in a good way) stock market. Not an environment conducive to making a significant investment in a home. I suspect many retirees equity in their investment portfolios have a high correlation to their willingness to purchase property.

Investor owned properties- The demand from this segment has slowed for several reasons, which all make a speculative real estate investment more risky than in prior years.

Hurricane burnout - it’s easy to forget about this factor this time of the year, but come mid October it’s fresh in people’s minds. This also effects the homeowners insurance market, which is a previously mentioned problem.

Reduced demand from those outside the USA - Many of these folks appear to be disenchanted and generally pi$$ed off with the USA these days.

Mortgage rates no longer at rock bottom like they were for many years - I suppose this is a deterrent to the segment of buyers not paying cash for their homes.

Just some random thoughts.

Add to this that in the early 2000's, baby boomers were grabbing houses in TV and fueling growth. Now, those baby boomers are getting older and may be having health issues that force them to move back north to be with family who can take care of them.

[jimhoward]

One reason that the number of listings in the Villages is historically high is that the Villages is historically big. There are more homes than ever before so we expect more listings.

Given that many villagers die every year and many more move within the villages every year, the number listings as a percent of total homes does not seem particularly high (even though I dont know what that exact number is).

[tophcfa]

Add to this that in the early 2000's, baby boomers were grabbing houses in TV and fueling growth. Now, those baby boomers are getting older and may be having health issues that force them to move back north to be with family who can take care of them.

Good point, lack of quality health care in and around the Villages is a very real issue. Not only could it cause older retirees with health issues to relocate, but potential new residents might finally be waking up to the problem. Adequate quality health was a real issue here several years ago, and it only keeps getting worse as the rapid growth in housing is suffocating the healthcare system.

[Normal]

Home Insurance premiums are almost double a year later. It amounts to about 1,000 dollars a household. Perhaps 100 dollars extra a month here in The Villages. Not to mention auto rates skyrocketing.

[Tyson]

Its the markets. Anyone who might have been considering retiring to TV is probably thinking twice and those homes being built will sit for along time.

[thelegges]

We just looked at purchasing a CYV last week. Our current minimal mortgage is at 3%. After talking to the bank, even VA mortgage rates are at 6.5%. Add to that the substantial bonds, realtors fee of 5%, and estimated closing costs of $21k ( on a $350k house?? Seriously??) and even the banker said it was a no brainer, sit tight where you are. I guess our patio villa doesn't look so bad right now!! Too much inventory sitting for more than 6 mos. I've said more than once that it's easy to buy a house in Florida, but a bi$@# to sell one (from personal experience).

Money goes a long way in today’s market. So buy now, hold on to current home, rent low to offset costs, then when market has an upturn sell. Under contract a home can be more desirable

[Normal]

Money goes a long way in today’s market. So buy now, hold on to current home, rent low to offset costs, then when market has an upturn sell. Under contract a home can be more desirable

I would rent right now and wait for the home prices to come down further. We are at the end of the big selling season with less than lackluster data. Renting is cheaper now, and it makes you more portable when you do decide to pull the trigger.

[Dakotaboy]

Real estate values are always driven by supply and demand. Supply is being added very rapidly, buts that’s nothing new in the Villages. Demand for homes has slowed, increasing inventories. My take on slower demand includes the following:

Inflation - This is a very real and significant problem, cutting significantly into people’s disposal income and willingness to purchase a second home (which represents a significant percentage of Villages homes).

Decrease in home values up north - This makes it much more difficult, and risky, for those looking to flip their northern home into a Villages residence.

Floridas outrageously high property and casualty insurance (both homeowners and auto), property taxes, and the bond that comes with many Villages homes - It’s not just the price of homes that buyers must be able to afford, it’s the total package.

Economic uncertainties - These always exist, but seem unusually elevated these days, with new tariff driven inflation and recession fears and a very volatile (not in a good way) stock market. Not an environment conducive to making a significant investment in a home. I suspect many retirees equity in their investment portfolios have a high correlation to their willingness to purchase property.

Investor owned properties- The demand from this segment has slowed for several reasons, which all make a speculative real estate investment more risky than in prior years.

Hurricane burnout - it’s easy to forget about this factor this time of the year, but come mid October it’s fresh in people’s minds. This also effects the homeowners insurance market, which is a previously mentioned problem.

Reduced demand from those outside the USA - Many of these folks appear to be disenchanted and generally pi$$ed off with the USA these days.

Mortgage rates no longer at rock bottom like they were for many years - I suppose this is a deterrent to the segment of buyers not paying cash for their homes.

Just some random thoughts.
Excellent Article!!

[thelegges]

I would rent right now and wait for the home prices to come down further. We are at the end of the big selling season with less than lackluster data. Renting is cheaper now, and it makes you more portable when you do decide to pull the trigger.

If there was a home I really wanted in location, and design, I would make an offer now.

Then rent our current home long term unfurnished. 3 years after we sold one of our investment homes. Our average inquiries every year was 20-34.

The rental site has been removed since selling, but I still get 10-15 emails a year inquiring if home is available long term.

[Vernon Hud]

I have heard through the grapevine, that the Villages developer has their people sitting on used property, and only trying to sell new homes.

[Nana2Teddy]

Not near as high as we used to pay years ago I remember paying 10% and I was glad to pay, just save a little more
Our first home purchase in Sept 1979 in SoCal we had a 13% rate on a $50K home with 20% down. Seemed like a fortune at the time because I’d just become a full time mom, so we were down to one income.