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Florida, Texas Housing Markets Start to Cool

While limited inventory is pushing home prices up in most of the U.S., the housing market is cooling in some cities in Florida and Texas (The Wall Street Journal, subscription).

What’s going on: “Only five of the 50 biggest markets posted year-over-year price declines in March, according to data provider Intercontinental Exchange, and four of them were in Texas or Florida: Austin, Texas; North Port, Fla.; Cape Coral, Fla.; and San Antonio.”

  • Meanwhile, sale prices for preowned single-family homes increased in 93% of U.S. metro areas in Q1 2024.
  • In 10 Texas and Florda metro areas, the number of for-sale homes last month was above typical pre-pandemic levels for this time of year.
  • Nationally, building permits for new single-family homes declined in April, but overall “new construction remains supported by an acute shortage of houses for sale” (Reuters, subscription).

Why it’s important : “[W]ith the second- and third-largest populations in the U.S., respectively, [Texas and Florida] represent a significant amount of the national housing stock. They also signal that when supply ticks higher, momentum can shift to home buyers, even as mortgage rates above 7% are limiting the pool of buyers [who] can afford to purchase.”

More buyers coming: Recent data suggest more people are considering selling their houses as the spring selling season approaches its peak.

  • However, nationwide in April, active listings were 36% typical pre-pandemic levels.

The last word: “Buyers do have a little bit more leverage” now in parts of Texas and Florida, Lisa Sturtevant, chief economist for real estate listings database Bright MLS, told the Journal. But “we’re still pretty far from being a balanced market.”

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