A PERFECT STORM OF LOW INVENTORY AND HIGH DEMAND

New-home lotteries, weekly price increases, communities selling out before the model is completed — no, we are not talking 2005; we are talking 2013. 

There’s no doubt about it — today’s real estate market is hot. And it’s only going to get hotter. A recent Trulia survey revealed that 75 percent of Americans believe it’s better to buy a new home now than it was a year ago. 

This disparity means homeowners are hanging onto their homes even though buyers are clamoring to buy. The result: inventories of homes for sale continue to shrink.  

In a nutshell demand is high and supply is low. 

Demand alone is having an impact on the prices of homes. But an event that happened nearly six months ago is about to have an even greater impact. 

On Oct. 29 of last year, Hurricane Sandy, packing 90 mph winds, came ashore near Atlantic City and caused extensive damage throughout the Northeast. So what does that have to do with home prices in Florida? 

Plenty. 

After Sandy, the same region was buried in snow, preventing homeowners from making repairs. Now it’s spring, and with insurance checks in hand, those homeowners are clamoring for  building supplies and, most importantly, labor. 

When you start adding all the factors together — the increasing demand for homes, the declining inventory of homes for sale, the impending lack of availability and the rising costs of materials and labor — it all adds up to our own perfect storm.

Needless to say, if the purchase of a new home is in your near future, my suggestion is don’t wait or you will have fewer choices — and you’ll pay more.

THERESA SWANSON

Publisher

theresas@thefloridahomebuyer.com