When the housing market struggled, there was a big gap between asking price and selling price. In other words, with so few buyers available, people simply couldn’t get what they asked for out of a property. This was especially evident in the South Florida area, where numerous properties were sold to those relocating from out of state.
From 2008 until 2011, there was a noticeable gap between prices, forcing sellers to get much less out of their properties than they needed. It created a cycle that made the real estate market suffer even more. However, the Miami real estate market is in an upswing, and things are changing for sellers. For people who live, develop property, or work in real estate, this is definitely a change for the better.
A Closing Gap
In 2011, the actual selling price of Miami homes, on average in the United States, was around 97.1 percent, which was up from previous years as well. In the most recent survey, the national average is 98.3 percent, which is a significant change.
In today’s real estate world in South Florida and throughout the United States, more sellers are getting much closer to their asking price for the actual selling price of their properties. This will continue to push the real estate market toward the upswing.
Why Is the Gap Closing?
Many people wonder why there is such an upswing and why buyers are willing to pay more money. Most professionals and real estate experts all agree that there are a couple of reasons why things are changing.
• Loans are becoming more readily available. During the downturn of the real estate market, it was extremely difficult to get a home loan, but now it has changed. That means more people can get the financing they need to buy property.
• Inventory isn’t as available as before. Now, when the market is going upward, such a short supply of property inventory is leading to more buyers willing to pay more money for available real estate. This will force the gap to close even more.
Essentially, everything goes back to the economic law of supply and demand. Fewer properties are available and there is greater demand for them. People are willing to spend more in an effort to get the real estate they want, pushing the selling price up much closer to the asking price.
For South Florida, this means good things. Now, more real estate properties will sell and more developers will be willing to move forward with their projects. New projects becoming available in the area shouldn’t push the gap wider either. Analysts believe the real estate boom will continue, and this means there will be plenty of buyers waiting to purchase properties in the area. For the real estate investor or for someone wishing to sell their private home, this is all good news.