Reluctant home sellers, take note. There may be big profits for those brave enough to test the market.
Sellers in Palm Beach, Broward and Miami-Dade counties realized an average price gain of 45 percent, or $77,900, in the second quarter, according to the ATTOM Data Solutions research firm.
It’s the highest percentage in 10 years, the highest return of any metropolitan area in Florida and well above the national average of 26 percent.
ATTOM, of Irvine, Calif., compared sale prices of the 29,665 single-family homes and condominiums in South Florida from April through June to what those sellers paid when they bought the homes, whenever that was. The profits don’t factor in the costs of any renovations the owners made.
A year ago, sellers gained an average profit of 34 percent, or $57,900.
The report also showed that sellers in the tri-county region stayed in their homes an average of 7.6 years — the longest period on records that go back to 2000.
Owners are staying put longer in part because they can’t find other suitable homes to buy, said Daren Blomquist, a vice president of ATTOM. The shortage of listings is pushing up prices, which is leading to higher profits for sellers.
“These are important pieces of the puzzle and explain why the market is behaving as it is,” Blomquist said.
San Jose, Calif., had the biggest profit for sellers at 75 percent, followed by San Francisco at 65 percent and Seattle at 63.
South Florida sellers realizing the biggest returns likely have owned modest homes for two or more decades, Blomquist said. Those who scooped up bargains after the market collapsed also are doing well.
But sellers who bought near the peak of the housing boom from 2004 to 2007 are seeing only small returns, if any at all, because many of those properties are still worth less than what the owners paid, according to Blomquist.
Cathy Prenner, a real estate agent for Campbell & Rosemurgy in Broward County, cautioned sellers in South Florida to keep their expectations in check. Higher-priced homes in particular are a tough sell these days, she said.
“There are a lot of people still not getting their money back,” she said.
Even so, the market favors sellers because listings have been scarce in recent years, especially in lower price ranges. Home supplies declined in all three counties in June compared to a year earlier, according to figures this week from local Realtor boards.
Single-family inventory fell 2 percent in Broward and Palm Beach counties and 4 percent in Miami-Dade.
During the early stages of the housing recovery, in 2013 and 2014, the competition was so fierce that some buyers were writing letters to sellers, hoping to make favorable impressions so the sellers would select their offers.
The letter-writing campaigns have become less common in recent years, but some agents are again suggesting potential buyers put their thoughts down on paper as a way to deal with the shortage of listings.
“I’m recommending that buyers definitely do that,” said Judy Trudel, an agent in Broward and Palm Beach counties. “In today’s market, a seller can expect multiple offers. The more the buyer can do to stand out, the better.”
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