Don’t look now, but the single-family home market in South Florida appears to be improving for buyers. More residences are for sale. Can you negotiate a better deal? Yes, but don’t count on the seller to come down on price.
Two trends that rarely occur simultaneously are impacting the market. First, home prices continue to rise. The Miami Association of Realtors says that the median price of a single-family home in Miami-Dade County rose 7.1% in January from the same month of 2024. Why? The association says there is demand from outside the region, especially for the most expensive residences.
At the same time, homes are sitting on the market longer, 45 days in January versus 32 days a year earlier. Equally important, the supply of homes for sale rose to 14.2 months from 9.6 months in the same 12-month period. The figures are rising in other counties.Put the numbers together, and it’s no surprise that sellers aren’t budging on price.
If you’re hoping for a break on mortgage rates, you may be out of luck. Inflation shows no signs of rising slower or dropping in the coming months. The odds are that rates will stay in the 6% to 7% range they have been for the past year.
So, what can you do as a buyer with more home choices but little expectation of lower prices or mortgage rates? Negotiate with the buyer on fees. Bankrate estimates that closing costs amount to 4%. On a home selling for $640,000, that’s $25,600 out of pocket.
Tropical Financial Credit Union helps members save money through its HomeAdvantage program with its CashRewards and first-time buyer program.
Seller concessions can lessen the financial pain. They help a deal go through without changing the home sale price.
Here’s how the seller can help at closing:
- Pay charges from private companies, such as loan origination, appraisal and home inspection fees.
- Cover the cost of title insurance
- Prepay the buyer’s property taxes through the end of the year.
- Put money toward government recording fees
Buyers couldn’t ask for concessions when the South Florida residential real estate market was red hot. Homes received bids the day they were listed, and sellers sometimes received offers well above the asking price.
Things have changed. More homes are available, but they are taking longer to sell. An owner who wants to “get the deal done” is more willing to work with a ready and lender-qualified buyer to close with few or no contingencies.
As a buyer, you can help your cause by showing the seller other recent deals that include concessions. Ask your real estate agent to help you create examples to kickstart negotiations. Now is the time to leverage concessions and creative deal-making to get the best possible value in South Florida’s evolving real estate landscape and Tropical Financial is here to help.