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Business of the Week: Selective Realty

Central Florida Buyers’ Bidding Wars Ease a Bit as Inflation
Starts to Show its Face.

By Selective Realty Group

A survey of Orlando realtors found a slow but steady drop in the percentage of listings engaged in a bidding war. In April, 74.1% of sellers entertained multiple bids; in May it dropped to 72.1%; and in June, it fell to 66.2%. But other Florida cities like Sarasota tops the list of U.S. bidding-war cities at 87%.

Orlando – While the U.S. remains in a strong sellers’ market, the buyer competition seems to be easing a bit as home prices continue to rise.

For anyone with concern as prices surge for everything from food and gas to airplane tickets and clothes, the message from Federal Reserve Chair Jerome Powell over two days of congressional hearings this week was straightforward: Just give it more time and those price gains should slow, or even reverse.

For anyone with concern as prices surge for everything from food and gas to airplane tickets and clothes, the message from Federal Reserve Chair Jerome Powell over two days of congressional hearings this week was straightforward: Just give it more time and those price gains should slow, or even reverse.

For anyone with concern as prices surge for everything from food and gas to airplane tickets and clothes, the message from Federal Reserve Chair Jerome Powell over two days of congressional hearings this past week was straightforward: Just give it more time and those price gains should slow, or even reverse.

The Fed chair acknowledged that the U.S. is in the midst of an unparalleled economic reopening on the heels of a pandemic-induced recession, making it that much more difficult to anticipate how things like inflation and unemployment will play out.

“This particular inflation is just unique in history,” Powell said Thursday before the Senate Banking, Housing and Urban Affairs Committee. “We don’t have another example of the last time we reopened a $20 trillion economy. We’re humble about what we understand.”

Powell said inflation may slow “in six months or so,” suggesting a clear reading on inflation won’t come until the end of the year.

The central bank’s policymakers have said they’re prepared to accept inflation above its target to make up for years of inflation below 2%.

Powell acknowledged Thursday that inflation is currently well above 2%, adding “of course we’re not comfortable with that.” But he noted that unemployment also remains elevated at 5.9%, and argued that the Fed doesn’t want to raise interest rates to counter what it sees as temporarily higher prices.

The Fed is also purchasing $120 billion a month in treasuries and mortgage-backed securities, which are intended to keep longer-term interest rates low to encourage borrowing and spending. The Fed has started discussing its timeframe for reducing those bond buys, Powell said and will continue to do so at its next meeting in two weeks.

Some economists believe that the Fed will likely announce a reduction in those purchases as soon as September, though others argue a November or December announcement is more likely.

“The first half of this year was red hot – it was almost impossible to get an offer accepted. But recently, we’ve started to see buyers get cold feet,” says Michael Vergantino, a Selective Realty Group agent. “Two of my buyers just had their offers accepted because the sellers’ first buyers backed out. The market is still competitive, but buyers are more trepidatious than they were at the start of 2021 and less willing to pull out every stop in order to win.”

Selective Realty Group agents report that more buyers are starting to keep contingencies – a sign that competition is beginning to abate.

For a Free Buyer’s or Seller’s guide that includes a comparable market analysis and/or buyer’s resource guide for first-time home buyers, please do not hesitate to contact us today!

 

Selective Realty Group
[email protected]
407.627.1727
3801 Avalon Park Blvd. East, Suite 229
Orlando, Fl  32828

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