High Demand and Low Inventory: Pensacola’s Hot Residential Market
By Jonathan D. Scull, Broker/Owner of Hanban Real Estate LLC & 2022 President of the Pensacola Association of REALTORS®
“THE PENSACOLA AREA REAL ESTATE MARKET IS HOT!” How many times have you heard this in the past few years? What exactly does a “hot” market look like? How does it affect everyday individuals? Will the market stay this way? Let’s first compare four categories of statistics provided by the Pensacola Association of REALTORS®, Inc. for the month of January, dating back to 2019. These categories include average number of days on the market (DOM), average sold price, inventory and sales volume. In addition, we’ll take a look at numbers within the rental market as well as the growing competition between cash buyers and buyers utilizing a common mortgage loan.
The average DOM is defined by the day a home is listed publicly up until the day a seller accepts an offer. Looking back to January 2019, the average DOM was 67 days. Compare that to January 2020, with an average DOM of 62 days; January 2021, at 44 days; and January 2022, at 25 days. Over three years, the average DOM went from more than two months to less than a month. With that perspective, homes are flying off the market in 2022, compared to 2019. The average sold price in January 2019 was $235,848. Compare that to January 2020, at $240,610; January 2021, at $298,192; and January 2022, at $356,530. As you can see, the average cost of a home has increased a whopping $120,682 within the past three years. Rising home costs is another sure sign of a hot real estate market. Inventory is certainly an important factor to note when observing the real estate market. The following statistics refer to the number of homes still available for purchase at the end of the month. At the end of January 2019, inventory stood at 2,387 homes. January 2020’s inventory stood at 2,051 homes; January 2021’s 13
