Affordable Homes – No Buyer!

This is the current scenario in South Florida. As history tells us, properties of South Florida region are always affordable for buyers to purchase. But the reality is that majority of the buyers can hardly afford most of the properties on sale.

properties on sale

The current monthly installment (mortgage principle + interest) is not higher than what the buyers had to pay during the years of 1985 to 2000. Besides, the value of properties on sale in South Florida is quite low than the average market price for homes. Still it is quite difficult to find a home to buy.

There are couple of reasons why majority of the buyers can’t afford properties in South Florida regions. First of them is the existence of many ‘underwater’ borrowers who are not able to sell. It resulted in decline in home sales in South Florida.

The current mortgage rate in South Florida region is quite low if you compare it with other regions. This is what is quite inspiring for buyers wanting to buy properties. But it is feared that the interest rate will increase by 5 percent by next year. And, if that happens there will be increase in spending for the buyers which could put a question mark on their affordability. A buyer with question mark on his/her affordability will think twice before he goes on to buy a property. And that’s the reality.

Real estate website Zillow has recently made a survey on the properties of the South Florida region and found that about 62 percent of the properties/homes on sale are not affordable for majority of the buyers in the area. Its chief economist Stan Humphries said in a statement, “housing in general is somewhat more affordable than it has been historically, but there are fewer affordable homes to actually buy”. “It doesn’t do you any good if things are affordable, but you can’t find a home”, he added.