Which phase of the market cycle is Jacksonville Florida?

[Seavron Banus]

There is a lot of talk about Jacksonville, FL as a "hot" market for investment. Forbes wrote an article in early 2017 which put JAX high on the list of good places to invest (based on job growth, unemployment, foreclosures, etc.). As investor I see both the positive trends, and a market that is getting so much attention that deals are harder to come by.

Rents seem to be going up, but for how long?

For anyone who is also investing in the area, tracking metrics like price per foot, etc. where do they think the market is right now?

Looking to start a good data backed discussion, let's hear your thoughts!

[Gregg Cohen]

Months of inventory in Jacksonville is very low.  This tracks the # of houses on the market divided by the # of houses that sold last month.  Below 6 MOI is an indicator of higher than normal appreciation in the short run.  About 7 indicates lower than normal appreciation.  From 1978 to current, the avg appreciation rate in Jacksonville is 3.8% so we deem that “normal.”  MOI has been in the 4-6 range since 2013 so it’s not surprising that we’ve seen above avg appreciation since that time.  And MOI is much lower today.  Dipping into the 2’s.  You’re going to see prices going up in Jax until supply increases.  But building in the middle income and below middle income neighborhoods hasn’t happened much in recent years because prices aren’t high enough for a builder to make a profit.  Prices need to go up to give an incentive for builders to increase supply. We’re expecting higher than normal appreciation in the short run in Jax (12-18 months.). Hope this helps!