April may not have been the cruelest month for Florida’s housing market, but it wasn’t entirely pleasant. Last month, Florida Realtors reported a 20.7% year-over-year drop in closed sales of single-family homes and a 36.5% plummet in condo-townhome sales during the same period.

Furthermore, Florida Realtors reported new listings in April were down over 27.2% year-over-year in the single-family category and were down 38.5% for the condo-townhouse sector. New pending sales for April took a 35.1% drop in the single-family category from one year earlier and pending sales in the condo-townhouse category sank by 56.6% from April 2019.

“We were going into March really strong,” said Brad O’Connor, chief economist with Florida Realtors. “We were having a great January and February, and people were talking about how the winter buying season that we have down here was actually starting early late last year, compared to what it usually does.”

But there’s some evidence that April will end up being the bottom, and that home sales in Florida are already rebounding. The statewide median sales price for both single-family homes and condo-townhouse properties rose year-over-year for the 100th consecutive month: up 6% to $275,000 for single-family existing homes and up 7.7% to $209,000 for condo-townhouse units.

O’Connor thinks the state’s housing market is poised to snap back but just needs more properties on the market.

“Where we’re at right now in May, it’s looking like sales levels are really not that far off from what we had last year,” he said. “But our concern is that listings have not come back by as much as before, so that could exacerbate the shortage going forward and potentially put a cap on sales later on.”

The hope for a resilient near-future is a common theme among Florida’s housing and mortgage professionals. Grant Stern, president of Morningside Mortgage Corp. in Bay Harbor Island, observed several “unique challenges” where buyers and sellers worked around pandemic protocol obstacles in pursue of a transaction.

“I’ve seen sellers refuse to give entry to the property until they have a contract agreed upon,” he said. “Buyers are spending more time doing drive-bys and taking them more seriously because you can’t go inside so easily. And there is one duplex where they actually did the opposite: They were negotiating to get inside or at least discussing getting inside and decided they would rather present an offer subject to the in-person inspection and then negotiate the rest later.”

Stern dubbed the pandemic-era Florida housing scene as a “market that rewards real estate agents and brokers who are flexible about contract terms and who are looking to make deals, and it punishes real estate agents who grandstand during the course of these homebuying transactions, which are pretty routine.”

Sophia Sanchez, owner and broker at Sanchez & Co. in Tampa, is among the real estate agents eager for deals.

“We have a supply and demand issue,” she said. “According to our local board, our inventory was down in February by 23%. And you have a lot of people hesitating to put their homes on the market, either because their relocation plans have changed or they don’t want to move or they can’t travel. So, there’s a big pent-up demand issue of not having enough housing. I think by calculations we’re down 51% on available inventory in the Tampa market.”

Sanchez added that despite restrictions on the real estate market, such as the temporary suspension of open houses and the heavy reliance on 3D tours instead of in-person inspections, “there are multiple offers coming in on properties, just because there’s not enough to buy and some people that need to buy don’t want to rent.”

Lynda Fernandez, chief of communications and global for the Miami Association of Realtors, pointed to a similar situation in her local market.

“We’re hearing our members are very busy,” she said. “In fact, we’re back to bidding wars, particularly for single-family homes.”

Fernandez was also optimistic that the worst of the crisis could now be seen in the rear-view mirror, adding, “I think it’s safe to say our market bottomed and now we’re seeing incredible activity like close to what it was before.”

On the mortgage side, Florida mirrors the rest of the country with refinancing taking on a dramatic dominance over the purchase market.

“Rates are at a record low, so homeowners are taking advantage of that,” said Michael Azzarello, Southeast Region correspondent sales director at Caliber Home Loans in Jacksonville. “They’ve built up some equity over the years. That’s working out for those that are originating loans.”

But Azzarello, who is also president of the Mortgage Bankers Association of Florida, is facing a new concern on determining borrower eligibility, warning that the “biggest issue is unemployment – lenders are being very cautious of what type of loans they’re making today. Lenders are very concerned about unemployment and the potential for forbearance that has occurred and will continue to occur.”

In some ways, Florida differs from many states in certain aspects of its real estate scene. Luxury housing has been a major piece of the housing environment, but the ongoing crisis has created problems due to the shrinkage of the jumbo mortgage space.

“Jumbo loans are pretty much very limited now to just a few of the larger depository bank lenders,” said Azzarello.

Morningside Mortgage’s Stern finds the same difficulty, stating that “the jumbo market is thawing, but it’s not back to where it was two months ago.” Stern noted that while some local banks are “just kind of taking a wait-and-see approach” before resuming jumbo origination, he has been creating alternative vehicles for the traditional jumbo customer, such as a “first mortgage through our VIP banking relationship with Quicken and then the second mortgage with a dedicated home equity lender.”

International buyers for local residential real estate have also been absent during the pandemic. Although Florida Realtor’s O’Connor explained that activity by foreign buyers had been declining nationwide because “many economies around the world were moving into a struggling situation, whereas the U.S. economy was still strong,” the impact on Florida is acute. Between August 2018 and July 2019, foreign buyers generated $16 billion in sales for Florida’s existing home market, which is 12% of the dollar volume of this sector.

“I’m not seeing a lot of foreign buyers,” Stern said. “Usually around this time, there are 20 transactions in our pipeline. I think I have one foreign buyer.”

Another defining aspect of Florida’s housing market is the large number of seniors, particularly among retirees who migrated from other states. According to Gino Moro, owner of Southland Mortgage in Hollywood, the state’s reverse mortgage market is poised to expand due to the surplus number of seniors and an increased worry about financial stability based on the coronavirus tumult.

“There have a lot of loan officers that looked at the reverse mortgage when the purchase business dropped as an alternative program to use,” said Moro, who is also president of the Florida Association of Mortgage Professionals. “As we see more and more seniors move to Florida, reverse mortgages will be an absolutely phenomenal product for them.”

Moro added that as the state reopens further and the local economy gains strength, purchase loan activity will be driven by first-time homebuyers eager to get into homeownership.

“I’ve seen the interest,” he said. “Just in our office, we’ve seen a lot more phone calls from Realtors having first-time homebuyers asking questions about how to purchase and how to get ready for it. So, I think that’ll be a good a good influx in the next coming months.”