These days, when discussing homes in Jacksonville, there's a recurring question: Why aren't home prices dropping significantly despite interest rates being in the 7% range?

The clue lies in the inventory. The number of homes on the market has noticeably decreased over the past year.

First, let me clarify the reference point. The latest month for sales statistics I checked is September, while rental statistics are available up to October. I couldn't find October sales data, so I'll analyze the market using September figures.

According to Realtor.com, the active listings in the Jacksonville metropolitan area stood at 7,799 in September. Active listings refer to homes currently available for purchase.

In September of last year, there were 9,035 listings, which means a decrease of 13.7%. This drop is larger than expected, prompting me to double-check the numbers.

A piece from Home Buying Institute, citing the Realtor.com report, states that this decline is the largest among the 50 major metropolitan areas in the U.S. I haven't seen the original source, so please take this as a reference.

Focusing on Duval County, the NEFAR (Northeast Florida Association of Realtors) September report shows 3,139 listings, with a supply of 3.8 months.

If you're unfamiliar with the supply months, think of it this way: If no new listings come onto the market, this is the time it would take for the current inventory to run out at the current sales pace.

In last year's October report, Duval had 3,936 listings with a supply of 4.5 months. While it's not a precise year-over-year comparison due to the different months, the trend is clear.

Now, let's look at prices. The median price for single-family homes in Duval in September was $345,000, which is a 3.6% increase from August, while the overall median for the six counties rose by 1.1% to $399,000.

However, the asking prices tell a different story. The median asking price in the metropolitan area was $379,000 in September, down 3.9% from $394,500 a year ago.

In simpler terms, while the asking prices have decreased, the actual transaction prices have not dropped significantly. However, these two statistics cover different areas, and the sales prices can fluctuate based on which homes sold during the month. It's premature to conclude that there's a clear upward trend based solely on the 3.6% increase.

In fact, transactions have cooled off. Duval's September sales totaled 830, down 9.1% from August, and the median days on the market increased by 16% to 29 days.

The interest rates provide some context. The average 30-year fixed mortgage rate from Freddie Mac was 7.40% on October 8 and 15, and 7.32% on the 22nd.

With inventory decreasing and prices holding steady, the market has seen fewer buyers due to the interest rates. It seems both sides are cautious.

As for rentals, we have October figures. According to the Apartment List November report, the median rent in Jacksonville is $1,318, which is a 0.3% decrease from October but a 0.8% increase from a year ago.

By bedroom type, the rent for a one-bedroom is $1,108, and for a two-bedroom, it's $1,304. This is 4.8% lower than the national median of $1,384.

Matthews' third-quarter apartment report shows an average rent of $1,488. The difference arises from the criteria and methods used for data collection. To track trends, it's safer to follow one source.

In the same report, the vacancy rate is at 6.0%, down 0.42 percentage points from a year ago, with 4,129 units under construction. The average rent is still 4.0% below the peak of $1,550 in the third quarter of 2022.

Even within Jacksonville, conditions can vary significantly depending on the area. The vacancy rate is lowest in Baymeadows at 4.9% and highest in Northside at 8.7%. The highest rent increase was in Westside at 3.5%, while St. Augustine and the Beaches area saw a decrease of 0.3%.

If you're a tenant, check the vacancy levels in your neighborhood before renewing your lease. If there are many vacant homes, there may be room to negotiate on the increase.

This month's biggest issue is taxes. Amendment 3 passed unofficially with 62% in the November 3 vote, surpassing the 60% threshold needed.

The homestead exemption is a program that reduces the taxable value of the home where I actually reside. The exemption will increase to $150,000 in 2027 and $250,000 in 2028, excluding school taxes, which remain at $25,000.

This change does not affect the 2026 tax bill you currently receive. The changes will be reflected starting with the November 2027 bill. If you pay in November, there is typically a 4% discount, so check the date on your bill.

If you're considering moving from another state, the timing is crucial. If you are not a permanent resident of Florida by December 31, 2026, the increased exemption will only apply starting from the fifth year of the exemption. You should also consider tax issues from your previous state.

There are also changes for those with rental properties or second homes. The annual assessment cap on taxable value will decrease from 10% to 5%, excluding school taxes. However, this is a cap on assessed value, not a cap on tax rates, so it doesn't necessarily mean taxes will decrease.

The city of Jacksonville estimates that this amendment could reduce tax revenue by over $300 million annually. While it's nice to see taxes decrease, we will need to monitor how the city budget adjusts.

If I were looking to buy a primary residence, I wouldn't just wait for interest rates to drop. I would consider negotiating on homes that have already lowered their asking prices or have been on the market for a while. The tax implications vary by individual circumstances, so be sure to consult a tax professional.

For investment purposes, I would calculate rental increases conservatively. A 0.8% increase year-over-year makes it challenging to offset the 7% interest rates with rental income.

The next figures to watch will be from NEFAR's October report. Just observing whether Duval's supply months shift from 3.8 months will give insight into who holds the negotiating power this winter.