Florida Housing Market: Emerging Vulnerabilities and Trends

Parts of Florida’s housing market are increasingly showing signs of vulnerability, raising concerns among homeowners and potential buyers alike. According to ATTOM’s recent Quarter 3 2024 Housing Market Impact Risk Report, certain counties in the Sunshine State have now entered the list of the most at-risk housing markets in the U.S.

Key Insights from the Report

• Vulnerable Counties: Florida is now among states experiencing significant risks in its housing sector. Two-thirds of the 50 most at-risk counties are located in California, Illinois, New Jersey, and Florida, elevating concerns about price declines in the region.

• Market Performance: The state’s home buying activity plummeted by 10.2% from October 2023 to October 2024. Contributing factors include:

  • Rising insurance costs due to extreme weather.
  • New safety regulations.
  • The aftermath of recent hurricanes, which have caused billions in damages.
• Current Median Prices: Despite the decrease in transactions, the median sale price in Florida increased by 1.3%, bringing it to $410,000.

Foreclosure sign in front of a home in Miami, Florida. (Image Credit: Joe Raedle/Getty Images)

Reasons Behind Market Vulnerability

1. Insurance Cost Surge

Florida homeowners face escalating insurance premiums largely driven by recent severe weather events. For example:

• Hurricane Helene: Estimated damages reached $1.4 billion.
• Hurricane Milton: Resulted in damages of $2.4 billion.

2. Underwater Mortgages

Florida’s Marion County specifically stands out with 11% of mortgages classified as underwater, meaning homeowners owe more than their property’s estimated value. In comparison, the national average is 5.5%.

3. High Foreclosure Rates

Charlotte County has alarming foreclosure statistics, with one in every 449 residential properties facing potential foreclosure, compared to the national rate of one in 1,618.

What It Means for Homeowners and Buyers

While the report highlights vulnerabilities, it also offers potential opportunities for prospective buyers. However, homeowners in affluently impacted areas may experience anxiety over property value stability.

Expert Opinions

Rob Barber, CEO of ATTOM, notes:

“The recent market risk patterns changed a bit in the third quarter… But the big picture remained pretty much the same around the country.”

Lawrence Yun, chief economist at the National Association of Realtors, offers a more optimistic view:

“Home prices are on firm ground in nearly all markets… It’s very doubtful that there will be any meaningful price declines.”

Areas of Resilience

Despite the warnings, the report suggests that some counties, especially in the South, are more resilient. The ongoing national housing inventory shortage, with listings still 30% below pre-COVID levels, can provide a buffer against market downturns.

Conclusion: A Market Under Observation

While parts of Florida’s housing market show vulnerabilities, a complete downturn might not be imminent. ATTOM’s report encourages ongoing vigilance from homeowners and buyers alike, highlighting that some markets may just be undergoing temporary setbacks.

For more details about the housing market and its trends, visit ATTOM or check resources from the National Association of Realtors.

This article aims to provide clarity and engaging insights into Florida’s evolving housing landscape. Stay informed about ongoing changes to make the best decisions for your housing needs.