Florida’s once red-hot housing market is experiencing a significant cool-down, shifting power from sellers to buyers. Inventory is on the rise, prices are stabilizing or dropping in many areas, and affordability concerns are reshaping purchasing decisions. This marks a notable change from the pandemic-fueled boom.
Key Takeaways
- Florida’s housing market is transitioning from a seller’s to a buyer’s market, particularly for condos.
- Condo sales have seen significant declines, driven by rising association fees, stricter financing, and post-Surfside structural integrity requirements.
- Single-family home sales are also slowing, but prices remain more stable than condos, with some areas still seeing appreciation.
- High mortgage rates, increased insurance costs, and general affordability issues are major factors impacting sales across the state.
- Inventory levels are increasing statewide, offering buyers more choices and negotiation leverage.
Condo Market Faces "Real Pain"
The condominium market in Florida is experiencing a pronounced downturn. Sales plummeted by 25% in Miami-Dade and 24% in Broward in May compared to last year. This decline is attributed to several factors, including rising association fees due to new reserve requirements post-Surfside collapse, difficulty securing financing for older buildings, and high mortgage rates. While luxury condo sales remain strong, the mid-tier market is struggling, leading to a significant increase in condo inventory.
Single-Family Homes See Slower Sales, Stable Prices
While not as dramatic as the condo market, single-family home sales are also slowing across Florida. Statewide, closed sales dropped 7% in February year-over-year. However, median prices for single-family homes have remained relatively stable, with some areas still seeing slight increases. The market for single-family homes is described as moving towards equilibrium, with inventory rising and buyers gaining more leverage, though it still generally favors sellers more than the condo market.
Affordability and Inventory Shift Market Dynamics
Affordability remains the primary impediment to sales growth. High mortgage rates, hovering around 7%, coupled with increasing insurance costs, are making homeownership less accessible. This has led to a significant increase in active listings across the state. In February, single-family home inventory was up 31.6% and condo-townhouse inventory rose 36% compared to the previous year. This growing supply, combined with hesitant buyers, is creating a more balanced market where buyers have more choices and negotiation power.
Sources:
- ‘Real pain’ in South Florida condo market while home prices are steady, WLRN.
- Condo sales struggle in Miami but luxury market thrives, Miami Herald.
- A look into Florida real estate market, home sales slowdown, WUSF.
- Buyers Gain Ground In Florida Housing Market – NMP, National Mortgage Professional.
- Buyers Gaining Ground as Market Shifts, | Florida Realtors.