Florida’s once-booming housing market is experiencing a significant cool-down, transitioning from a seller’s to a buyer’s market. This shift is characterized by a surge in housing inventory, a notable increase in price reductions, and a decrease in sales, signaling a broader market correction across the Sunshine State.
Florida’s Housing Market Takes a Turn
Florida’s housing market, which saw rapid appreciation during the pandemic, is now facing a significant correction. Data indicates a substantial increase in active listings and a rise in price reductions, particularly in major metropolitan areas. This trend is driven by a combination of factors, including affordability issues, rising costs for homeowners, and a decrease in demand.
Key Takeaways
- Increased Inventory: Active listings across Florida have soared, with a 32% year-over-year increase in May, reaching 181,822 listings. Some metros, like Lakeland-Winter Haven, have seen an 80% increase in inventory compared to May 2019.
- Price Adjustments: Florida dominates the national landscape for price reductions, with 7 of the top 10 markets for slashing home prices located in the state. North Port, Tampa, Cape Coral, and Jacksonville are among the cities with the highest share of price cuts.
- Shift to Buyer’s Market: The increased inventory and softening prices indicate a clear shift towards a buyer’s market, especially for condos and townhouses, which have a 9.7-month supply of inventory statewide.
- Affordability Challenges: High prices, coupled with rising mortgage rates, homeowner association fees, and property insurance, have led to demand destruction, making homeownership unaffordable for many typical households.
- Condo Market Impact: New building safety legislation, enacted after the Surfside condo collapse, is contributing to the downturn in the condo market, as many older buildings face massive assessments for repairs, prompting some owners to sell at a discount.
Regional Impacts and Trends
The cooling trend is widespread across Florida, affecting various metropolitan areas differently:
- South Florida: Active listings in the tri-county area have quadrupled since 2022, reaching nearly 52,000 in April. This surge is attributed to locals being priced out, fewer new residents relocating, and current homeowners opting to sell due to rising costs.
- Sarasota and Manatee Counties: These areas have experienced some of the steepest declines in home values nationally, with Sarasota County seeing a 7% drop and Manatee County a 5% drop over the past year. This region, heavily reliant on
Sources
- Housing market hitting the brakes? New analysis finds Florida dominates areas slashing home prices, Florida Politics.
- Inventory of Homes for Sale in the Biggest Florida Metros Piles Up to Highest in Years as Demand Has Withered
| Wolf Street, Wolf Street. - Buyers Gain Ground In Florida Housing Market – NMP, National Mortgage Professional.
- South Florida Homes for Sale Quadruple As Residents Leave En Masse, Newsweek.
- Florida’s Suncoast sees steep drop in housing market values, Miami Herald.