It’s exactly what you want to see in a housing market – sellers are ready to sell, and buyers are ready to buy. Home prices are dropping, inventory is rising, and mortgage rates are expected to level off, but some experts are warning that it might not last long. Here’s what you need to know about Florida’s housing market today.
The Right Time To Buy A Home In Florida
According to Zillow, the average cost of a home in the Sunshine State is $392,306. That number might be up three percent over the past year, but that shouldn’t stop Florida homebuyers from making an offer on their dream property this year.
That’s good news for a state that saw more than 300,000 new residents in 2023, and another 225,000–275,000 are expected to make that move in 2024. If you’re one of those people, now might be the right time to buy a home.
Market Experienced Boom During COVID-19
In September 2019, before the COVID-19 pandemic wreaked havoc on the housing market, the average cost of a home in Florida was just over $240,000. By September 2022, that average was as high as $385,000.
The sudden increase in home value was attributed to a lack of supply and a rise in demand. More people were interested in buying a home as mortgage rates declined, but they were met by a lot of competition – which resulted in bidding wars.
Market Started Correcting Itself By Fall 2022
Between Fall 2022 and Spring 2023, home prices started dropping at a modest rate. Mortgage rates skyrocketed, and, all of a sudden, no one was interested in buying a home – and those who were, were willing to wait.
This period was known as the ‘market correction’ stage. And it wasn’t just home prices that were dropping – inventory was dropping as well. Not only were buyers willing to wait to buy, sellers were willing to wait to sell, sending the Sunshine State into a stalemate.
Market Is Starting To Pick Back Up, But At Slower Pace
Home values in Florida are still higher than the national average, which is around $347,000 currently, but the rate at which they’re increasing is slowing—and that’s welcoming news for anyone interested in buying a home.
In fact, Zillow predicted at the start of 2024 that home prices would soften, and it’s now giving homebuyers the motivation (and confidence) they need to start putting offers on their next home.
Sam Yaffey Credits Hurricane For Inventory Increase
In an interview with NBC-2, Sam Yaffey – a realtor in Cape Coral – spoke about the recent rise in inventory, and how it’s affecting buyer confidence in Florida. Believe it or not, Yaffey says the recent hurricane is playing a role in the rebound.
“We’ve got a little bit of a hangover with the hurricane [Idalia in August 2023], with people having to repair their homes before they could sell them and a whole bunch of things like that. So, we have a sudden increase in inventory once everybody suddenly got their houses fixed,” he said.
Yaffey Says Not To Wait Too Long Before Making A Move
While Yaffey believes now is the right time to buy a home in Florida, he’s warning homebuyers not to get greedy – especially if they plan on waiting for interest rates to drop. If you wait too long, you might not get the deal you were hoping for.
“If they wait when the interest rates drop, all the buyers that have had uncertainty are going to swarm in, and then the sellers will probably be in a multiple offer situation,” Yaffey told NBC-2.
Homeowners Are Reducing Prices Across The State
One of the things we’re seeing in Florida right now is a rapid reduction in home prices across the state. As of March 4, there were a total of 202,463 properties on the market and 47,335 of them featured a price reduction – that’s more than 23% of the homes available.
Fast forward one month, and those numbers are increasing. As of April 4, there were a total of 206,059 properties on the market and 50,401 of them featured a price reduction. It shows the increase in inventory, but also the rise in reductions.
Inventory Will Continue To Rise Due To Building Boom
According to the U.S. Census data by Construction Coverage, more than 212,000 new single-family housing units were authorized in Florida in 2022. Texas was the only state with more – but keep in mind Texas is nearly five times larger than Florida.
“The rate of new construction authorizations in the Sunshine State per 1,000 existing homes (21.1) is nearly double the national rate (11.7),” Justin Paprocki wrote in an article published by Golfshore Business. This building boom is helping to satisfy the rise in demand.
Texas Also Seeing Much-Needed Increase In Inventory
Florida isn’t the only state in the middle of a building boom. In fact, Texas is in the middle of a much larger boom – accounting for more than 22% of the new homes built in the US between 2010 and 2022 (2.5 million homes were built in Texas during that time).
“It is unsurprising that Texas has topped the study for new-build properties. Gaining more new residents than any other state between 2000 and 2022 with over 9 million, the rate of housing construction has increased to meet the state’s demand,” said a spokesperson from RubyHome.
What Should Sellers Do If Their Home Isn’t Selling?
If you’re having a hard time selling your home, Yaffey suggests hiring a good real estate agent, educating yourself on the current market in Florida, and (perhaps most importantly) be patient. Don’t expect the right offer to come right away.
“I’ve had houses sell in a week. I’ve had houses linger for a while. It’s just a mixed bag. It’s about timing to get everything done appropriately, have good photography, and a whole bung of other things involved in great marketing,” Yaffey added.
One Florida Homeowner Details Her Struggle
One Florida homeowner—Sharyn Olander, who owns a waterfront home in Old Bridge Village in North Fort Myers—detailed her own struggle with selling her home in an interview with NBC-2.
She originally tried to sell it after the hurricane last year, but was humbled by a lack of quality offers. She eventually gave up, but decided to try again this year – hoping the market would be a little kinder to her.
Still Having A Hard Time Selling
Unfortunately for Olander, she hasn’t had any serious bites since December – despite dropping the price three to four times. She’s now at a point where she can’t lower it any more, but people still aren’t showing any interest.
“When you put it on the market, you get really excited. You’re looking forward to getting out of a new place and into a new chapter. When no one comes, then you get really depressed and down.” said Olander.
