A Comprehensive Overview of the Florida Housing Market
Are you considering buying or selling a home in Florida? You’re not alone. According to data from realtor.com, Florida has been the most popular state to move to for the past two years. So, is now a good time to buy a house in Florida? When will housing prices drop? Read on for the latest data, insights, analyses, and state housing market predictions for 2024.
Migration Trends: Where are Americans Moving?
Florida boasts five of the top 10 areas in the country that people are moving to, including Orlando (#3 on the list with a net inflow of 4,000 between July and September 2023), Sarasota (#5, 3,700 net inflow), Tampa (#7, 3,400), Cape Coral (#7, 3,300), and Miami (#9, 3,200).
Florida Areas with the Largest Inbound Move Rates in 2022
According to the National Association of Realtors, the Florida areas with the largest inbound move rates in 2022 were Ocala (ranked #1 in the country, with an inbound move rate of 57.1%), Tallahassee (#2 on the national list, 56.6% inbound move rate), Deltona (#6, 55.7%), and Miami (#9, 55.2%). In fact, Florida was the top state for most net domestic migration gains (318,855) in 2022, and it was also the fastest-growing state last year, with an annual population jump of 1.9% within a year.
Florida Housing Market Overview
Based on sales and sale prices, the experts agree that Florida remains a robust statewide market for real estate, although sellers have had to adjust to decreased buyer demand in recent months. According to Michelle Baydemir, a Kissimmee-based Real Estate Broker and vacation home/investment property specialist, “Home prices remain high compared to historical norms that have started to decline from peak levels reached earlier in 2022.” However, Michelle also believes that buyer confidence and relative sales will remain high in Florida because the alternative of waiting for a lower mortgage rate will likely not happen anytime soon.
Will Home Prices Drop in Florida in 2024?
While it’s difficult to predict where Florida home prices will land in 2024, current trends provide some path to prognostication. Matt Dunbar, senior vice president of the Southeast Region for Churchill Mortgage, says, “there’s little evidence to suggest a significant reduction in Florida’s residential real estate prices is happening in the near future.” Michelle at Vacay & Co Real Estate states that she believes that by the end of 2024, Florida values will rise 3% to 4% year-over-year.
Buying a Home in Florida
Despite the challenges, purchasing a home in the Sunshine State is still a worthwhile investment. Inventory levels are still low, and there continues to be a steady flow of new residents to Florida on a daily basis. It remains a good time to buy in Florida, or anywhere, if you plan to live in the home long-term.
Michelle feels that Florida homes should continue to increase in value into next year, especially due to continued population growth, “but home value and price gains will likely be smaller in 2024 than in recent years. It remains a good time to buy in Florida, or anywhere, if you plan to live in the home long-term. Just expect smaller returns on home appreciation and value next year than in the past two years.”
Here are the 10 most competitive Florida cities, Redfin report:-
- Oviedo
- Alafaya
- Ocoee
- Largo
- Sanford
- Altamonte Springs
- Pinellas Park
- Winter Springs
- East Lake
- Horizon West
Selling a home in Florida
As the earlier numbers suggest, most home sellers in Florida can still expect a relatively healthy sale price, with median and average sale prices up 2% and 3.7% year-over-year.
But with continued costly mortgage rates and low housing inventory, it can be challenging for many sellers to get desired offers or to sell their properties quickly (the median time to contract is currently 27 days, up 68.8% since a year earlier, and the median time to sale is 69 days, a rise of 21.1%).
According to Redfin, here are the 10 Florida metros with the fastest-growing sales price:
- Lauderhill 60.5%
- North Miami Beach 45.1%
- Palm Beach Gardens 38.9%
- Destin 38.4%
- Tarpon Springs 36.4%
- Winter Garden 34.4%
- Marco Island 28.7%
- Oakland Park 28.6%
- Coral Springs 28.3%
- Davie 23.0%
Florida market predictions: Will it crash?
It’s doubtful that a housing market recession or real estate sector crash will occur in 2024.
Michelle states “Florida markets have been suffering from low inventory all through 2022 and 2023, increasing our home values. Builder inventory hasn’t kept up through 2023 due to fears that homes will not be affordable with higher interest rates,” notes Lehman. “This has further kept inventory low. I believe we will see forced situations of homes for sale in the last quarter of 2023 and 2024, triggered by bank forbearance situations that are now due. This will increase our supply of homes to more normal levels – levels that will not precipitate a market crash.”
“A housing recession in Florida next year is unlikely. But price drops are possible in overheated areas. Overall, the market should see a normalization,” he says.
Will 2024 be a buyer’s or a seller’s market in Florida?
“All things considered, while the 2024 Florida real estate market remains tilted in favor of sellers due to existing homeowners’ reluctance to list, the integration of new construction inventory may begin to bring a more balanced dynamic, offering prospective buyers a breath of fresh air,” Dunbar says.
Michelle notes that buyer demand in Florida has moderated in recent months but remains relatively strong due to Florida’s growing population, job market, and popularity as a retirement destination.
“Bidding wars are less common than last year. And home appreciation has slowed dramatically. Price cuts have become more common as sellers adjust to shifting conditions. This indicates the market is rebalancing in favor of more buyers,” he says.
Lehman agrees.
“As our ongoing issues of high mortgage rates and low housing supply hopefully ease off, we will start to equalize. But I believe we will begin to see more of a buyer’s market toward the end of 2023 and into 2024,” she adds.
The bottom line: 2024 Florida housing market outlook
Considering that median and average sale prices are higher than a year ago, it may be safe to assume that buyers will be paying more for Florida homes next year. However, the market can change quickly, and price corrections in key metros are already happening. That may continue—particularly if mortgage rates rise while inventory levels increase.
If you’re interested in buying a Florida residence in the coming months, it’s smart to keep an eye on price and rate trends and work closely with a trusted and experienced and fully Licensed Real Estate Broker or Realtor who can help you find the right property at the right price.
News Source: Real Estate Real Estate Biz Orlando