The housing market in Florida has been making headlines as loads of people pack their bags and head south. Florida has led the country in net migration — people moving there from another state — for more than five years in a row, and the pandemic accelerated that population growth.
The state’s warm weather and relatively low cost of living makes it attractive for retirees, but it’s also a great spot for those still in their prime working years, whether they’re searching for an office environment or looking to log on from the beach.
While the state is clearly an appealing place to live, buying or selling a home here in 2023 looks much different than it did in the past couple of years. Mortgage rates have skyrocketed, and real estate doesn’t look quite as sunny anymore as homes stay on the market for longer. Read on for everything you need to know about the Florida housing market.
Florida housing market overview
Florida is big, covering more than 65,000 square miles. To get a sense of the pulse of buying and selling activity across the state, it’s important to remember that real estate is a hyper-local industry. What’s happening in Miami, where loads of wealthy out-of-staters have relocated, is much different than what’s going on in, say, Tallahassee.
And while the best places to live in Florida naturally include easy access to the beach, they also include inherent downsides and dangers, as evidenced by the horrific damage of Hurricane Ian along the Gulf Coast.Climate change could cause major long-term challenges for the Florida housing market: A recent report from McKinsey projected that some coastal homes could lose 35 percent of their value by 2050 due to rising sea levels.
Florida housing market trends and stats
Whether you’re looking to buy or sell a house here, here’s some helpful data from Florida Realtors to consider.
- Median sale price: In April 2023, the state’s median sale price was $410,000. That’s the same figure as the year before and slightly above the national median.
- Sale-to-list price: Back in April 2022, buyers typically paid the full 100 percent of a home’s list price. But in April 2023, buyers paid around 96.7 percent of the original list price — an indication that buyers are gaining more leverage in the market.
- Days on market: The median time to contract for a single-family home was 31 days in April, significantly longer than the typical 8-day timeframe of the year before.
- All-cash deals: Many Florida buyers do not need to secure financing for the deal. Of the 23,334 single-family homes sold in April, nearly 7,000 were purchased in cash.
- Closing costs: The state’s average closing costs total 2.3 percent of the purchase price, according to research from ClosingCorp. So, on a $400,000 sale, that’s an additional $9,200 in costs like title insurance, transfer taxes, appraisal fees and more.
Buyers and sellers in the Florida housing market
Is it a buyer’s or seller’s market in the Sunshine State right now? Well, kind of neither. A shortage of available inventory puts the power in the hands of the seller here, but rising mortgage rates mean fewer qualified buyers, and more closings for under asking price mean buyers do have some leverage. Here’s what to know, depending on which side of the table you’re on.
Selling a home in Florida
Florida sellers still have the upper hand in Florida, simply because there aren’t enough homes available to meet demand. In April, there was just a 2.6-month supply of single-family homes; 5 or 6 months is considered a balanced market.
However, there are warning signals that sellers should consider. For example, it’s taking nearly four times longer for homes to sell now than it did last year, and overall sales dropped by 17.2 percent, according to Florida Realtors. With that in mind, don’t get greedy with your pricing strategy right now — an elevated list price might scare off buyers, who are already feeling the pinch of higher mortgage rates.
Before you list, take steps to figure out what your house is worth, and price it competitively. You might even be able to attract an all-cash offer, which is common in Florida. West Palm Beach, Jacksonville and Fort Lauderdale are all in the top five cities in the entire country for all-cash offers, according to a Redfin report.
Buying a home in Florida
First, the good news: Prices here have held relatively steady in recent months. With inflation, that means that prices have fallen in real terms. Now, the bad news: They’re still pretty high. With a median price tag of $410,000, a 20 percent down payment for a typical Florida buyer would come to more than $80,000. However, if you have excellent credit, you might be able to put down a much lower percentage.
Many buyers have retreated in the current market conditions, so this may be a great time to avoid dealing with the high level of competition that shaped much of the past two years. If you go house hunting in Florida, keep these tips in mind:
- Compare cost of living: Keep in mind how much you’ll need to spend on other life essentials. The cost of living varies across Florida. For example, Bankrate’s calculator shows that life in Jacksonville is nearly 15 percent cheaper than in Fort Myers or Cape Coral.
- Get preapproved: Getting preapproved for a mortgage is a simple step that gives you a good idea of how much house you can afford. And having a preapproval letter means sellers will take you more seriously.
- Negotiate: The days of buyers waiving contingencies, engaging in bidding wars and doing basically anything to secure a home are gone. You aren’t at the full mercy of the market anymore — or at least not as much. Work with your real estate agent to make sure you aren’t offering more than you need to, and ask for concessions if your home inspection uncovers problems.
Florida housing market predictions: Will it crash?
Rising mortgage rates and persistent inflation have fueled worries of a housing market crash. But expert predictions for the country’s housing market, including Florida, do not foresee a crash. A cataclysmic drop in prices similar to the housing crisis of 2007 and 2008, when clouds of foreclosures hung over the Sunshine State, is very unlikely. Instead, the Florida housing market seems poised for a cooldown with a soft landing.
Different locations in Florida may also have very different market forecasts. South Florida and major cities like Miami and Orlando are in high demand and may be more recession-resistant than northern and more rural portions of the state. Median prices in particular metro areas can give you a good idea of what to expect: For example, per Florida Realtors, the April median in Sebring, right in the center of the peninsula, was just $266,000, and in the panhandle metro of Tallahassee it was $322,950. Whereas the Miami–Fort Lauderdale area saw median prices of $585,000, and in Naples, on the Gulf Coast, prices stretched beyond $900,000.
Find a Florida real estate agent
Whether you’re buying or selling in Florida, you shouldn’t try to navigate the market alone. Having an experienced real estate agent on your side can help you avoid mistakes ease the stress of negotiations and paperwork. Before you sign a contract with a Realtor, whether you’re looking in much-visited cities like Miami or Orlando or in less touristy parts of the state, interview several candidates to make sure you’re adding the right member to your team.
Important note about Florida homeowners insurance
- The home insurance market in Florida is in crisis. Since 2017, many insurance carriers have left the state, gone insolvent or tightened their underwriting restrictions, making it difficult for homeowners to find coverage. Many of the companies that remain have chosen not to renew existing policies, leaving owners in the lurch.
- Fraudulent roofing claims are mostly to blame, and the devastating effects of Hurricane Ian in September 2022 complicated the issue further. According to a report from the governor’s office, Florida accounts for 79 percent of the country’s home insurance lawsuits.
- New insurance-reform laws went into effect in 2022 to try to stabilize the situation, but it may be some time before these laws produce meaningful results, and homeowners could see premiums that exceed several thousand dollars a year. Before you buy a Florida home, consult closely with your real estate agent, and possibly a local attorney, to determine whether the property will be insurable at a cost you can afford.
FAQs
Over the past few years, home prices in Florida have skyrocketed. Per Redfin data, in the middle of 2020, the median sale price was $275,600 — by April 2023, that figure had jumped to $400,800. The state remains one of the top markets people move to, and its increasing population will likely keep the market robust.
There are both encouraging and discouraging signs on both sides. Migration to the state is high and prices have held steady despite rising rates, plus there is still a low supply of homes, all of which give sellers more power. However, homes have started to go for less than their list price, and they’re spending a much longer time on the market, which are positive signs for buyers.
FAQs
Lakeland, FL:
Overall, the Florida housing market is likely to remain strong in 2023, with continued demand for homes and steady price growth. However, the market may begin to stabilize as the growth rate slows down, which may lead to more balanced conditions between buyers and sellers.
What they say about the housing market in Florida? ›
Florida housing market trends and stats
Median sale price: In April 2023, the state's median sale price was $410,000. That's the same figure as the year before and slightly above the national median. Sale-to-list price: Back in April 2022, buyers typically paid the full 100 percent of a home's list price.
Will 2023 be a good time to buy a house? ›
Homebuyer.com data analysis indicates that, for first-time home buyers, June 2023 is a good time to buy a house relative to later in the year. This article provides an unbiased look at current mortgage rates, housing market conditions, and market sentiment.
Will 2024 be a good time to buy a house? ›
With mortgage rates declining faster than expected, home prices are likely to remain mostly flat throughout 2024. This will be good news for buyers who have been waiting on the sidelines for a good time to enter the market.
Why are people moving to Florida? ›
There are various reasons why people are moving to Florida. The most common ones include warm weather, affordable cost of living, and job opportunities. Additionally, many people are reevaluating their living situations and considering moving to areas with more space and outdoor activities.
Will home prices drop in Orlando Florida? ›
Will home prices drop in 2023 in Orlando? Due to an increase in inventory, home prices in Orlando may slightly decrease this year. Following the basic economic principle of supply and demand, the surge in supply will translate to more bargaining power for buyers.
Is Florida housing overvalued? ›
Florida metros make up six of the 10 most overvalued housing markets in the nation, according to the latest report from researchers at Florida Atlantic University and Florida International University.
Why are house prices high in Florida? ›
Florida is one of the most expensive states for housing, and Miami is the least affordable city in the country, according to a report. High demand, short supply, increased migration trends since the pandemic and exploding mortgage rates, make for a pricey combination.
Why is the housing market so expensive in Florida? ›
Florida is expensive because of its popularity among retirees and tourists. Retirees often have disposable income and spend it on activities like golfing, fishing, and boating. Additionally, housing, food, and healthcare costs are higher in Florida compared to other states.
Will mortgage rates go down in 2024? ›
Fannie Mae, Mortgage Bankers Association and National Association of Realtors expect mortgage rates to drop through the first quarter of 2024, by half a percentage point to about nine-tenths of a percentage point. Figures are the predicted quarterly average rates for the 30-year fixed-rate mortgage.
During a traditional recession, the Fed will usually lower interest rates. This creates an incentive for people to spend money and stimulate the economy. It also typically leads to more affordable mortgage rates, which leads to more opportunity for homebuyers.
Is it a good time to buy house in Florida? ›
The Current State of The Florida Housing Market in 2022
The fact is, the demand for Florida homes remains one of the highest in the nation, (even through years like 2022) due to Florida's weather, lower income taxes, & low property taxes. This helps to explain the increase in home prices particularly in Florida.
Will house prices go down in 2023 usa? ›
Although home prices are expected to improve in the second half of the year, the California median home price is projected to decrease by 5.6 percent to $776,600 in 2023, down from the median price of $822,300 recorded in 2022.
Will mortgage interest rates go down in 2023? ›
“[W]ith the rate of inflation decelerating rates should gently decline over the course of 2023.” Fannie Mae. 30-year fixed rate mortgage will average 6.4% for Q2 2023, according to the May Housing Forecast. National Association of Realtors (NAR).
Will 2026 be a good year to buy a house? ›
Housing Market Predictions 2026
A more conservative cohort predicts a more modest 10.3 percent growth in the same period. In addition, a mere 8 percent of poll participants expect the housing market to largely favor homebuyers in 2026.
Is Florida becoming overcrowded? ›
Over 70 percent believe Florida's overcrowding and overpopulation is a major problem. Nearly 60 percent believe that adding another five million people to Florida's population is a serious problem. Forty percent say Florida has become a less comfortable place to live over the past five years.
Are the rich moving to Florida? ›
More high-earners moved to Florida than to any other state between 2019 and 2020, per an analysis by SmartAsset of IRS data. It found that Florida saw a net influx of 20,263 households earning over $200,000 a year—nearly four times how many high-earners decamped to Texas, the second-most popular destination.
Is moving to Florida a good idea in 2023? ›
Florida is an excellent location if you're looking for work. According to Wallethub, Florida is the 14th best state to find a job. The unemployment rate in Florida was only 2.5% in December 2022. With the national unemployment rate at 3.4%, many people move to Florida to take advantage of opportunities in their fields.
Have Florida home prices peaked? ›
Florida Housing Market Overview
Looking at the five-year period from September 2017 to September 2022, the median sale price in Florida peaked in May 2022 at $410,900; as of September 2022, the median sale price is down to $392,500.
Is Florida a buyers or sellers market? ›
Florida metros in 'top 25' for a seller's market
On average, the median home price in these markets is expected to increase 8.3%, compared to the less than 1% increase forecast for the U.S. as a whole.
There's even a surprising amount of coastline that is undeveloped, he said. In South Florida, where there is a scarcity of land, prices are higher. But the abundance of land in the rest of the state results in lower prices for both land and homes.
What's most overpriced housing market in Florida? ›
According to the initiative, home prices in Cape Coral are overvalued by 47.22%, while Lakeland, Palm Bay, Deltona and Tampa have home prices overvalued by around 41%. Data shows that renters are also paying more than the average in Florida — with Cape Coral once again being one of the most overvalued places.
What state has most expensive houses? ›
1. Hawaii. Hawaii is known for its beautiful beaches, warm climate, and breathtaking scenery. However, it is also the most expensive state to buy a house, with a Zillow Home Value Index of $834,582.
What is the most overvalued housing market? ›
1. Atlanta
- Average listing price: $357,677.
- Expected home value: $236,627.
- Difference between home value and list price: 51.16%
A reason Florida housing prices have gone up is that the demand is outpacing the supply of homes. For example, from 2010 to 2016 Florida saw the addition of almost 114,744 new households per year. However, only 57,952 new housing units were constructed.
Where does Florida rank in cost of living? ›
Overall, the cost of living in Florida ranks as the 24th highest among states. It is important to note that this index reflects the annual average cost of living in 2021 and does not account for recent price increases due to inflation.
Why is it cheaper to buy a house in Florida? ›
Large Supply of Properties
Generally, there is typically a large supply of properties available in the housing market. This makes the houses less expensive, as there are more to choose from, and makes finding a Florida investment property easier.
Is Florida the most expensive state to live in? ›
The ten most expensive states to live in are Hawaii, Massachusetts, California, New York, Alaska, Maryland, Oregon, Connecticut, New Hampshire, and Vermont. Hawaii is the most expensive state to live in, with a cost of living index of 184.
Which state is more expensive to live in California or Florida? ›
Buying a House in Florida
Housing prices are much cheaper in Florida than they are in California. In fact, homes in the Los Angeles area of California cost up to 180% more than homes in Orlando, Florida.
Will real estate prices go down in South Florida? ›
“It's what we're living with.” While prices may slightly drop year-over-year at some point in 2023, Beracha predicted they won't fall by much. He said South Florida needs between five to 10 years' worth of new housing construction at the pace homes are being built here today.
“We expect that 30-year mortgage rates will end 2023 at 5.2%,” the organization noted in its forecast commentary. It since has walked back its forecast slightly but still sees rates dipping below 6%, to 5.6%, by the end of the year.
How long will rates stay high? ›
Economists have long expected the Fed would likely stop raising interest rates at some point in 2023, but “where” rates peak — a level known as the “terminal” rate — is actually more important than “when.”
How long until interest rates go back down? ›
"Possibly in 2024, but it will depend on the Fed's decisions about raising rates in the second half of the year," says Fleming. "And even if they do go down, it won't be back to the rates of yesteryear. 6% mortgage rates used to be normal, and that's more reasonable to expect too."
Why buying real estate in 2023 could be a good investment? ›
Despite what some may think, 2023 is still a good year to invest in real estate, thanks to advantages like long-term appreciation, steady rental income, and the opportunity to hedge against inflation. Mortgage rates are expected to decline, but the housing market is likely to remain competitive due to low supply.
Is it better to have cash or property in a recession? ›
In addition, during recessions, people with access to cash are in a better position to take advantage of investment opportunities that can significantly improve their finances long-term.
How long did it take for house prices to recover after 2008? ›
Delving Into 2008's Recession
Home prices fully recovered by late 2012. If someone bought a house at the very peak of the recession in 2007 and held the property for 5 years, they made money in appreciation after 2012. It took 3.5 years for the recovery to begin after the recession began.
What time of year is best to sell a house in Florida? ›
December typically outpaces all other months as Florida's best-selling month. Listing in November means a home will spend the fewest days on the market (DOM) before selling. While the national average for days on the market is 55 days, Florida homes for sale in November tend to list for 51 days.
Is it worth buying property in Florida? ›
In fact, the Florida real estate market is one of the most profitable investment markets to date. There are many factors to suggest that purchasing Florida investment properties is a rewarding experience. For example, the state offers people with a lucrative return on investment on their properties.
Why buy a house in Florida? ›
Florida is one of the nine US states that do not have any income tax. It can save you a lot of money, especially if you fall in a high-income tax bracket back in your state. Not just this, Florida's constitution prohibits the state from imposing any individual income tax, which means it's a safe bet.
Will Florida real estate prices go down in 2023? ›
Overall, the Florida housing market is likely to remain strong in 2023, with continued demand for homes and steady price growth. However, the market may begin to stabilize as the growth rate slows down, which may lead to more balanced conditions between buyers and sellers.
Are home prices in Florida dropping or rising? Over the past few years, home prices in Florida have skyrocketed. Per Redfin data, in the middle of 2020, the median sale price was $275,600 — by April 2023, that figure had jumped to $400,800.
What to expect next from the housing market? ›
Mortgage Bankers Association: The trade group's latest forecast has U.S. home prices, as measured by the FHFA US House Price Index, falling 0.6% in 2023 and another 1.4% dip in 2024. It then expects national home prices to rise 2.1% in 2025. (Forecast updated on April 17, 2023).
What is the mortgage rate forecast for the next 5 years? ›
Predictions for home prices
Overall, in five years, he expects prices to have appreciated a total of 15–25 percent. McBride predicts home prices will average low- to mid-single-digit annual appreciation over the next five years.
How high will interest rates go by the end of 2023? ›
The Mortgage Bankers Association predicts rates will fall to 5.5 percent by the end of 2023 as the economy weakens. The group revised its forecast upward a bit — it previously expected rates to fall to 5.3 percent.
What will mortgage interest rates be in 2023 2024? ›
Fannie Mae expects the 30-year fixed to ease to around 6.1% in the second quarter of 2023, before falling to 5.9% in the third quarter and 5.7% in Q4. And it gets even better than that. By the end of 2024, they expect the 30-year fixed to average 5.2%.
Will my house be worth more in 5 years? ›
How much will property prices rise in 5 years? Based on historical averages of 3.5% of home value growth per year, property prices will rise a total of about 18 to 20% in 5 years. The math is simple: 3.5% a year for 5 years, compounding annually.
How much will my house be worth in 2030? ›
The state where house prices are predicted to be the highest by 2030 is California, where the average home could top $1 million if prices continue to grow at their current rate. Other states expected to see their average house price rise above the $750k mark include Hawaii, Washington and Colorado.
What year is best to buy a house? ›
Winter is usually the cheapest time of year to purchase a home. Sellers are often motivated, which automatically translates into an advantage to you. Most people suspend their listings from around Thanksgiving to the New Year because they assume buyers are scarce.
What is the real estate forecast for Miami in 2023? ›
Miami Real Estate Market: Predictions
The U.S. News Housing Market Index predicts that the first five months of 2023 will see just under 3,265 single-family homes and just over 5,545 multifamily housing units approved for production.
Are home prices dropping in Tampa? ›
Median Home Price in Tampa
It's also below the nation's median of $387,000. “I do not expect prices to drop any time soon,” Korneva says.
Tampa is a Sellers Housing Market, which means prices tend to be higher and homes sell faster.
How much does it cost to build a house in Florida? ›
The cost of house building in Florida ranges between $240,000 – $350,000, with the state average at $295,000. This figure does not include land costs, excavations, permits, and other expenses. Home building prices in Florida can reach millions depending on the build type and customizations.
Is Miami in a housing bubble? ›
MIAMI - Skyrocketing housing prices are touching just about all of us in one way or another. Now even higher earners are giving the housing market here a second look and deciding to rent instead. While prices appear to have peaked last summer, they still ended 2022 higher than they were at the end of 2021.
What are the real estate challenges in 2023? ›
Top 10 Issues Affecting Real Estate 2022-2023
- Inflation and Interest Rates.
- Geopolitical Risk.
- Hybrid Work.
- Supply Chain Disruption.
- Energy.
- Labor Shortage Strain.
- The Great Housing Imbalance.
- Regulatory Uncertainty.
In 2023, experts forecast that the Florida home prices may fall down to 20%. Mortgage Rates Have Almost Doubled: Mortgage rates almost doubled from April 2021's 3.12% to 6.27% for the week ending on April 13, 2023. Sellers are Coming Back, but Slowly: The number of listings dropped by 14.9% in March 2023.
Are Tampa homes overpriced? ›
In 2022, local news was abuzz with reports that Tampa had one of the country's most overpriced real estate markets. In fact, Tampa is considered the 9th most overpriced city in the country when it comes to housing, according to Florida Atlantic University's Beracha and Johnson Housing Index.
Why are Florida home prices so high? ›
Florida is one of the most expensive states for housing, and Miami is the least affordable city in the country, according to a report. High demand, short supply, increased migration trends since the pandemic and exploding mortgage rates, make for a pricey combination.
What is a good salary in Tampa FL? ›
Average Salary in Tampa, FL
| Annual Salary | Monthly Pay |
|---|
| Top Earners | $85,980 | $7,165 |
| 75th Percentile | $76,846 | $6,403 |
| Average | $60,018 | $5,001 |
| 25th Percentile | $43,191 | $3,599 |
Hot Tampa Bay real estate trends
In 2022, Tampa Bay ranked in the country's top 5 places to live. The area is experiencing more people relocating to the area than it has in decades. As a result, the Tampa Bay housing market continues to experience high demand. The area remains one of the more affordable places to live.
What is the future of real estate Tampa? ›
State of play: Zillow predicts home prices will increase in the Tampa area in 2023. Other markets that saw huge increases during the pandemic are now slowing down, but not us. The typical home value in the Tampa area is still up nearly 18% year over year, compared to 11% across the country.
Overall, the average cost of homes for sale in Florida is $406,988, with an average price per square foot of around $207. Therefore, it's currently more expensive on average to buy an existing home in Florida than it is to build a house.
Is it better to build or buy a house in Florida? ›
Typically it's the more expensive option, but due to recent market changes, is it now cheaper to build a house? In Florida, the answer is an easy yes, as the state ranked among the top 10 where it is cheaper to build than buy an existing home, according to a new study from StorageCafe.
How much does a 4 bedroom house cost to build in Florida? ›
The average price to build a house in Florida with four bedrooms is between $388,000 and $465,000. This range is higher than the average Florida construction costs due the fact that four-bedroom houses are typically newer than those with three or fewer bedrooms.
