These Are the 10 Most Overpriced Housing Markets in the U.S. — 5 Are in Florida (2024)

FAQs

Which housing markets are the most overpriced? ›

The most overvalued markets to rent a home are mostly found in California and Florida. You'll pay the most to buy a median-price home versus renting a home in California, as well as MSAs in Oregon, Washington, Colorado, Idaho and Utah.

According to data from Florida Atlantic University, Atlanta has the most overpriced housing market in the United States. The capital of the Peach State beats out multiple Florida cities, Charlotte, North Carolina, and Memphis, Tennessee to take the top spot for 2023.

Florida's housing market mirrors larger national trends, albeit with some regional variation. An imbalance between demand and supply has fueled rapid home appreciation across the state. The real estate appreciation rate in the Sunshine State in the last two years (Between 2020 Q3 – 2022 Q3) has been 53.28 percent.

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.

Buyers Have More of an Upper Hand: Florida was the hottest market post-pandemic, but it has significantly slowed down. In 2023, experts forecast that the Florida home prices may fall down to 20%.

Average Housing Costs in Florida: $1,137 to $1,981 per month

No matter where you live, one of your largest ongoing expenses will be paying for housing. Florida has nearly 10 million housing units, according to the 2021 census, so there's an array of housing options throughout the state.

According to the 2023 International Housing Affordability Survey by Demographia, three out of the 10 least affordable housing markets are in Australia and New Zealand, two are in Canada and four more are located in the United States. The least affordable housing market is Hong Kong.

Hawaii is the most expensive state to live in, according to the Bureau of Labor Statistics' "2021 Consumer Expenditures Survey," the most recent data provided by the organization.

What does overvalued housing market mean? ›

House prices that exceed their fundamental value by more than 20% are considered extremely overvalued.

There simply aren't enough houses on the market to meet the demand that's out there right now. According to the National Association of Realtors, the supply for homes in the US that are for sale reached a record low in 2022.

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.

Florida built hundreds of thousands of new rental units between 2012 and 2021, but lost nearly 277,000 units with monthly rents below $1,000, according to the University of 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.

In April 2023, 14.8% of homes in Florida sold below list price, down 28.8 points year. There were only 26.5% of homes that had price drops, up from 15.0% of homes in April last year. There was a 97.3% sale-to-list price, down 3.3 points year over year. …

Maybe, maybe not. But the market forces of rising interest rates, from 3.8% to 5.34%, to 5.97%, to 7.81% finally hampered the buying power of homebuyers, slowing home sales. In Lee County from 2021 to 2022, single-family home sales dropped by 19.5%. Collier sales fell by 31% and Charlotte by 9.3%.

Additionally, Florida's foreclosure rate is a reported one in every 3,964 homes. SoFi said the number of foreclosures in the country had “drastically increased” through 2022 and that “with a total of 248,170 initiated, U.S. foreclosures rose a staggering 169 percent from the previous year.”

The year 2024 is expected to bring more stability to the housing market after a few years of uncertainty. With mortgage rates declining faster than expected, home prices are likely to remain mostly flat throughout 2024.

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.

Is it a good time to buy house in Florida? ›

As of Q4 2022, the number of closed sales for single-family homes decreased by 33.1% from the previous year and the number of new listings was down 17.1% from the year before, according to Florida Realtors. That doesn't mean it's a bad time to buy, though.

Jacksonville is the most affordable city in Florida and coincidentally, it also has the youngest population in the state. There are activities and features galore here including 22 miles of beaches, historic neighborhoods, world-class fishing, museums, parks, and a thriving restaurant and craft beer scene.

Cape Coral

Cape Coral has cheaper housing costs, utility bills, and healthcare costs than the national average. With an average home price of just over $4,30,000, this city on the Gulf Coast is a great option for those looking for affordable living in Florida.

According to several studies on cost of living, Hawaii is the most expensive U.S. state to live in. Prices are typically double in Hawaii compared to those on the mainland, and the continued rise in inflation is making costs ranging from housing to health care much more expensive.

Hawaii is the most expensive state to live in, with a cost of living index of 184.

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.

1. Hawaii. Hawaii is truly a paradise, but it is also the most expensive state in America to live in. The cost of living in Hawaii overall is 86% higher than the national average, and the cost of housing in Hawaii is a jaw-dropping 207% above the national average.

Where is the world's most expensive place to live? ›

Singapore and New York City tied for the first rank amongst the world's most expensive cities in 2022, pushing Israel's Tel Aviv from the first place in 2021 to the third place in 2022.

57th Street (world's most expensive street according to Business Insider) Central Park South (world's third most expensive street) Park Avenue (world's fourth most expensive street)

The Bay Area has the worst performing housing market in the nation, according to a new report.

Is Orlando real estate overpriced? Florida real estate can certainly be expensive, and a study conducted by Florida Atlantic University showed that Orlando is in the top 20 of overpriced U.S. home markets. However, it's important to look in the future to think about home values, too.

Based on the latest S&P 500 monthly data, the market is overvalued somewhere in the range of 65% to 117%, depending on the indicator, up from last month's 60% to 110%.

Strained affordability has seen many homebuilders turn to smaller units. The Pandemic Housing Boom, which pushed national home prices up over 40%, coupled with last year's mortgage rate shock, has resulted in a deterioration of housing affordability.

Because of the many tax benefits, real estate investors often end up paying less taxes overall even as they are bringing in more income. This is why many millionaires invest in real estate. Not only does it make you money, but it allows you to keep a lot more of the money you make.

It's normally cheaper to buy an existing house, mainly because construction is expensive, especially since labor and material costs have increased with inflation.

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.

Will home prices go down in South Florida? ›

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. And higher interest rates since early last year have slowed home building.

Low income describes a family at or below 80% of area median income. Moderate income describes a family at or be- low 120% of area median income (at or below 100% of median income for federal programs).

Renters. Floridahousingsearch.org is a free, online affordable housing locator service that makes it easier to find affordable rental housing around the State. This locator is part of Florida Housing's ongoing effort to respond to housing needs in general and specifically during natural disasters.

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.

From July 2021-July 2022, nearly 444,500 people moved to Florida, which compared to the previous year was a gain of 185,000, the largest year-over-year impact of residents moving. Florida also ranked #1 in domestic migration, #2 in international migration, and #1 with the most people moving in per day at 1,218.

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.

All the cities on this graphic are classified as severely unaffordable⁠—and, for the 12th year in a row, Hong Kong takes the top spot as the world's most unaffordable housing market, with a score of 23.2.

According to worldpopulationreview.com, Hawaii is the most expensive state to live in, with its housing costing three times the national average. New York and California rank as the second and third most expensive states in which to live, respectively.

Why is housing becoming unaffordable? ›

The imbalance between supply and demand; resulted from of strong economic growth creating hundreds of thousands of new jobs (which increases demand for housing) and the insufficient construction of new housing units to provide enough supply to meet the demand.

Sydney ranked behind Hong Kong which took the place as the least affordable city in the world, with Vancouver in third place.

Monaco is the most expensive country to live in, with a cost of living of $3,585 per month. Other expensive countries to live in include the Cayman Islands, Switzerland, and Singapore, all of which have a cost of living of over $2,000 per month.

Hong Kong is the least affordable market, with a median multiple of 18.8. Sydney was the second least affordable at 13.3, Vancouver at 12.0, Honolulu at 11.8, San Jose at 11.5, Los Angeles 11.3, Auckland 10.7, Melbourne at 9.9, Toronto at 9.5 and San Diego at 9.4.

Texas replaced California in 2023 as the strongest housing market by state. With an existing home inventory of 83,222, the available houses for sale have more than doubled since last year. It has seen a drop of about 6% in new construction and is now at 248,648 since 2022.

The state's now home to the least affordable places to live in the U.S., according to multiple studies covering rental costs, home prices and income. Rent.com reported Tampa's average rent for a one-bedroom apartment was $1,682, up 32.4% since the year before. In St. Petersburg, it's $1,890 or 19.6% higher than 2021.

No state income tax in Florida, cheaper real estate and the weather are the top reasons broker Melissa Cantway said people are still moving here.

Is it expensive to live in Florida? Though the state has long had a reputation for being an inexpensive place to live, housing costs are high. Rents and sale prices are both well above national averages. However, the overall cost of living in the state is about on par with the national average.