The Florida real estate market has been a hot topic of conversation for some time now, with demand soaring during the past few years. As we enter mid-May of 2023, however, the market is showing signs of a healthy rebalancing, primarily due to higher interest rates and the increased cost of borrowing.
In this blog post, we will delve into the Florida real estate market outlook for 2023, including the latest trends, home prices, and relocation advice. We'll also shed some light on expert insights from the realm of real estate.
Demand and the New Economy
The COVID-19 pandemic brought with it a new work-from-home economy. This, coupled with increased demand from corporate investors and a large influx of people relocating to the Sunshine State, led to a surge in the demand for Florida real estate. The scale of this influx was much larger than the regular seasonal migration known as "snowbird" activity.
The Current State of Home Prices in Florida Real Estate
By the end of March 2023, the median single-family home price in Florida stood at $405,000, marking a 2% year-over-year gain. For a detailed breakdown of median home prices in each of Florida's city regions, consider visiting our page on the cost of living in Florida. This page also provides a comparative overview of living costs between Florida and other states.
The population boom Florida has seen in recent years has resulted in a significant rise in housing prices in a relatively short period. This heightened demand has kept the available housing inventory, or homes for sale, relatively low, with a supply of 2.7 months (a balanced market typically has a six-month supply). As a result, homes priced correctly continue to sell fairly quickly after hitting the market. For properties in desirable neighborhoods with good schools and preferred locations, multiple-offer situations are still occurring, albeit at a slower pace than during the market peak.
The Impact on New Home Construction
Florida's new home construction market has not escaped the effects of the strong demand. Lingering supply chain issues have extended wait times for new homes to 12+ months in some cases, compared to the usual 7 - 9 months from contract to close. Given that many relocating to Florida are keen to escape cold weather or to start their retirement years as Floridians, and are unwilling to wait this long, many are opting for recently-built homes in the resale market. In many cases, they are even willing to pay a premium above the asking price to secure a deal.
Despite the challenges, Florida remains a great location to invest and buy real estate. The state's attractive climate, strong economy, and relatively low cost of living continue to draw new residents and investors. Although the market may be rebalancing, it remains vibrant and offers plenty of opportunities for those willing to navigate its dynamics. As always, consulting with a local real estate professional can provide invaluable insights and guidance for both buyers and sellers navigating the Florida real estate market.
We are developing and investing in homes in some of Florida's hottest real estate market.
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