Florida's Real Estate Shake-Up — Tripling Inventory And Significant Price Reductions. Time To Buy Or Go Elsewhere?

According to the CEO and founder of real estate analytics firm Reventure Consulting, the Florida housing market is undergoing some big changes, resulting in housing inventory tripling in some places. 

This housing market downturn in Florida is getting crazy.

There's ZIP codes where inventory has nearly tripled from its level last year.

Like this one north of Tampa, in Port Richey. 248% growth in listings YoY.

That's the sign of a major selloff. And indicates prices are… pic.twitter.com/sYQl77RVY4

— Nick Gerli (@nickgerli1) June 18, 2024

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What’s Happening in Florida?

According to Redfin, rents in Florida’s major cities are down significantly year-on-year, and the state is experiencing a surge in the number of homes for sale. This has led to sellers cutting prices aggressively. Along the Gulf Coast, for instance, the number of homes for sale has jumped by up to 50% compared to last year.

In the North Port-Sarasota area, there’s been a 48% increase in available homes, and even high-end spots like West Palm Beach have seen a 20% rise in inventory.

In recent years, fewer people have also been moving to Florida. In 2022, the Florida Chamber of Commerce noted 750,000 new residents versus 500,000 people leaving, giving a net gain of 250,000. However, for 2024, they’re expecting only between 225,000 and 275,000 new residents.

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Weakest Markets In Florida

As we wrote in May, according to Lance Lambert of ResiClub Analytics, the 10 weakest housing markets in the U.S. are all located in Florida. One place that had depreciated by 0.05% is Punta Gorda. Places like Panama City, North Port, Cape Coral, and Naples had the weakest month-over-month appreciation, ranging from 0.04% to 0.51% in Deltona, Florida.

Where To Move Or Invest Instead

Given the cooling market in Florida, you might want to consider other cities for your next home or investment. According to the same analyst, 10 housing markets that saw the strongest month-over-month appreciation include:

1. San Jose, CA 
2. Rochester, NY 
3. San Francisco, CA 
4. Scranton, PA 
5. Green Bay, WI
6. Syracuse, NY 
7. Youngstown, OH 
8. Champaign, IL 
9. Saginaw, MI 
10. Rockford, IL

San Jose and San Francisco have seen strong month-over-month appreciation, with homes appreciating by 2.94% and 2.41%, respectively. The rest range from 2.13% to 2.48%. 

Apart from appreciating home prices, some cities have recently made the news for good things happening. For instance, Houston has a strong job market with many Fortune 1000 companies. Despite the city’s size, real estate prices are relatively affordable, making it a great investment choice. It’s also 13th among the most affordable places to raise a child, notably below the national average of $25,181 per year to raise a child in a large U.S. metro.

Raleigh, North Carolina is growing fast. With a strong job market and significant tech and university presence, it’s an excellent place to invest in residential and commercial real estate. 

Columbus, Ohio, offers a robust rental market thanks to its large student population and major infrastructure investments. The city has also seen significant neighborhood revitalizations.​

Affordable Options In Florida

Still, if you’re dead set on Florida as your next home or you see the investing potential in the Sunshine State, the cooling housing market in Florida presents new opportunities, such as two Fort Lauderdale suburbs topping the list of places you’re most likely to find a house priced below $200,000.

"Areas that were once popular for downsizing are now out of reach for many," senior economic analyst Hannah Jones for Realtor.com said. Still, "Florida markets like Lauderdale Lakes are seeing a surge in affordable condos, providing viable options for those looking to downsize without breaking the bank."

In fact, in Lauderdale Lakes, 17 out of every 20 homes are listed for under $200,000, with a median price of $149,000, and Lauderhill follows with a median home price of $175,000. These towns are popular retirement destinations and offer more affordable living compared to other parts of Florida.

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