Buying, Investing, Real Estate, Selling

4 Current Trends in Florida Real Estate

desiree-avila-realtor-short-sale-foreclosure

The Florida housing market continues to be one of the hottest in the country. While this might be great news for sellers, many buyers are having a difficult time finding a property especially with the ever increasing prices. Here are four of the current trends in Florida’s real estate market.

Increase in Sales

The most recent Florida housing statistics are available from April 2021. Single family homes sales in Florida have experienced a 55.4% year over year increase from April 2020, and condominium sales have experienced an astonishing 130.9% year over year increase. New pending sales across the state have also increased 60.7% year over year with a total of 32,803 new pending sales in April 2021. The sales increases are most prominent at the very top of the real estate market as sold properties listed for over million dollars have increased 302.1%. The South Florida market has been even hotter than the overall state. Sales in the South Florida market have increased 76.1% year over year. While these increase in sales have been great, due to a decrease in housing supply, these increases cannot continue for much longer.

Increase in Sales Prices

The increase in prices of Florida homes has been one of the most noticeable trends in the real estate market. Most experts would classify the current marketplace as a seller’s market since the decrease in housing inventory has given much of the negotiating power to the sellers. Many homes are been sold at or above list price, and there are countless examples of newly listed homes receiving 15 to 20 offers on the first day that the property is listed. The median sales price for Florida single family homes in April 2021 is $336,525.00, which is a 22.4% increase from last year’s median sales price of $275,000.00. The median sales price for Florida condominiums is $250,000.00, which is a 19.6% increase from last year. The large pricing jumps cannot continue indefinitely, but it has been difficult to predict when the sales prices will start to cool off.

Decrease in Housing Supply

This is the key factor causing housing prices to soar in Florida: lack of housing inventory. When there are a fewer number of houses on the market, then that lack of supply creates an increase in prices, which is exactly what has been happening in Florida. In April 2021, Florida only had a 1.1 months’ supply of houses, and historically a 6 month supply of houses is considered in the normal range. This means that there are considerably fewer houses on the market, and not near enough to satisfy the demand for housing. This is probably the most significant factor causing housing prices to increase. It is possible that this supply could start to increase as more builders construct new properties, and the eviction and foreclosure moratoriums expire; however, it could take until 2022 until we start to see a significant increase in housing supply.

Low Mortgage Interest Rates

One of the important factors that has a significant impact on demand for housing is the mortgage interest rate. Generally, as the mortgage interest rate decreases, which makes it cheaper to purchase a home, the demand for housing increases. Due to the global pandemic, the government has kept the interest rates low, and over the past 6 months, interest rates for mortgages have averaged between 2.8% and 3.0% for a 30 year fixed rate mortgage while the interest rate for a 15 year fixed rate mortgage has averaged around 2.3%. Historically, the current interest rates are some of the lowest in history. Over the past 30 years, interest rates have climbed above 10%, so the current interest rates of 3% are a major bargain.

These four trends in Florida’s real estate market will likely continue for the foreseeable future, and we might not see any substantial changes until the year 2022 or even 2023 as Florida continues to be one of the most popular destinations to relocate to in the country.

Be a part of Oakland Park online!

Join the Living In Oakland Park Facebook Group .
Sign up for the Living in Oakland Park Newsletter.
Follow Living in Oakland Park on Instagram.
Do you know of a great story in Oakland Park? Click here to submit it.

*LivingInOaklandPark.com is an independent publication, not affiliated with the City of Oakland Park.

About the Author

Joseph S. Giannell, Esq.

Board certified real estate attorney Joseph S. Giannell, Esq. is the CEO of the Florida title company, Giannell Title LLC, and the COO of the Florida real estate law firm of Peyton Bolin PL. With the experience of handling thousands of Florida real estate closings, Joseph’s practice is driven by a commitment to helping clients accomplish their goals with a problem-solving approach that strives to gets results no matter the real estate issue they’re facing. Joseph can assist anyone involved in Florida real estate transactions, from buyers and sellers to investors and lenders, with legal expertise on residential and commercial real estate, condominium and homeowner’s association law, and real property litigation.