Florida Real Estate Market

Photo of author

(Newswire.net — May 4, 2022) — Across the country, the real estate market is hot. Interest rates are low, improving buyers’ purchasing power. Millennials are entering the housing market because they’ve been able to save up enough for a down payment. But in many places, supply can’t keep up with demand, contributing to the hot market. Homeowners are reluctant to sell, so there aren’t enough homes even though buyers are ready to buy. The pandemic didn’t help. The pandemic created supply chain issues for building new homes, but construction slowed down from lockdowns in many parts of the country. These problems have created opportunities and issues in Florida. 

People Keep Moving to Florida, Nobody is Leaving 

According to U-Haul, Florida, and Texas account for 60% of the top 25 cities for growth. Florida has a great climate and offers residents various employment opportunities. Tourists come for Florida’s sunshine, theme parks, and beautiful beaches. Compared to similar markets, homes are more affordable in Florida. There is a diverse job market, especially in hospitality. But one of the biggest draws is the reduced taxes. It’s no longer just seniors who want to experience Florida. Millennials are making their way to Miami for the beach culture, Tampa for business opportunities, and Orlando for jobs and entertainment. U-Haul also states that there are more incoming movers to Florida than those leaving. It’s safe to say that Florida is a popular state.

New Construction Homes are Needed to Meet Demand

New home construction is the most effective way to increase supply. Vaster, a private real estate lender, predicts that new construction homes will gain in popularity for many reasons. The 2008 financial crisis led many contractors to underbuild new homes, leading to today’s housing crisis. The low inventory of homes in the current market makes it harder for the industry to find equilibrium. Vaster estimates the housing market is short by over 4 million units. 

What Markets in Florida Are Booming?

Florida is a diverse state with many different regions. It’s hard to compare each market; Miami’s market is different from the markets in Orlando and Pensacola. In Southern Florida, real estate tends to be expensive. Let’s look at other Florida locations to learn where the hottest opportunities for new home construction lie.

Southern Florida

The Herald-Tribune reports that the Miami-Dade area is home to some of the most costly real estate in the country, not only in Florida. At least two zip codes have more affordable real estate in the area. Fort Lauderdale, zip code 33313, has homes selling for under $100,0000 in September 2021. West Palm Beach, zip code 33417, also had affordable homes, but this community struggles financially. Overall, Miami had one of the most significant price increases in housing in 2021 at 27.3%. Vaster estimates that homes in Southern Florida may be overpriced by as much as 11%.

Central Florida

Orlando is Florida’s 5th-most populous city. The big problem with the housing market in Orlando is that supply is low. It’s currently a seller’s market. Homes sell for the listing price or up to 3% above and get pended in under two weeks. Norada, Real Estate Investments reports that South Semoran homes have a median price of $147,100, the most affordable neighborhood. The housing market continues to see value growth. New construction homes could help meet demand in time. 

West Florida

The Herald-Tribune reports that Tampa had the most considerable increase in housing prices in 2021 at 29.4%. According to Redfin, the median home price is $375,000, and by all reports, Tampa appears to be one of the biggest markets for growth in 2022 and beyond. Unfortunately, investors are buying homes on the market, pushing many potential home buyers into rentals rather than homeownership. The area is expected to explode, with a 3.3% population growth expected annually for the next few years. The job market is booming in multiple industries, tech, travel, transportation, healthcare, education, and professional services. The real estate market is diverse, with 93 different neighborhoods ranging in home prices from $190,000 (Sulphur Springs) to $2.6 million (Davis Islands).

Northeast Florida

Jacksonville, or Jax, is the largest city in the area. The population is growing, but it’s still one of Florida’s more affordable communities. Forbes ranked Jax #22 as one of the best places for jobs and businesses in the United States. The median home value for sold homes is $275,000. Homes in the Mandarin neighborhood have a median value of $472,500, the most expensive community. Jacksonville Heights is a more affordable neighborhood with homes around $185,000. The population in this area may more than double over the next 25 years.

The Florida Panhandle

Realtor.com reports that the median listing price for homes in Tallahassee was $249.9K, but homes in the 50 communities for sale range from $5K to $2.4M. Tallahassee is a buyer’s market as of March 2022. The supply of homes in the capital is greater than the demand. Even so, home values are still increasing in this area. Condos are popular in the area, too. As you go farther west in the Panhandle, the beach is a popular place to buy a home, and prices increase along the coast.

Real estate is a good investment, even in a seller’s market when land is at a premium. Building new homes can help stabilize a local housing market and help it reach equilibrium. These brand new homes may be your only option in some areas; it’s not bad. Most buyers prefer a new home but buy resale based on location.