A growing number of unsold homes are piling up in the Florida market as buyers in the state remain "on strike," leading sellers to lose "patience" and reduce their asking price, according to Wolf Richter, CEO of Wolf Street Corp. and editor-in-chief and founder of WolfStreet.com.
Active listings in the Sunshine State jumped by 5.9 percent in March from a month earlier and by 34 percent year-over-year to 177,006 homes, according to Realtor.com data. Not only has inventory gone back to pre-pandemic level, but that's the highest share of active listings tracked by the company since 2016.
Why It Matters
The Florida housing market boomed during the pandemic, when the rise of remote work allowed many Americans to relocate to the state, attracted by its sunny weather, relatively affordable housing and lower taxes. The influx of out-of-state newcomers brought up demand in the state, increasing competition for the limited amount of housing available in the market.
Florida has since then been building more homes than almost any other state in the country, with the exception of Texas, but demand has slowed down, partially due to the decline of remote work, and partially because rising prices and high mortgage rates have pushed many buyers to the sidelines of the market.
What To Know
While active listings are on the rise all across the state, some cities are seeing particularly high increases.
In the Tampa metro, which comprises Tampa, St. Petersburg, and Clearwater, active listings jumped by 5.8 percent in March month-over-month to 18,003 homes, after rising 6.8 percent in February from a month earlier. Compared to a year earlier, active listings were up 29 percent.
In the Miami metro, which includes Miami, Fort Lauderdale, and West Palm Beach, active listings jumped by 4.4 percent in March from February to 50,841 homes. In the Orlando metro area, which covers Orlando, Kissimmee, and Sanford, active listings climbed by 3.9 percent in March from February to 13,287 homes.
According to Richter, sellers in Florida "are beginning to lose their patience, even as buyers were still on strike," and are now increasingly slashing prices to meet buyers where they are at.
While recent declines in mortgage rates are giving buyers more purchasing power, homebuying remains a pipe dream for many Americans crushed by years of climbing prices and rising housing costs, including homeowner association (HOA) fees and property insurance. This has been made clear by recent data showing a drop in pending home sales in the Sunshine State.
Two of the top five metro areas with the highest home sale cancellation rates in January were in Florida, according to a Redfin report. These included Orlando (18.2 percent) and Jacksonville (17.8 percent).
While buyers are getting cold feet, sellers are coming to terms with the reality of the current housing market, and lowering their initial asking prices.
The median listing price of a home in Florida on a per-square foot basis has fallen by 11 percent from the high in May 2023, to $367 per square foot in March, according to Realtor.com data mentioned by Richter. The median listing price of a home per se has fallen by 17 percent from the high in June 2022.
"It shows how sellers are grappling with reality," Richter wrote.
In Miami, the median listing price of a home was $650,000 in February, according to Realtor.com data, down 3.7 percent year-over-year. In St. Petersburg, it was $727,500, down 3 percent year-over-year; in Orlando, it was $370,000, down 4.6 percent year-over-year.
In Tampa, the median listing price was trending up 3 percent year-over-year, at $463,700. The median price of homes sold in the city, however, was notably lower at $423,800.
What People Are Saying
Nick Gerli, CEO of real estate platform Reventure App, previously told Newsweek: "New listings continue to rise due surging insurance and HOA fees. Meanwhile, demand is down due to a slowdown in people moving to the state. Prices are dropping in most counties. Reventure App anticipates an -5.0 percent YoY drop statewide in 2025."
Robert Washington, a broker at Savvy Buyers Realty based in St. Petersburg, Florida, previously told Newsweek: "I believe the Tampa market is already in the midst of a correction that started around four months ago. Many attributed the slow down to the hurricanes that hit, but I think there was already weakness brewing in our market. I absolutely think the stigma from the hurricanes contributed to the softness, but I think that high interest rates have been the true culprit... We have started to see an uptick in buyer activity over the last few weeks which is promising, hopefully that will turn into sustained momentum."
What's Next
The Florida housing market is experiencing what experts call a price "correction" after years of overheating. While many experts expect prices to slide down in many cities in the Sunshine State throughout 2025, buying a home in Florida is still much more expensive than it used to be before the pandemic.
