How do you feel about the Florida Market?

Question

The market is shifting in Florida and more properties are staying longer on the market. Investors are starting to come back out and submitting lower offers that are being accepted. So where are we headed in 2023 for the Florida Marker??

Jeff Copeland · Answer

I've discussed this very question with lots of people from different segments of the industry.

Here's the situation in Florida:

1. Yes, rising interest rates are putting downward pressure on prices, but

2. Other factors (population growth + housing shortage = good old-fashioned supply and demand imbalance) are still putting upward pressure on prices, and

3. Comparing asking prices to sold prices is not particularly relevant. What we need to be comparing is year over year sold prices. 4. Based on simple economics, prices won't decrease on a macro level until supply exceeds demand, and that isn't happening anytime soon. This is borne out by the available market data below. Looking at the most recent market stats available (September 2022 compared to September 2021) for SFH, which are a good indicator of broader market conditions:

Properties sold for 96.5% of list price (down from 100% in 2021), and

Days to Contract increased from 9 days to 21 days, and

Days on Market increased from 49 days to 56 days, and

Inventory increased by 51%, and

Months of supply increased by 80% from 1.0 to 1.8, but

Average sale price still increased by 11.7% year over year.

So far, what we are seeing play out is not a crash, but a return to slightly more normal market conditions.

How do you feel about the Florida Market?

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