Florida is facing notable risks in its housing markets. According to a recent report by Parcl Labs, 13 out of the 15 housing markets labeled as “at risk” are located in Florida. Here are some key points:
- Reasons for Risk:
- Hurricane Ian: The impact of Hurricane Ian in September 2022 has contributed to additional softening in Southwest Florida.
- Spiked Home Insurance Premiums: Rising home insurance premiums have further strained affordability in the state.
- Changes Following Surfside Condo Collapse: Legislation passed after the Surfside condo collapse in 2021 has put downward pressure on older condos along the Florida coastline.
- Specific Cities at Risk:
- Some of the cities with high risk include Crestview-Fort Walton Beach-Destin, Deltona-Daytona Beach-Ormond Beach, Miami-Fort Lauderdale-Pompano Beach, and Tampa-St. Petersburg-Clearwater.
- Palm Bay-Melbourne-Titusville and Deltona-Daytona Beach-Ormond Beach are particularly vulnerable, with a more than 70% chance of home value declines in the next year.
- Market Analysis:
- Parcl Labs analyzed data for the 1,000 largest U.S. housing markets using their API.
- They considered markets where demand (home sales) declined by more than 10% on a rolling 3-month average and supply (active inventory) increased by more than 20%.
Florida homeowners are struggling with massive spikes in insurance cost. Especially in a housing market like Miami. The average cost of property insurance in Florida is now over $11,000/year. Which is causing many homeowners to be forced to sell their properties. As a result – homes for sale on the Florida housing market is rising fast in 2024, particularly in metros like Miami, Tampa, and Orlando. Another issue plaguing Florida is overbuilding. Apartment developers went crazy permitting new luxury apartments during the pandemic, and now there is a big spike in vacant deliveries into Miami’s apartment market. Many of the luxury apartments are sitting empty and some are cutting rent.