Recent data from real estate brokerage Redfin revealed that Florida’s housing market is cooling down, especially for condos.
Purchases by investors are on the decline compared to last year. The whole state is down by over 10%. The region that experienced the biggest drop was South Florida. Investor purchases in Fort Lauderdale dropped 24%, followed by Miami, at 19.4%, and West Palm Beach at 16%. Central Florida also took a hit, as purchases dropped 13.3%.
Another sign of a housing slowdown, houses are staying longer on the market compared to 2023.
Redfin attributed several factors making investors reluctant to make new investments in Florida. The new state law that has put safety measures for condo associations to follow will include demanding inspections and costs, which are passed on to the condo owner.
Redfin real estate agent Lindsay Garcia said the state’s new laws for condos, which include regulations that require annual inspections and repair fund reserves are hurting the market.
“The condo market is really struggling because of high HOA fees and homeowner’s insurance costs, and on top of that, many condo owners are seeing special assessments due to new rules implemented after the Surfside condo collapse,” Garcia said. “Some condos are sitting on the market for over a year.”
Another reason investors are taking a break from Florida purchases is hurricanes.
This year, the state was hit by Hurricane Debby, Helene and Milton. Analysts expect the insurance crisis the state has been dealing with to also continue into 2025.
Reuters reports between 2019 to 2023, the average premium for homeowners in the state has risen by 60%.
At the beginning of November of this year, Florida’s largest insurer, Citizens Property Insurance Corporation, insures over 1.3 million Florida homeowners. That number has also surged from 2019, when it only insured around 500,000.
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