In 2008, when the housing market crashed, many in Florida wondered if and when a recovery would come. Fast forward to 2020, when the FHFA House Price Index (HPI) Quarterly Report for the first quarter had the Florida Housing Market ranked at number 12. In addition, the report showed average price growth over seven percent. The hottest Florida real estate markets at the time were Fort Lauderdale, Jacksonville, Orlando, the greater Tampa/St. Petersburg area, where home value appreciations in all four areas also topped the state.
With the COVID-19 outbreak and the restrictions that followed, Florida, like most of the nation felt the impact as the housing market took a hit amid the economic downturn. As states and localities reopened, the Florida housing market made a comeback in the third quarter boasting median property process just short of the $500,000 mark. On average, the price per square foot to purchase a home is between $275 and $300. The Coastal Home Team explains that while this by no means signals a complete turnaround, the Florida housing market is trending in a positive direction.
Florida Housing Market Forecasting – 2021
While no one in the industry has a crystal ball to 100 percent accurately forecast the housing market for the coming year, there are some indicators pointing to a positive outlook for Florida. Let’s explore some current trends in regard to 2021’s housing market.
The Population Continues to Grow
With a current population nearing 22,000,000, and a growth rate of nearly two percent, Florida’s population is on the rise. As the state’s population grows, so does the need for available properties, not only for sale, but also for rent. Where are the new residents coming from, you may ask? Florida’s population increases come from within the United States as well as outside it, with many immigrants arriving from Cuba, Latin America, and Spain.
The Demand for Real Estate Grows with Population Increases
As mentioned, there is a direct correlation between population growth and the demand for real estate. Following the advent of the coronavirus pandemic and the campaign to “flatten the curve” many home buyers and sellers paused their plans. By midsummer, the housing market began to recover as single family home sales increased nearly 12 percent over 2019. Why? Record low mortgage rates are certainly a factor in the trend. Interest rates are anticipated to remain low, meaning an increased demand which should continue into 2021.
Property Values are on the Rise
Florida, like many areas around the country experiencing a surge in the demand for property, are also experiencing low housing inventory levels, down nearly 27 percent over 2019 levels. The combination of growing demand and low inventory results in increasing property values, a trend which is likely to continue through 2021.
All Signs Point to a Continued Seller’s Market
The question is often asked, “Will the coming year be a seller’s market or a buyer’s market?” If trends continue, 2021 promises to be a seller’s market, in which sellers have the advantage in real estate negotiations.
A Booming Vacation Rental Market
Homeowners who rent their Florida properties saw a decline in vacation rentals as a result of the pandemic, but the industry is recovering nicely. As attractions reopened and localities once again allowed for private vacation rentals, bookings increased drastically. If the trend continues, the vacation rental market will continue to boom throughout 2021, making it a great time for property owners as well as those looking to invest in vacation rental properties.
The Coastal Home Team Can Help
Whether you are looking to call Florida home or want to make your mark with investment properties, The Coastal Home Team can help you through the process of buying or selling a home or property. Call The Coastal Home Team and experience the difference with unmatched expertise and trustworthy service whether you are buying or selling.