Home sales are falling in Florida. In fact, all five of the U.S. metro areas where pending sales are sliding fastest are located in the Sunshine State, according to real estate brokerage firm Redfin.
The good news for Florida home sellers is that the rate of declines has recently started to subside a bit.
Still, the decline has been significant. Here is the rate of year-over-year decline in five key cities for the four weeks ending Nov. 10, 2024:
- Fort Lauderdale: -15.2%
- Miami: -14%
- West Palm Beach: -13.8%
- Jacksonville: -9.5%
- Tampa: -7.2%
By contrast, pending sales nationwide rose 4.7% over the same timeframe.
So, what is driving the decline in Florida sales? Here are the major factors.
Surging home insurance costs
As we reported earlier this year, nearly three-quarters of homeowners in Florida say the rising cost of homeowners insurance is impacting them or others in their community.
The cost of insurance is soaring in Florida due to a spate of destructive hurricanes and a growing problem with insurance fraud and excessive litigation.
The result is that by May 2023, home insurance costs in the state had shot higher by 35% compared with the year prior.
Surging condo fees
Condo fees also have ballooned in recent years in Florida and are up by more than 15% year over year in several cities.
Several factors are driving the price increase, including stricter condo regulations, higher insurance costs and the wave of inflation that has swept the country in recent years.
We delve into the problem in greater detail in “Why Condo HOA Fees Are Suddenly Surging in Florida.”
Lindsay Garcia, a Redfin Premier real estate agent in Fort Lauderdale, says some condos are now sitting on the market for more than a year before they sell.
Recent natural disasters
A recent wave of destructive hurricanes is likely the most publicized factor that might be causing folks to reconsider buying a home in Florida.
In September, Hurricane Helene crashed into Florida and left a path of destruction in its wake. A couple of weeks later, Hurricane Milton took aim at central Florida.
In 2022, Hurricane Ian devastated parts of Florida’s west coast.
Such weather events are expected to drive the cost of home insurance even higher, which makes the Sunshine State a less affordable and attractive option for some people.
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