These sellers have to compete with inventory of new houses that in the South is now above Housing Bust highs.
By Wolf Richter for WOLF STREET.
Inventory is piling up in Florida. Active listings jumped by 5.9% in March from February, and by 34% year-over-year to 177,006 homes, the highest in the data from realtor.com going back to 2016.
The month-to-month surges in February (+7.3%) and March were particularly spectacular as sellers were beginning to lose their patience, even as buyers were still on strike.
In the Tampa metro (Tampa-St. Petersburg-Clearwater), active listings jumped by 5.8% in March, after having jumped by 6.8% in February, to 18,003 homes, the highest in the data from realtor.com going back to 2016, and up 29% year-over-year:
In the Miami metro (Miami-Fort Lauderdale-West Palm Beach), active listings jumped by 4.4% in March, after having jumped by 6.3% in February, to 50,841 homes, the fifth highest in the data, behind only the brief period from January through April 2019:
In the Orlando metro (Orlando-Kissimmee-Sanford), active listings rose by 3.9% in March, after the 5.2% jump in February, to 13,287 homes, by far the highest in the data from realtor.com going back to 2016, and up 46% year-over-year:
Sellers are climbing off their high-price horse and listing prices have been sagging, both per square foot, and per home.
On a per-square foot basis, the median listing price has fallen by 11% from the high in May 2023, to $367 per square foot. On a per-home basis, the median listing price has fallen by 17% from the high in June 2022. It shows how sellers are grappling with reality.
Listing prices are not sales prices. They reflect prices that sellers hope to get. I will post the sales prices of Miami and Tampa for March, among the 33 most splendid housing bubbles, when the data comes out later this month, but here are the selling prices through February, which have been declining for months for both metros).
New single-family houses for sale in the South, where Florida is by far the largest housing market, have ballooned past the Housing-Bust high since mid-2024 to a range between 290,000 to 304,000 houses for sale, with 296,000 new houses for sale in February, up by 72% from February 2019, according to Census Bureau data, which doesn’t provide state-level data, only regional data.
Those new houses are adding large amounts of additional supply to the surging inventories of existing homes. Homebuilders are the pros in this business, they know how to move the inventory: price cuts, building at lower price points, large-scale mortgage-rate buydowns, and incentives. And homeowners wishing to sell have to compete with this supply of new houses and increasingly aggressive builders.
Buyers are still on strike: In the South, pending sales of existing homes rose month-to-month in February, seasonally adjusted, but were down by 3.4% from the collapsed levels February last year, and booked the worst February in the data from the National Association of Realtors. Compared to 2019, pending sales plunged by 29%.
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No mention of black-listing of properties.
They’re not even a rounding error. There are 1,400 properties in Florida on the blacklist, out of about 10 million total housing units in Florida.
So in terms of prices, when can we see meaningful price drops? I live in the Tampa area and can say prices haven’t really moved down. You say they dropped 10% but the reality is prices are stagnant. We are seeing a lot more properties on the market however but that’s been the case for at least the last year with no meaningful price reductions.
I look at those prices per sq ft in the chart….they’re already super cheap!
(to a coastal Californian!)
The sellers who MUST sell will push those prices down until a buyer agrees with the price. This will push comps down, but it won’t happen overnight. Sellers and their agents will still be looking at recent sales from the past year and setting their hopes high. Those motivated sellers are the key to lowering comps.
Insurance costs will kill a bunch of sales as well.
If the market continues to decline, there may be even more inventory hitting the housing market in the future. I would suspect that those who bought up homes as investment properties at market peaks also own stocks. At some point, they’re going to need the cash.
Agree 100% here. I give it 6 months or less.
The Florida real estate boom is over. Florida was never a good investment in the first place. It has always been the subject of boom and bust cycles As a Meteorologist, with a MS in the subject and 12 years experience in tropical meteorology with the Navy and National Weather service I have a special interest in the subject. I wouldn’t touch any properties there anywhere near the coasts as they are one hurricane away from a total meltdown in condo and single family home resale value if they are even left standing. Construction codes were so sloppy after Andrew that an entire 50 mile stretch of South Florida ceased to have any habitable homes. Insurance companies are pulling out of South Florida. I talked to a homeowner there after Andrew who told me his insurance premiums were higher than his mortgage payments. Now they are 3x the mortgage payments.
Andrew was in 92. Update your references… way off!
Joe,
Nothing has changed since Andrew. Cost George H the election
Wrong SC:
In fact, HUGE changes in FL right after hurricane Andrew revealed both the lack of ”rigor” in the codes,,, and perhaps more importantly, the lack of proper enforcement of what codes were in effect.
The insurance industry conducted audits of every jurisdiction in the state, and then paid the politicians to update the codes AND to pass laws providing for severe penalties for lack of proper enforcement.
Saw the results personally as an estimator for storm damages in 2004, with houses built before enforcement of the 1994 codes leveled and next door ones built after OK except for a few roof shingles.
HUGE differences since then too, and more coming as the results of the more recent deadly condo collapse, with many dead, work through the system now.
Meteorologist, Swamp Creature = Starting to make sense now. 😉
Yeah, you have to be really dumb if you invest in Florida coastline in 2025. It’s doomed.
Almost just like 1926!
Another 1900 Galvenston is just one hurricane away.
There was no early warning system when Galveston was hit in 1900. and the place is thriving now, 124 years later!
SC, this is garbage. I’m a native 4th gen Floridian. Homes within a few miles of salt water rust because of salty air. Happens everywhere there is salt water… Pretty much world wide.
Rich people that live along the coasts of every state can afford to keep up with the extra maintenance. But the posuers who can’t, get into condos / houses that take their deferred maintenance and spend it on landscaping.
Then a storm comes along and makes a mess. Some worse than others. But there is not and never was not and never will be a 50-mile stretch that’s uninhabitable.
For evidence I offer the Mara Lago seawall that fell down into the intracoastal some years back. Ol’ boy tried blaming it on airplanes. I personally drove by that place no less than 6-times a day, sometimes more. If you don’t do maintenance, like was never done there on that wall, as evidenced by the cracks in it at the time, then 80-year old structures tend to fail.
This isn’t rocket science or meteorology.
He was sort of right after Andrew. Almost everything south of Cutler Ridge was, if not destroyed, it was pretty close to it. Florida City (right next to Homestead) was gone. Admittedly, very poor area with less than wonderful building construction. We had been living in Homestead until 1990 — two years before Andrew. And building standards were very lax in those days with ‘drive by inspections’ being common. We drove through the area in November three months after Andrew. It was devastated. After Andrew the building codes changed and inspections are much more rigorous. And that uninhabitable stretch now? Completely rebuilt and much pricier than it was back in Andrew’s day. No doubt insurance is expensive, but then it should be.
My daughter and her husband live on the west-central coast just north of Tampa. I don’t know what they pay for home insurance, but it certainly isn’t crippling. They do live a few miles inland (east of 19). When we moved back to Florida in 1997 when the kids were young we lived just north of Tampa as well, though about 20 miles east of the coast (Wesley Chapel). State Farm wouldn’t even write a policy the first year. After that they started writing a few policies and we got in with them.
We moved an hour north in 2015 when the kids left home. When we bought the house in 1998 you couldn’t even get a pizza delivered. When we go back down there now we can’t believe the zoo it has become and are so glad to see it in our rear view mirrors as we head home!
Another meteorologist here in the private sector (aviation & energy markets). Love to see the met presence on Wolf’s blog. And I agree – I wouldn’t touch coastal FL housing properties with a ten foot pole.
…I still worry about the number of Prof.Lysenkos wandering about at our current Politburo’s level…
may we all find a better day.
Hey Wolf,
Any thoughts on Jacksonville’s market?
I’m hoping to buy my first home, but not at these insane prices.
Sincerely,
Dylan V
I’m not commenting at all on your idea of buying a home in Jacksonville or elsewhere. Just generally, as rule of thumb, if the wife says it’s time to buy a home, it’s time to buy a home.
Just note that Jacksonville figured in my list of the biggest price drops for condos, -10% from the peak so far through February:
https://wolfstreet.com/2025/03/21/where-condos-already-came-unglued-10-big-cities-with-price-drops-from-10-to-22-from-peak/
I just checked a hurricane risk map and SW Florida looks like high risk.
The Canadian way of increasing property values is to give millions of study permits with unlimited work hours like candy. That way there’ll be an endless supply of “students” paying rent living 10 to a bedroom.
Even the hurricanes wouldn’t stop that.
I wonder if the Canadian demand for FL has dried up.
Travel demand between the US & Canada is down 70%.
Yes. It’s in the news.
There better be more homes for sale and being built in Florida in 2025 than in 2016 as the population has increased by over 3 million people during that time.
If there are more people, then there should be more buyers, no? It’s the buyers that have left the chatroom, while the sellers are crowding in, LOL.
Add in that used homes are relatively high (if not higher) to new homes with latest code and style/features.
Buyers will start expecting a discount on old homes more, at least the structure.
I know being on strike is just an expression but I wonder how many are just financially priced out versus choosing not buy at these prices. My guess is quite a few as between much higher mortgage payments, taxes and insurance the pay check gets mostly eaten up with that
Howdy Glen. Glad you asked the question about being priced out. There are millions of Prisoners with low mortgage interest rates. USA ZIRPed them. The housing bubble create by Govern ment continues to hiss. Pray it does not POP……
Patiently waiting for a pop here.
It doesn’t matter. Prices are way too high. As simple as that. They shot up 50% or whatever in a couple of years, after already being inflated, and they’re now way too high. Much lower prices will heal the housing market.
Hi Wolf,
You may have written about this topic but I don’t remember reading it.
What percentage of homes in the US are purchased with a mortgage and how many are purchased in cash?
About one-third currently. The ratio is up as people with money invest their own cash instead of borrowing at 6-7%. It’s like a guaranteed 6% return. Makes total sense.
Guaranteed, risk-free, AFTER TAX return of 6%. Even better!
SW Florida home prices peaked in the summer of 2022 and have been falling ever since. There have been two big hurricanes since then (Ian, Milton) and several others that scrapped the coastline (Idalia, Debby, Helene). I live four miles from the coast. My flood and property insurance is $3100 per year. My home is concrete block construction with hurricane windows and sliders. Ian and Milton damaged a lot of homes where I live, but mine, by the grace of God, did not flood or leak.
Those who have lived in Florida for a long time accept the inevitability of hurricanes. As for people leaving in mass due to hurricanes and falling home prices, I don’t buy it (not yet at least). You can still get more for your money in Florida than in Colorado (where I left a few years ago). And if my home declines in value, it doesn’t matter. Maybe my property tax bill and insurance bill will go down? And if I have to move, I sell here and move to another lower priced property.
During the winter, I can swim in an outdoor pool. I can go for leisurely walks on the beach. I am in shorts and t-shirts nearly year round. I don’t shovel snow. That’s my kind of life – but it’s not for everyone.
Homes are places to live, and not “investments” in the typical sense. Buy what you can afford and where you want to live and quit worrying about the market.
Best comment of the bunch.
-50% down in prime FL, and Gattopardo finally gets that Miami Vice pad he’s always wanted….
I have a friend in Orlando who says the same. The impact in Florida is all the investors who bought Airbnb properties that no longer deliver the expected returns, those investors were happy to ride the price increases up, but the exit signals are flashing. If one was planning to get out, the time was last summer.
Totally agree. I’m in Colorado and am a mountain person, but I get the appeal of the beach lifestyle and zero state income tax. FL will continue to grow, especially in the areas that are less expensive. Prices there got bubbly for sure, and a correction is a good thing.
1990s , 2008 all over again. Amazing. Fred Foldvary was right.
Cash is king. Keep an eye on the LOCs soon they will be locking them down.
Seeing the increase in the monthly mortgage payment due to the Feds return to a normal low interest regime was the beginning of this real estate stagnation. Now further uncertainty will do much more damage. Those inventory numbers only have two solutions. Lower price or yank it off the market.
We have all been here before. A decade of inflation, or a slump. Have to sell, welp, find a price that the buyer can do.
The macro economy is always reflected in those animal spirits. Buy or rent based on your needs and how long your term is going to be.
Watch the Marx Brother’s movie ‘”Coconuts”. It about the real estate bust in the 20’s. Nothing changes except the faces.
As a resident of Miami Beach, properly priced properties sell within a month. However there’s a mentality that lists most properties at 10%+ over fair price and those properties linger until they cut prices to “normal” for now which is about $600-$700/sq foot for a “typical” SFR/townhouse or $450-$550 for a typical condo. (No special amenities etc)
“properly priced properties sell within a month.”
1. yes, not in my neighborhood, of course. Miami metro median days on the market before the homes got pulled off the market or before they sold was 67 days in March (realtor.com),
2. You can sell anything if the price is low enough.
I hate to say it, but between DOGE and trade wars and deportations and super low consumer sentiment and crumbling stock prices creating a negative wealth effect and private sector layoffs, the long awaiited and overdue recession will finally arrive.
Trillions in printed money delayed it, but can’t put it off forever.
Recession equals lower interest rates and at some point lower mortgage rates and lower home prices will end the buyer strike.
I agree with you.
But the time it will take before this list from A to Z is realized is unknown. It could take a long time, or it could pass in an instant.
Employment and liquidity will stretch this out indefinitely.
Once investors and speculators start to sell, it will jump into an even higher gear. Overall yields are very low.
The rejected politician turned perpetual housing bear Garth Turner mentioned your graphs from this post
Woulda been nice if:
1. He hadn’t just stolen my chart (copyrighted)
2. And if he steals it, woulda been nice if he had at least attributed it to Wolf Street with a mention and a link in the text. No mention in the text of where it came from.
Over here on the Space Coast, the number of higher end apartment complexes that have been built & many more that are under construction must be a sign. Sell your house & rent.
Over here on the Space Coast, the number of higher end apartment complexes that have been built & many more that are under construction must be a sign. Sell your house & rent.