What are the Florida housing market predictions in 2025? For stakeholders, including real estate agents, home sellers, home buyers, and renters, these yearly predictions help determine what they should buy, sell, or invest in.
Florida Housing Market Predictions for 2025
Florida’s real estate market experienced highs and lows in the third quarter of 2024. Despite a rise in inventory, home sales dropped, according to September data.
According to the Florida Realtors® Research Department, single-family home sales dropped in September by 12.3% year on year. Meanwhile, sales of condominiums and townhouses fell by 20.7% compared to September 2023.
While this sounds alarming, what caused this is more complex, considering recent statistics and events.
For example, Hurricane Helene, which hit the state in late September, impeded the market when it hit. Another thing to consider is that the current statistics’ point of comparison, September 2023, saw atypically strong sales. Typically, home sales slow down from August to September, which was not the case last year. This made 2024’s data look much worse than it is.
Florida Market Predictions in 2025: Transitioning to a Buyer’s Market
The housing market nationwide has generally gained inventory in the past year. While this trend is common nationwide, it is glaringly evident in Florida.
In 2024, the state’s active inventory levels rose by 59%, reaching 161,966 properties in August. In the same period last year, Florida’s inventory was only 101,890. This increase in inventory led to a rise in the month’s supply of inventory. This metric stands at 5.3 months, up compared to 3.2 months in 2023.
With the inventory increasing, Florida’s housing market will likely balance itself or start to favor buyers in 2025. The increased supply of properties gives buyers more choices while giving them better bargaining power.
With this shift, sellers’ pricing strategies must become more realistic and aligned with the current market. Properties with reasonable prices in prime locations will not have difficulty finding buyers. However, those with exorbitant prices or even slightly overpriced may have to stay on the market longer.
Modest Movement in Home and Rental Prices
In August 2024, the state’s median sale price for single-family homes was $380,000, while the average sale price dropped by 1.6% to $517,564. This slight drop shows the housing market is stabilizing, following the boom it experienced during the COVID-19 pandemic. With this, predictions say that home prices will remain relatively stable, and any fluctuations will be modest and dependent on state supply and demand.
Given this, Zillow estimates that home prices in Florida will continue to creep up as the end of the year approaches and will continue this slow crawl into 2025. Spikes in prices observed during the pandemic years (2020-2022) are unlikely to happen.
Median home prices in Florida may reach $420,000 in 2025, indicating a 3.6% uptick from the current levels. Goldman Sachs estimates a slightly higher increase, predicting that home price hikes will reach 3.7%.
Rent prices are also predicted to increase, with median prices projected to be at $2,100 monthly, indicating a small 2% increase.
Should You Buy a Home in 2025?
Given recent unpredictable trends, many are wondering if it’s finally a good time to buy a home in 2025.
Before closing a deal, many potential buyers must consider a long list of factors, including their current financial capacity, budget, priorities, and long-term and future goals.
Given the recent trends and predictions, it is possible that 2025 would be a good time to buy property in Florida. Here are possible factors to consider:
- With the rise of inventory, buyers have many properties to choose from. As a result, buyers are better positioned to negotiate the deal’s sales price and other aspects.
- As it stabilized, Florida’s housing market started to wind down. This provides buyers with more time to research and evaluate potential properties.
- Since the state’s market is winding down, more and more home sellers are lowering prices to attract buyers potentially.
Mortgage Rates to Further Decline
According to Freddie Mac, mortgage rates have recently tanked to their lowest level in over a year. With this, more interest rate cuts are predicted as the Fed is expected to drop rates further in early 2025. However, the 3% mortgage rates common during the pandemic will likely not appear in 2025.
A Shift in Buyer Demographics
Along with the changes in Florida’s housing market predicted for next year, it seems there will also be a shift in buyer demographics.
NAR’s Deputy Chief Economist Jessica Lautz outlined buyer behavior and demographics changes. These changes include the following:
- More buyers are skipping mortgages and opting instead for all-cash payments.
- The median age of first-time buyers was 38, considered an all-time high.
- While people flocked to the suburbs during the pandemic, in 2025, more people are opting to return to the cities.
- Home buyers are now preparing by pooling their money with other family members to afford ownership.
- Among property buyers, single women are outpacing male buyers.
A Shift After a Market Spike
The pandemic caused a massive boom in Florida’s housing market, which saw high demand and reasonable prices for homes. However, the market started calming down in 2023, and this lull will likely continue into the new year. Despite this, the housing market in the state remains healthy, with market crashes not happening any time soon.
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