Real Estate Market in Florida: More Sales and New Listings, Median Prices Up

 By Marla Martin

Florida's single-family closed sales up 4.2% YOY, median price up 3.3% ($413K). Condo sales up 0.3%, median price up 7.5% ($330K); new listings also up.

ORLANDO, Florida. – Florida’s housing market reported more new listings and higher statewide median sales prices in November compared to the previous year, according to Florida Realtors®’ latest housing data.

“November brought some welcome news for Florida homebuyers, as mortgage rates started to ease and the inventory (active listings) of for-sale properties increased statewide,” says 2023 Florida Realtors® President G. Mike McGraw, a broker-associate with LPT Realty in Orlando. “The inventory for existing single-family homes rose 13.9% last month, while the inventory for condo-townhouse units increased by 49.8%. It means more housing options are now available for buyers who may have been discouraged during previous home searches.”

Last month, closed sales of existing single-family homes statewide totaled 17,722, up 4.2% year-over-year, while existing condo-townhouse sales totaled 7,108, a slight rise of 0.3% over November 2022, according to data from Florida Realtors Research Department in partnership with local Realtor boards/associations. Closed sales may occur from 30- to 90-plus days after sales contracts are written.

“Lately, prospective buyers in Florida have seen an increasing number of choices in their home searches,” says Florida Realtors Chief Economist Dr. Brad O’Connor. “The number of new listings was uncharacteristically low at this time last year, but over the last couple of months, we’ve seen the level of new listings move back into the range of recent norms. New listings of single-family homes in Florida were up by 15.3% in November compared to a year ago. And over in the townhouse and condo category, new listings were up even more, rising by 25.9%.”

He adds, “With these significant increases in new listings compared to a year ago outpacing the very modest increase in sales over the same timeframe, inventory levels continued to rise in Florida. In fact, the current trajectory of inventory growth is such that we may be back at pre-pandemic levels of single-family inventory as soon as the end of the year. At this time in 2019, Florida was still experiencing a single-family inventory shortage – just not nearly as severe as what we faced after the pandemic began. Inventory gains in the condo-townhouse category last month were significant, as well.”

The statewide median sales price for single-family existing homes in November was $413,000, up 3.3% from one year earlier. For condo-townhouse units, the median price was $330,000, up 7.5% from a year earlier.

Florida had a 3.7-months’ supply of single-family existing homes last month, up 32.1% year-over-year. Meanwhile, condo-townhouse units reported a 5-months’ supply last month, up 85.2% over the Nov. 2022 level.

To see the full statewide housing activity reports, go to the Florida Realtors Newsroom and look under Latest Releases or download the November 2023 data report PDFs under Market Data.

© 2023 Florida Realtors®

NAR: Existing-Home Sales Grow in November, Ending Five-Month Slide

 By Amy Connolly

NAR’s chief economist says home prices keep moving higher. The median home sale price in the South was up 3.4% from last year to $351,500.

WASHINGTON – Existing-home sales grew in November, breaking a streak of five consecutive monthly declines, according to the National Association of Realtors® (NAR). Among the four major U.S. regions, sales climbed in the South and Midwest but receded in the Northeast and West. All four regions experienced year-over-year sales decreases.

Total existing-home sales – completed transactions that include single-family homes, townhomes, condominiums and co-ops – elevated 0.8% from October to a seasonally adjusted annual rate of 3.82 million in November. Year-over-year, sales fell 7.3% (down from 4.12 million in November 2022).

“The latest weakness in existing home sales still reflects the buyer bidding process in most of October when mortgage rates were at a two-decade high before the actual closings in November,” said NAR Chief Economist Lawrence Yun. “A marked turn can be expected as mortgage rates have plunged in recent weeks.”

According to Freddie Mac, the 30-year fixed-rate mortgage averaged 6.95% as of Dec. 14, falling below 7% for the first time since Aug. 10. That's down from 7.03% the previous week but up from 6.31% one year ago.

Total housing inventory registered at the end of November was 1.13 million units, down 1.7% from October but up 0.9% from one year ago (1.12 million). Unsold inventory sits at a 3.5-month supply at the current sales pace, down from 3.6 months in October but up from 3.3 months in November 2022.

The median existing-home price for all housing types in November was $387,600, an increase of 4.0% from November 2022 ($372,700). All four U.S. regions posted price increases.

“Home prices keep marching higher,” Yun added. “Only a dramatic rise in supply will dampen price appreciation.”

Notable takeaways from November:

• According to the monthly Realtors Confidence Index, properties typically remained on the market for 25 days in November, up from 23 days in October and 24 days in November 2022. Sixty-two percent of homes sold in November were on the market for less than a month.
• About a third (31%) of November sales went to first-time homebuyers, up from 28% in October 2023 and November 2022. NAR's 2023 Profile of Home Buyers and Sellers – released on Nov. 4 – found that the annual share of first-time buyers was 32%.
• Individual investors or second-home buyers, who make up many cash sales, purchased 18% of homes in November, up from 15% in October and 14% one year ago.
• Distressed sales – foreclosures and short sales – represented 1% of sales in November, virtually unchanged from last month and the previous year.

Also:

Single-family and Condo/Co-op Sales

• Single-family home sales increased to a seasonally adjusted annual rate of 3.41 million in November, up 0.9% from 3.38 million in October but down 7.3% from the prior year. The median existing single-family home price was $392,100 in November, up 3.5% from November 2022.

• Existing condominium and co-op sales recorded a seasonally adjusted annual rate of 410,000 units in November, identical to October and down 6.8% from one year ago. The median existing condo price was $350,100 in November, up 8.6% from the previous year ($322,400).

Regional Breakdown

• Existing-home sales in the South improved 4.7% from October to an annual rate of 1.77 million in November, a decline of 4.3% from the prior year. The median price in the South was $351,500, up 3.4% from last year.

• Existing-home sales in the Northeast slipped 2.1% from October to an annual rate of 470,000 in November, down 13.0% from November 2022. The median price in the Northeast was $428,600, up 4.8% from the prior year.

• In the Midwest, existing-home sales rose 1.1% from the previous month to an annual rate of 940,000 in November, down 8.7% from one year ago. The median price in the Midwest was $280,800, up 4.9% from November 2022.

• In the West, existing-home sales slumped 7.2% from a month ago to an annual rate of 640,000 in November, down 8.6% from one year before. The median price in the West was $603,200, up 5.3% from November 2022.

© 2023 Florida Realtors®

Home Construction Unexpectedly Surges in November

 By Amy Connolly

The National Home Builder’s Association also said apartment and condo starts increased 6.9%.

WASHINGTON – New single-family home construction hit an unexpected high in November, bolstered by strong demand and lower interest rates, the National Association of Home Builders (NAHB) said Tuesday.

Overall housing starts increased 14.8% in November to a seasonally adjusted annual rate of 1.56 million units, according to a report from the U.S. Department of Housing and Urban Development and the U.S. Census Bureau.

The November reading of 1.56 million starts is the number of housing units builders would begin if development kept this pace for the next 12 months. Within this overall number, single-family starts increased 18% to a 1.14 million seasonally adjusted annual rate. However, single-family starts are down 7.2% year-to-date. The multifamily sector, which includes apartment buildings and condos, increased 6.9% to an annualized 417,000 pace.

“Lower interest rates and a lack of resale inventory helped to provide a strong boost for new home construction in November,” said Alicia Huey, NAHB chairman. “And while these higher starts numbers are consistent with our latest builder survey, which shows a rise in builder sentiment and future sales expectations, home builders continue to contend with elevated construction and regulatory costs.”

“The single-family starts figure is remarkably strong, and we would not be surprised to see this figure revised lower or fall back slightly in the next month, given the nearly 20% rise in November,” said NAHB Chief Economist Robert Dietz. “NAHB is forecasting an approximate 4% gain for single-family starts in 2024 as mortgage rates settle lower, economic growth slows and inflation moves lower.”

On a regional and year-to-date basis, combined single-family and multifamily starts are 16.7% lower in the Northeast, 12.3% lower in the Midwest, 6.2% lower in the South and 14.3% lower in the West.

Overall permits decreased 2.5% to a 1.46 million unit annualized rate in November. Single-family permits increased 0.7% to a 976,000 unit rate. However, single-family permits are down 8.4% year-to-date. Multifamily permits decreased 8.5% to an annualized 484,000 pace.

Looking at regional permit data on a year-to-date basis, permits are 19.9% lower in the Northeast, 15.3% lower in the Midwest, 10.3% lower in the South and 12.8% lower in the West.

© 2023 Florida Realtors®

Deadlines Loom for Some Florida Foreign Landowners

 By Kerry Smith

The law that applies to some foreign principals who own/acquire certain Florida properties has registration deadlines. Buyers should speak to counsel about legal obligations.

TALLAHASSEE, Fla. – SB 264 – a bill passed during the 2023 session of the Florida Legislature, signed into law by Gov. Ron DeSantis, and effective on July 1, 2023 – limits and regulates the sale, purchase and ownership of certain properties in Florida by foreign principals, persons and entities described in Part III of Chapter 692, Florida Statutes.

Those foreign principals covered by the new law – associated with China (PRC), Russia, Iran, North Korea, Cuba, Venezuela and Syria – who already owned certain Florida land prior to July 1, 2023, have registration deadlines coming up, and they may face stiff penalties for missing some of those deadlines.

SB 264 also includes a registration requirement for covered foreign principals who acquire certain Florida property afterJuly 1, 2023.

Realtors, however, are not part of the registration process – and, due to the complexity of the new law, should advise their customers with questions to speak to counsel about their legal responsibilities.

Foreign principals covered by the law must register with the Florida Department of Agriculture and Consumer Affairs if the sale, ownership or acquisition involves agricultural land – and only agricultural land.

If NOT agricultural land, foreign principals covered by the law must register with the Department of Commerce for the purchase, sale, ownership and acquisition of real property if:

• That property is within 10 miles of either a military installation or critical infrastructure (or not within 5 miles of a military installation if the statutory exception applies) OR
• Where the purchase, sale or acquisition of any nonagricultural property is by a foreign principal associated with the PRC, as defined by the law.

Ownership of agricultural land

A foreign principal that “directly or indirectly owns or acquires agricultural land or any interest in such land in this state” before July 1, 2023, must register with the Department of Agriculture and Consumer Services by Jan. 1, 2024, except if their interest is divested by January 1, 2024.”

If a foreign principal registers after Jan. 31, 2024, they face fines – a civil penalty of $1,000 for each day that the registration is late and the department can place a lien against the unregistered  agricultural land for the unpaid balance of any penalties and ultimately may file a civil action for forfeiture. 

Of Note: This final rule from the Florida Department of Agriculture is still pending. However, should the current proposed rule become effective, it “will require registration for foreign principals who acquire a direct or indirect ownership interest after July 1, 2023, (through devise, or descent or because of a security interest or collection of debt) within 30 days from the effective date of the rule and, following the effective date of the rule, within 30 days after the property is acquired

Proximity to a military installation or critical infrastructure

The Florida Department of Commerce (formerly the Department of Economic Opportunity) oversees all other registration by foreign principals per SB 264.

A foreign principal that “directly or indirectly owned or acquired land or any interest in such land within 10 miles of a military installation or critical infrastructure in this state” before July 1, 2023, must register with the Department of Commerce by Dec. 31, 2023. If a foreign principal registers after Jan. 31, 2024, they face fines – a civil penalty of $1,000 for each day that the registration is late.

The statute also requires registration within 30 days of acquisition if the foreign principal acquires (by devise, descent, debt collection or by purchase that complies with the statutory exception) such property after July 1, 2023.

However, the pending Department of Commerce rules for registration state that registration for properties acquired by foreign principals shall be within 30 days from the effective date of the rule and, following the effective date of the rule, within 30 days after the property is acquired.

There is another noteworthy registration requirement that applies to foreign principals with equitable title to certain properties: The rule, should it go into effect, will also require registration with the Department of Commerce within 120 days of contract execution if a natural person is A) a foreign principal under the law (either has a current U.S. visa not limited to tourist-based travel or been granted asylum in the U.S.), B) enters into a contract to purchase one residential property, less than 2 acres (i.e. pursuant to the statutory exception, not within 5 miles of a military installation) and C) has no obligation to close within 90 days.

A civil penalty of $1,000 per day would also apply to failing to register equitable title under the proposed regulation.

Rules specific to citizens of the People’s Republic of China

In addition, the registration requirements apply to certain individuals and entities associated with the PRC. If these foreign principals associated with the PRC owned Florida agricultural property prior to July 1, 2023, registration is required with the Department of Agriculture and Consumer Affairs by Jan. 1, 2024, as described above.

If these foreign principals associated with the PRC owned Florida nonagricultural property prior to July 1, 2023, registration is required with the Department of Commerce by Dec. 31, 2023, as described above.

The registration of either one is considered late after Jan. 31, 2024. 

In addition, if a foreign principal associated with the PRC acquires Florida property either by devise, descent, enforcement of security interest, through collection of debt or if a natural person acquires a direct or indirect ownership interest per the statutory exception after July 1, 2023, the statute specifies that registration is required within 30 days of an acquisition.

Related resources and earlier stories

• Overview of SB 264 with flowcharts showing the impact on certain buyers and sellers
• Florida Realtors Memorandum: Foreign RE Purchases
• Dept. of Agriculture Publishes Proposed Foreign-Buyer Rule
• FREC Publishes Proposed Affidavit Rule
• Rule-Making Begins on Foreign Buyer Law

© 2023 Florida Realtors®

NAR Forecasts 2024 Stronger Sales Activity

 By Jessica Lautz

CHICAGO – For the first time since August, interest rates for a 30-year fixed mortgage have dropped below 7%, hitting 6.95% this week. This brings the monthly mortgage payment for a home priced at $400,000 to $2,118. This is down from a recent high this Autumn of 7.79% and yields a monthly savings of $183 and $2,196 annually for the same $400,000 home.

The Fed indicated yesterday they will hold the Fed Funds Rate steady for now and cut rates three times in 2024. This is all welcome news for potential home buyers and sellers, as mortgage interest rates will decrease. NAR forecasts that mortgage interest rates will average 6.3% in 2024.

While the lock-in effect of higher mortgage rates has stalled the real estate market in 2023, the momentum is moving in the right direction for stronger sales activity in 2024. Will it be a traditional Spring real estate market, or will it start to heat up in the Winter months as rates decline? Let’s also hope the lower mortgage interest rates translate into stronger homebuilder activity, as inventory will be needed as buyers move from the sidelines. For serious buyers, the time is now to get your financial house in order, find a Realtor® and start your research. Maybe it won’t be a new home for the holidays, but Valentine’s Day is right around the corner.

© 2023 National Association of Realtors® (NAR)

NAR’s Forecasts 4.71 million Existing-Home Sales in 2024

 Lawrence Yun also said the housing market will improve for buyers next year.

WASHINGTON – NAR Chief Economist Lawrence Yun forecasts 4.71 million existing homes will be sold, the housing market is expected to grow, and Austin, Texas, will be the top real estate market to watch in 2024 and beyond. Yun unveiled the association's forecast yesterday during NAR's fifth annual year-end Real Estate Forecast Summit: The Year Ahead.

Yun predicts home sales will begin to rise next year – by 13.5% compared to 2023, and the median home price will reach $389,500 – an increase of 0.9% from this year.

"Metro markets in southern states will likely outperform others due to faster job increases, while markets in the Midwest will experience gains from being in the most affordable region."

Yun expects rent prices to calm down further in 2024, which will hold down the consumer price index. He predicts foreclosure rates will stay at historically low levels in 2024, comprising less than 1% of all mortgages.

Yun forecasts the U.S. GDP will grow by 1.5%, avoiding a recession, with net new job additions slowing to 1.7 million in 2024 compared to 2.7 million in 2023, and 4.8 million in 2022. After eclipsing 8% in late 2023, he expects the 30-year fixed mortgage rate to average 6.3% and for the Fed to cut rates four times – calming inflationary conditions – in response to slower economic activity.

Yun also foresees 1.48 million housing starts in 2024, including 1.04 million single-family and 440,000 multifamily.

Top 10 Real Estate Markets with the Most Pent-Up Housing Demand in 2024

NAR identified 10 real estate markets with the most pent-up housing demand, which it expects to outperform other metro areas in 2024. In order, the markets are as follows:

1. Austin-Round Rock-Georgetown, Texas
2. Dallas - Fort Worth-Arlington, Texas
3. Dayton - Kettering, Ohio
4. Durham - Chapel Hill, N.C
5. Harrisburg-Carlisle, Penn.
6. Houston-The Woodlands-Sugar Land, Texas
7. Nashville-Davidson-Murfreesboro-Franklin, Tenn.
8. Philadelphia-Camden-Wilmington, Pennsylvania-New Jersey-Delaware-Maryland
9. Portland-South Portland, Maine
10. Washington-Arlington-Alexandria, D.C.-Virginia-Maryland-West Virginia

"The demand for housing will recover from falling mortgage rates and rising income," Yun said. "In addition, housing inventory is expected to rise by around 30% as more sellers begin to list after delaying selling over the past two years. The selected top 10 U.S. markets will experience faster recovery in home sales."

NAR selected the top 10 real estate markets with the most pent-up housing demand in 2024 based on how they compared to the national level on the following economic indicators: 1) more "returning" buyers; 2) lower home price appreciation; 3) more renters who can afford to buy the median-priced home; 4) more potential sellers; 5) a larger decrease in remote workers; 6) more affordable listings for first-time buyers; 7) stronger job growth; 8) faster income growth; 9) most high-earner millennial renters moving into the area; and 10) lower violent crime rate.

To read more about NAR's Markets with the Most Pent-Up Housing Demand report, click here. This and all forecast summit materials – including a video recording and Yun's presentation slides – will be available here.

© 2023 Florida Realtors®

Poll: Housing Costs a Top Concern of Florida Voters

 By Kerry Smith

A University of North Florida poll found “economy, jobs, and inflation” concerns second to “housing costs” to voters considering candidates for office in 2024.

JACKSONVILLE, Fla. – A new poll from the University of North Florida’s (UNF) Public Opinion Research Lab (PORL) asked registered voters across Florida their opinions about state and national policy issues.

Respondents were asked what they think is the most important problem facing Florida today, to which the top response was housing costs with 26%.

In a close second place is the economy, jobs and inflation with 25%. Education and immigration tied for third most important problem, with 9% each.

In a separate question, respondents were asked who or what they think is most responsible for the state of property insurance in Florida:

• 30% believe insurance companies bear the greatest responsibility,
• 15% place the blame on individuals and lawyers defrauding or exploiting insurance companies
• 13% said Gov. Ron DeSantis
• 13% cited natural disasters
• 12% named the Florida Legislature

“In the last year, housing costs, and now property insurance, have emerged as pressing issues to Floridians,” says PORL faculty director and professor of political science Dr. Michael Binder. “Insurance companies are most responsible in the minds of these Florida voters, but there seems to be plenty of blame to go around.”

In addition to housing concerns, respondents were asked about their support for two constitutional amendments likely to appear on the ballot in 2024. One supports abortion, the other supports recreational marijuana. According to researchers, both have enough support right now to surpass the necessary 60% of voters threshold, with 62% favoring the abortion proposal and 67% supporting recreational marijuana.

© 2023 Florida Realtors®