Along with Arizona, Nevada, and California, Florida took a beating when the housing bubble burst nearly six years ago.
Floridas home prices dropped more than 48 percent from the first quarter of 2007 to the first quarter of 2013. Experts chalk up the devastation to overbuilding combined with high unemployment.
According to RealtyTrac, Florida ranks third among all states in foreclosures.
Still, the state is beginning to recover, with home prices increasing 6.6 percent between 2012 and 2013, and the median home price hovering at $236,000.
In January, TheStreet.com reported that Florida’s home prices remain low, but prices are gradually increasing.
According to TheStreet.com, “a large portion of Florida’s housing market is driven by people who don’t really need to buy, such as retirees who could stay where they are in other parts of the country and second-home buyers who could wait if conditions aren’t right. That makes them more fickle than people who must move for a job or growing family. As a result, Florida home prices tend to swing to extremes.
“Now things are getting better. The number of housing sales that closed in December was nearly 16 percent higher than a year earlier, according to Florida Realtors, a trade group. And the number of pending sales, or those with signed contracts that have not yet closed, was up nearly 40 percent. The median sales price remained affordable, at $154,000, up about 14 percent from a year earlier. Nationally, the median sales price was $180,600 in November, a 10 percent increase from a year earlier.”
By December, St. Lucie, Fla. had seen its available housing inventory drug from 40 months worth in 2006 to four months worth.
“The market right now is responding to that low inventory and strong demand. Demand is up quite a bit over last year as well. The result is an increase in median prices,” said Donn Wonderling, President-Elect of the Realtors Association of St. Lucie. “Demand has been strong. Investors are coming into the market to buy real estate they see as an opportunity to make money.”
For South Florida, 2012 was the strongest year in real estate since the crash began in 2006. The market showed slow progress in 2012 with a 1 percent increase in the real estate index every month. The latest Case-Shiller report predicts this growth could lead to full real estate recovery within the next five-to-six years.
Home prices in the Miami area were up 10.8 percent for the year ending in January, Standard & Poor’s Case-Shiller said in its look at 20 key housing markets.
The Wall Street Journal said economists told Reuters they expected a 7.9 percent increase nationally, but S&P found an 8.1 percent increase for its 20-city composite and a 7.3 percent increase for its 10-city composite.
The Palm Beach Post published an article in March of 2013 headlined “Palm Beach County home prices up 27 percent from a year ago” that reads in part, “is the boom back? Palm Beach County’s housing market continued its dramatic rebound in February.
“The median price of an existing home sold in the county rose to $235,000, up 27 percent from a year ago and 8 percent from January, the Realtors Association of the Palm Beaches said today. Sales volumes continued to rise, too. There were 1,012 single-family home sales last month, up 9.6 percent from a year ago and up 5 percent from last month. … Such a strong spike in home prices brings back memories of the disastrous bubble of 2005, but the market is much different now. Prices plunged by more than 50 percent from their 2005 peak before bouncing back.”
The number of foreclosure sales Palm Beach County fell 40 percent from a year ago, while short sales decreased 9 percent. Traditional sales grew 25.7 percent.
Dick Picard, a Daytona Beach Realtor, wrote the following in Realty Times: “inventories of single-family homes in Daytona Beach have continued to drop. In 2012 they dropped about 2.6 percent from 2011, and they had dropped quite a bit from 2010 to 2011. As of the end of 2012, inventory was at about 5.6 months compared to 9.2 months a year earlier.
“Comparing 2012 with 2011 shows beachside properties up by 1.7 percent and mainland properties up by 3.1 percent. Mainland properties dropped in price significantly in 2011 so that trend has been reversed. Many of the lower-priced distressed properties have flushed out but there are still good deals to be had. With the history-making interest rates, this is a great time to be a buyer.”
According to a January article in the Florida Current (“Florida home and condo sales, prices shoot up in December”), sales and prices for existing single-family homes and condominiums rose sharply in December.
The article continued, “home resales jumped 15.8 percent last month in the year-over- year comparison, and the median sale price of $154,000 is a 14.1 percent increase over December 2011. The median number of days on the market for home resales fell from 71 days to 59 days. Condo sales rose 8.6 percent, with the median sale price jumping 26.3 percent to $117,500. The median amount of days for condos on the market fell by five days to 60 days on the market.”
An article published in March in the Miami Herald (“Has S. Florida experienced its last boom-bust cycle?”) postulates that the state’s real estate market has seen the last of volatility. It reads, “after all, South Florida has a long history of real estate booms and busts dating back to at least the 1920s.
“Despite shrinking residential inventory in recent quarters, some could argue the tricounty region of Miami-Dade, Broward and Palm Beach — saddled by an unknown amount of shadow distressed real estate — is still in the midst of a bust that began in 2007 after four years of rampant residential development and condo conversions.
“Proponents counter that South Florida has experienced a somewhat quick recovery — despite a difficult mortgage market — from a real estate crash that many projected would take a decade to recover from given the oversupply of new and resale residences available some six years ago.
“As of the first quarter of 2013, South Florida’s resale inventory represents about 30 percent of the nearly 110,000 single-family houses, condos and townhouses on the market back in the fourth quarter of 2008, according to data from the Southeast Florida MLXchange.”
Whether the market recovers rapidly, or with sporadic gains – there seems to be an overwhelming consensus among experts that the market is on its way up.