Florida Housing Market May Be Shifting: 'Add Gas To the Fire'

Despite rising mortgage rates and insurance costs, Florida's housing market remains an attractive place to buy a home. It's currently a balanced market that favors neither buyers nor sellers, but as inventory continues to grow, buyers may find more negotiating power and opportunities to secure favorable deals.

Why It Matters

From 2023 to 2024, Florida saw its population grow by 467,347, according to data from the United States Census Bureau. However, affordability issues have impacted homeownership in The Sunshine State, driven by several factors.

High home prices have made it difficult for many buyers to enter the Florida real estate market. According to data from Redfin, the median home price in Florida is $408,400, which is below the current U.S. median price of $429,963 but still higher than other popular housing markets like Texas and North Carolina. Additionally, rising mortgage rates have increased monthly payments and further strained buyers' budgets.

Moreover, homeowners insurance costs in Florida have surged due primarily to inflation, natural disasters and rising insurance claims. As a result, many aspiring homeowners have been finding it challenging to afford homes, leading to a slowdown in the market and an increased inventory of unsold homes.

The image shows three stucco houses with surrounding palm trees. marchello74/Getty Images

What To Know

The housing market in 2025 could see a shift that favors buyers in The Sunshine State. Hannah Jones, senior research analyst at Realtor.com, told Newsweek it'll be driven by increased housing inventory and home prices dropping. If mortgage rates fall, it would "add gas to the fire" and lower another hurdle in people being unable to afford to buy a home in Florida.

"Florida is currently in a balanced housing market," Jones said. "Though Florida is not yet a true 'buyer's market,' homebuyers are in their most favorable position in more than five years."

According to data from Redfin, November home prices in Florida were up 0.9 percent year-over-year, with a median price of $408,400. The number of homes sold was only 24,135, down 7.9 percent compared to the previous year. There were 198,627 homes for sale, an increase of 22.2 percent from the previous month, resulting in an average of seven months of supply.

Florida Median Home Sales Price

The median sale prices for homes in popular Florida markets highlight the diverse nature of the housing market across the state, with Miami having some of the highest prices and Jacksonville the lowest.

Florida Home Median Days on Market

While some of the more popular markets, like Tampa Bay and St. Petersburg, experience quicker sales, other markets, like Port St. Lucie and Miami, see homes on the market for extended periods.

Number of Homes Sold in Florida Cities

Even when compared to other popular markets, Jacksonville had a much higher rate of homes sold in November. Other regions, like Cape Coral and St. Petersburg, also experienced notable sales activity, reflecting the overall robust demand for housing in these areas.

What People Are Saying

Hannah Jones, senior research analyst at Realtor.com, told Newsweek: "Generally, population growth leads to more housing demand. However, still-climbing inventory and falling prices suggests that the Florida market is well-equipped, in terms of housing availability, to handle population growth."

"Should the rate of population growth outpace inventory growth, recent progress could be reversed and prices could start to climb once again."

What Happens Next

It may seem appealing to wait and see if the housing market in Florida shifts from being balanced to becoming even more favorable for buyers. But not everyone will take that chance. According to WalletHub's recent study on the best places to live, Florida ranked second. In addition, Miami and Orlando ranked in the top 10 of Realtor.com's Top Housing Markets for 2025.

Currently, 30-year mortgage rates are hovering around 7.00 percent, but experts don't see that rate dropping too much in 2025. Fannie Mae noted in December that it expects the average 30-year fixed mortgage rate to be 6.4 percent in 2025. The Mortgage Brokers Association had a similar prediction, suggesting the best rates will be in the 6.4 percent to 6.6 percent range. Given these favorable rankings and the current economic conditions, some buyers may choose to act sooner to find the home of their dreams in The Sunshine State.

Despite rising mortgage rates and insurance costs, Florida's housing market remains an attractive place to buy a home. It's currently a balanced market that favors neither buyers or sellers, but as inventory continues to grow, buyers may find more negotiating power and opportunities to secure favorable deals.