Florida Housing Market Predictions: Will Home Prices Drop in 2024?

October 31, 2023 - 8 min read

Yearning to buy or sell a home in the Sunshine State? You’ve got lots of company. That’s because plenty of people are interested in moving to Florida; in fact, it’s been the most popular state to move to for the past two years, according to data from PODS.

We took a closer look at the Florida housing market to help you make a more informed home purchasing or selling decision. Is now a good time to buy a house in Florida, you ask? When will housing prices drop? Can you expect a better mortgage rate climate next year? Read on for the latest data, insights, analyses, and state housing market predictions 2024 style.

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Florida housing market trends and stats

Here’s what we know about the Florida real estate market, per the latest data (August 2023 numbers) on single-family homes reported by Florida Realtors:

  • 22,917 closed sales in August (down 7.9% year over year)
  • $575,832 average sale price (up 3.7% year over year)
  • $415,000 median sale price (up 2%)
  • 69 days median time to sale (up 21.1%)
  • 28,971 new listings (down 10.8%)
  • 3 months’ supply of inventory (up 25%)
  • 14.9% of homes sold above list price (per Redfin)

U.S. migration trends: Where are Americans moving?

Redfin indicates that Florida boasts five of the top 10 areas in the country people are moving to: Orlando (#3 on the list, with 4,000 net inflow between July and September 2023), Sarasota (#5, 3,700 net inflow), Tampa (#7, 3,400), Cape Coral (#7, 3,300), and Miami (#9, 3,200).

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Florida areas with the largest inbound move rates in 2022 were Ocala (ranked #1 in the country by the National Association of Realtors, with an inbound move rate of 57.1%), Tallahassee (#2 on the national list, 56.6% inbound move rate), Deltona (#6, 55.7%), and Miami (#9, 55.2%).

In fact, Florida was the top state for most net domestic migration gains (318,855) in 2022, the National Association of Realtors reveals. It was also the fastest-growing state last year, with an annual population jump of 1.9% within a year; 2022 marked the first time since 1957 that Florida’s population grew faster than anywhere else across the country.

No Florida city is listed by Redfin among the top 10 metros people are moving from currently. These areas include San Francisco; New York City; Los Angeles; Washington DC; Louisville, Kentucky; Chicago; Boston; Hartford; Connecticut; Detroit; and Denver.

Florida housing market overview 

Ask the experts, and they’ll tell you that Florida remains a robust statewide market for real estate based on sales and sale prices, although sellers have had to adjust to decreased buyer demand in recent months.

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“Home prices remain high compared to historical norms that have started to decline from peak levels reached earlier in 2022,” explains Andrew Lokenauth, a Florida-based housing market expert. “Part of this is due to continued high mortgage rates, which have risen significantly over the past year – now averaging over 7% for a 30-year fixed-rate mortgage. This has impacted affordability. Inventory levels remain historically low, as well, but have improved from the severe shortages seen in 2021 and 2022.”

Vivian Lehman, a broker with You Have Realty in Maitland, Florida, has experienced price drops this year among her seller clients wanting to test the market at over-market prices, “but I still come across multiple offer situations in 2023, especially for homes that are renovated.”

Lehman believes buyer confidence and relative sales will remain high in Florida because the alternative of waiting for a lower mortgage rate will likely not happen anytime soon.

Still, the August 2023 report from Florida Realtors indicates that sales activity has slowed due to high prices, rising rates, and economic uncertainty, with closed sales down nearly 8% year-over-year.

Will home prices drop in Florida in 2024?

While it’s not easy to predict where Florida home prices will land next year, current trends provide some path to prognostication.

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Matt Dunbar, senior vice president of the Southeast Region for Churchill Mortgage, says “there’s little evidence to suggest a significant reduction in Florida’s residential real estate prices is happening in the near future. Over the past decade, Florida’s housing market has seen consistent growth, supported by various factors. The state continues to be a hotspot for migration and retirement, ensuring a steady demand for homes. Moreover, with historically low interest rates in the recent past, many homeowners found little incentive to list their homes and step into a potentially higher interest rate environment for a new mortgage.”

That said, while the market has leaned heavily in favor of sellers in recent years due to tight supply and high demand, the dynamics might shift slightly in 2024.

“The recent uptick in interest rates could somewhat temper demand, as mortgages become more expensive for prospective buyers. However, this doesn’t necessarily imply a sharp drop in prices, but perhaps a moderation of the frenetic pace we’ve seen,” says Dunbar.

Lehman foresees a rise in Florida home prices and home values next year.

“In a normal market of supply and demand, Florida values have historically risen 3% to 4% year-over-year, and I believe by the end of 2024, we will get to that level due to the steady stream of new residents, lower inventory, and hopefully some relief from the Federal Reserve on interest rates and value usually dictates pricing” she continues.

Lokenauth, on the other hand, is more pessimistic about home price growth heading into the new year.

“I expect home prices to decline 5% to 10% in 2024 from current levels as buyer demand weakens and more inventory comes online,” Lokenauth says.

Buying a home in Florida 

Purchasing a home in the Sunshine State is still a worthwhile investment currently, the pros concur.

“That’s because our inventory levels are still low and we continue to have a steady flow of new residents to Florida on a daily basis,” says Lehman. “This influx, along with low inventory, should sustain – if not increase – home values.”

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Lokenauth feels that Florida homes should continue to increase in value into next year, especially due to continued population growth, “but home value and price gains will likely be smaller in 2024 than in recent years. It remains a good time to buy in Florida, or anywhere, if you plan to live in the home long-term. Just expect smaller returns on home appreciation and value next year than in the past two years.”

Here are the 10 most competitive Florida cities, Redfin reports:

  1. Oviedo
  2. Alafaya
  3. Ocoee
  4. Largo
  5. Sanford
  6. Altamonte Springs
  7. Pinellas Park
  8. Winter Springs
  9. East Lake
  10. Horizon West

Selling a home in Florida

As the earlier numbers suggest, most home sellers in Florida can still expect a relatively healthy sale price, with median and average sale prices up 2% and 3.7% year-over-year.

But with continued costly mortgage rates and low housing inventory, it can be challenging for many sellers to get desired offers or to sell their properties quickly (the median time to contract is currently 27 days, up 68.8% since a year earlier, and the median time to sale is 69 days, a rise of 21.1%).

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According to Redfin, here are the 10 Florida metros with the fastest-growing sales price:

  1. Lauderhill 60.5%
  2. North Miami Beach 45.1%
  3. Palm Beach Gardens 38.9%
  4. Destin 38.4%
  5. Tarpon Springs 36.4%
  6. Winter Garden 34.4%
  7. Marco Island 28.7%
  8. Oakland Park 28.6%
  9. Coral Springs 28.3%
  10. Davie 23.0%

Florida market predictions: Will it crash?

It’s doubtful that a housing market recession or real estate sector crash will occur in 2024.

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“Florida markets have been suffering from low inventory all through 2022 and 2023, increasing our home values. Builder inventory hasn’t kept up through 2023 due to fears that homes will not be affordable with higher interest rates,” notes Lehman. “This has further kept inventory low. I believe we will see forced situations of homes for sale in the last quarter of 2023 and 2024, triggered by bank forbearance situations that are now due. This will increase our supply of homes to more normal levels – levels that will not precipitate a market crash.”

Lokenauth is like-minded.

“A housing recession in Florida next year is unlikely. But price drops are possible in overheated areas. Overall, the market should see a normalization,” he says.

Will 2024 be a buyer's or a seller's market in Florida? 

“All things considered, while the 2024 Florida real estate market remains tilted in favor of sellers due to existing homeowners’ reluctance to list, the integration of new construction inventory may begin to bring a more balanced dynamic, offering prospective buyers a breath of fresh air,” Dunbar says.

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Lokenauth notes that buyer demand in Florida has moderated in recent months but remains relatively strong due to Florida’s growing population, job market, and popularity as a retirement destination.

“Bidding wars are less common than last year. And home appreciation has slowed dramatically. Price cuts have become more common as sellers adjust to shifting conditions. This indicates the market is rebalancing in favor of more buyers,” he says.

Lehman agrees.

“As our ongoing issues of high mortgage rates and low housing supply hopefully ease off, we will start to equalize. But I believe we will begin to see more of a buyer’s market toward the end of 2023 and into 2024,” she adds.

The bottom line: 2024 Florida housing market outlook 

Considering that median and average sale prices are higher than a year ago, it may be safe to assume that buyers will be paying more for Florida homes next year. However, the market can change quickly, and price corrections in key metros are already happening. That may continue—particularly if mortgage rates rise while inventory levels increase.

If you’re interested in buying a Florida residence in the coming months, it’s smart to keep an eye on price and rate trends and work closely with a trusted and experienced real estate agent or Realtor who can help you find the right property at the right price.

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Are home prices in Florida going up or down?

Currently, data indicate that Florida home prices are rising slightly. August 2023 numbers from Florida Realtors reveal that median and average sale prices in the state are $415,000 and $575,832, respectively (up 2% and 3.7%, respectively). Year-to-date, median and average home sale prices are up 1.3% and 0.6%, respectively.

Is it a good time to buy a home in Florida?

If you are in a positive financial situation with good job security, the ability to afford a down payment, closing costs, and a monthly mortgage, and are relatively confident that mortgage rates will not significantly decrease in the coming months, now can be a great time to purchase in Florida or any market. Just be sure to crunch the numbers carefully, partner with a real estate agent you can trust who knows your desired market, and get prequalified for a mortgage loan before you start home shopping.

Why is Florida becoming more expensive?

A big reason why home prices continue to climb in Florida is that it’s the top state for inbound movers, with several Florida cities and markets ranking in the top 10 areas in the country people are moving to. Sellers can command higher prices compared to other areas of the country in large part because Florida remains a popular moving destination, thanks to its more preferred sunny and warm climate, scenic coastal areas, popular sports teams, and no income tax charged.

Erik J. Martin
Authored By: Erik J. Martin
The Mortgage Reports contributor
Erik J. Martin has written on real estate, business, tech and other topics for Reader's Digest, AARP The Magazine, and The Chicago Tribune.
Aleksandra Kadzielawski
Reviewed By: Aleksandra Kadzielawski
The Mortgage Reports Editor
Aleksandra is the Senior Editor at The Mortgage Reports, where she brings 10 years of experience in mortgage and real estate to help consumers discover the right path to homeownership. Aleksandra received a bachelor’s degree from DePaul University. She is also a licensed real estate agent and a member of the National Association of Realtors (NAR).