Are You Prepared for Florida's 2021 Real Estate Market?
Despite the onset of the COVID-19 pandemic and the uncertainty that came with it, the Florida real estate industry has remained strong. In 2021, markets across the Sunshine State are forecasted to continue that upward trend. With demand steadily increasing, low-interest rates motivating buyers, and rapidly rising home sale prices, real estate agents all across Florida should gear up for another scorching year.
2021 Florida Real Estate Outlook: Heating Up
As of December 2020, the average home in Florida was priced at $264,149, a 7.1% increase year-over-year. That figure is expected to increase as Zillow predicts the market will accelerate and rise another 10.1% within the next year. Rising prices, despite 2020’s challenges, are a promising sign that 2021 could be profitable for agents and sellers alike.
Additionally, home sales across Florida grew 22.9% year-over-year in November 2020. The number of days properties spent on the market also fell a significant 21.0% from 81 to 64 days during that same period. Thanks to record low-interest rates and continued strong demand, Florida will likely be a seller’s market as 2021 unfolds.
Rent prices, on the other hand, have decreased 0.6% year-over-year statewide but still remain high when compared to the rest of the country. Meanwhile, a total of 8.2% of Florida mortgages were reported as delinquent, just slightly above the national average of 7.7%. So, while new transactions continue to boom and wonderful weather draws more and more people to Florida, current homeowners will thrive as well.
2020 Florida Real Estate Market Data
|Zillow Home Value Index||$264,149|
|1-Year Change on Home Values||+7.1%|
|1-Year Change on Rent Prices||+2.9%|
|Homes With Negative Equity||3.9%|
|Delinquent on Mortgages||1.5%|
|Buyer’s or Seller’s Market||Seller’s|
Market Insights for Florida
In November 2020, the Bureau of Labor Statistics reported that Florida’s unemployment rate was 6.4%, down from 11.4% in July. As it sits, Florida is just slightly below the national unemployment rate of 6.9%, but that’s likely to change as tourism and hospitality return to normalcy. Economic activity often correlates with growth in the real estate industry, and narrowing unemployment rates along with low-interest rates are a positive sign for agents the year ahead.
Florida also sports some other very attractive features that could positively impact its market. According to our Florida-based Business Development Executive, Andrew Henkins, Florida is a hot spot for those with new work-remote positions looking to escape the high taxes, hustle and bustle, and harsh winters of large northeastern cities. He expects inventory to remain low, which will keep prices high and encourage bidding wars. Florida real estate, while it’s still a great investment that affords homeowners a high quality of life, will play out to be a strong seller’s market in 2021.
With a robust 2021 economic forecast, Florida real estate agents will need to be at the top of their game and prepare clients for the likelihood of bidding wars. More buyers are looking to make Florida their permanent residence and are thus likely willing to pay more, which could push the market to new heights. With a myriad of opportunities on the horizon, there has never been a better time to help your fellow Floridians find the property of their dreams.
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