The nation’s real estate recovery has finally reached a state hit hardest by the housing crisis — Florida. Over the last year, median home prices have risen in many parts of Florida. Here are seven metro-sized examples:
Details: This list is based on housing data provided by Realtor.com. The numbers in green represent the change in median home prices from the third quarter of 2011 to the third quarter of 2012. The most recent median prices are shown in parentheses.
1. Cape Coral – Fort Myers: +27.6 ($127,000)
In 2010, the New York Times referred to Cape Coral, Florida as “a reluctant symbol for the excesses of the great American real estate bubble.” That was then, and this is now: According to Realtor.com, the median home price in Cape Coral rose by 27.6%. That was the largest gain, by far, of any metropolitan area in Florida.
The number of Cape Coral / Fort Myers real estate listings dropped by 16%, from the third quarter of 2011 to the same period in 2012.
2. Miami – Fort Lauderdale – Miami Beach: +12.0% ($209,200)
Inventory is down, prices are rising, and homes are selling faster than a year ago. That’s the current trend within the Miami real estate market, and much of Florida for that matter. The median home price in the Miami metro area rose by 12% during the reporting period, according to Realtor.com. Inventory is down by nearly 20%.
Emboldened by the nascent recovery, sellers are setting higher asking prices — the median list price climbed 11% over the last year. The S&P/Case-Shiller Home Price Index shows a 7.4% gain in Miami house prices, from September 2011 to September 2012.
3. Tampa – St. Petersburg – Clearwater: +8.2% ($138,000)
Case-Shiller reports a 5.5% gain in Tampa metro-area home prices. Realtor.com shows an increase of 8.2% in the median price for this area. However you slice the data, it’s good news for homeowners who watched their property values plummet during the bust.
Over the last decade, the Tampa area has attracted an average of 38,700 new residents per year. This increased demand for housing is a major factor in the ongoing real estate recovery. Construction is ramping up to meet the rising demand. The third quarter of 2012 was the best quarter in five years for new home starts.
4. Palm Bay – Melbourne – Titusville: +6.4% ($119,400)
In February 2011, CNN Money published a story entitled ‘Housing Market: Best Recovery Bets.’ It was a series of predictions, a list of metro-level real estate markets that would see the largest price gains in 2012. Palm Bay, Florida was ranked #2 with a forecasted gain of 9.4%. They weren’t far off. According to Realtor.com, the median home price for this metro area rose by 6.4%.
Interestingly, Zillow reports a one-year increase of 9.3% in the median sale price for the Palm Bay area — almost identical to CNN’s earlier prediction.
5. Orlando: +5.5% ($135,400)
New construction is making a comeback in the Orlando metro area. Orlando recently had its busiest quarter for new home closings since December 2008. In October 2012, existing home sales in the Orlando area climbed 14% from a year earlier.
Bank-owned homes and short sales currently account for 55% of all residential sales, an improvement over last year. The median home price for this MSA has increased by 5.5% over the last year or so, according to Realtor.com.
6. Daytona Beach – Ormond Beach: +4.8% ($111,100)
Volusia County is on track to have its best year for existing home sales since 2005. And 2013 could be even stronger. During the first 10 months of this year, 3,133 existing homes were sold in Daytona Beach alone, up from 2,957 in 2011.
Housing demand has grown in this market, as evidenced by a 21% reduction in inventory. The median home price rose 4.8% from the third quarter of 2011 to the same period in 2012.
7. Jacksonville: +4.0% ($131,900)
The Jacksonville real estate market is showing mixed results, in terms of home prices. Some zip codes in this metro area are still in the red, while others have appreciated over the last year. According to Realtor.com, the median home price in Jacksonville rose by 4% during the aforementioned reporting period. Zillow shows a similar increase of 4.4% in the median sale price, over the last year or so.
The number of Jacksonville homes listed for sale on Realtor.com has dropped by more than 20% over the last year.
Outlook for Florida Real Estate Markets in 2013
California’s housing recovery has swept across the entire state, with home prices rising in nearly every city. Florida is different. The real estate recovery in Florida could be described as ‘spotty.’ Some cities in the Sunshine State are still dealing with excess inventory and price erosion. But 2013 could be the long-awaited statewide turning point.
Our outlook for the Florida housing market is mostly positive. Low mortgage rates, combined with slow but steady improvements in the job market, will bring more buyers into the market. Investors will continue buying bargain-priced properties, further reducing inventory in most areas. In October 2012, 44% of residential sales were paid for in cash. This indicates a high level of demand from investors, who typically pay cash for homes. We expect this trend to continue into 2013. Consumer confidence will rise in response to market stability.
But again, the results of all these changes will be uneven. Some Florida markets could experience double-digit price gains in 2013. Others will remain stagnant or only experience modest growth. Overall, 2013 should be a better year than 2012.
“I think the improvement in the market and rising prices will bring more potential sellers back into the market,” said Dr. John Tuccillo, chief economist for Florida Realtors. “Signs point to a better year in 2013.”
Disclaimer: This story contains forward-looking statements about home prices, mortgage rates, and other economic conditions. This information has been provided for educational purposes only, and does not constitute financial advice. We make no guarantees or assertions about future conditions within this or any other housing market.