In many ways, the U.S. housing recovery began in California. Home prices in most parts of the Golden State began stabilizing two years ago, and have been rising since.
Now the recovery is spreading to another one of the Sand States — Florida.
By most accounts, the Florida real estate market has entered a period of recovery. The state’s Realtor association recently reported that home sales and median prices both rose in 2012.
“Throughout 2012, we’ve seen increasingly strong signs that the state’s housing market is in solid recovery,” said Dean Asher, current president of Florida Realtors.
Some have gone so far as predicting a ‘mini boom’ for Florida real estate over the next couple of years, particularly in cities like Miami where demand is highest.
Here are the latest numbers coming out of Florida’s major housing markets:
Median List Price, Sales Price Up in Most Florida Markets
Each month, Realtor.com publishes a housing summary for 146 metro areas in the United States. The latest report contained real estate data through the end of January 2013. Eighteen Florida cities were included in the report. According to the latest numbers, median list prices are either stable or rising in all Florida metros except Tallahassee.
Metro areas with the largest year-over-year increases in median list price included:
- Orlando: +12.8%
- Punta Gorda: +11.17%
- Fort Lauderdale: +8.81%
- Fort Myers-Cape Coral: +8.69%
- Jacksonville: +8.11%
- Miami: +7.34%
- West Palm Beach-Boca Raton: +7.02%
In addition to list prices, the median sales price (the amount that is actually paid for properties) is also rising across much of Florida. Statewide, the median sales price for single-family homes climbed 12.4% in January, compared to the same month last year.
The latest release of the S&P/Case-Shiller Home Price Index also showed positive year-over-year trends for major Florida real estate markets. According to the widely cited report, home prices in Tampa rose 7.2% between December 2011 and December 2012. In Miami, prices rose 10.6% during the same 12-month period.
Real Estate Inventory Down Across the State
Inventory is the other big story here. According to Realtor.com, for-sale inventory has declined in all major Florida cities over the last 12 months. With all other things being equal, this puts upward pressure on home prices.
The largest inventory declines occurred in these areas:
- Jacksonville: -24%
- Orlando: -22%
- Tampa-St. Petersburg-Clearwater: -19%
- West Palm Beach-Boca Raton: -19%
- Sarasota: -18%
Local real estate markets will likely continue to shrink over the coming months. This would come at a time when housing demand is rising, putting even more upward pressure on home prices.
Foreclosures Still a Problem
Foreclosures are still a dark cloud over the Sunshine State. Florida now has the highest foreclosure rate in the country, passing Nevada for the first time in years. According to a recent report, 1 in 32 Florida households had notices of default, auctions or repossessions in 2012 — twice the national average.
As a judicial foreclosure state, Florida also has a lengthy processing time for foreclosures. On average, it takes more than two years for a home to complete the entire process.
The question is, will housing demand remain strong enough to offset the high foreclosure rate? That remains to be be seen. But if current real estate pricing trends are any indication, the state’s recovery could continue in spite of the foreclosure issue.