Florida seemingly continues to operate in its own world—at least when it comes to real estate. While signs indicating slowing momentum are popping up more and more throughout the nation, six of the top 25 overvalued home markets are right in our backyard, and several new studies indicate a prolonged period of unaffordability.
Florida Atlantic University, Florida International University, and the University of Alabama found that the current combination of high demand and low inventory that began at the start of the pandemic is likely to continue thanks in part to future population growth projections.
Which Florida Communities Are The Most Overvalued?
Of the six Sunshine State metro areas identified, Fort Myers topped the list. Typical buyers there are paying approximately 51% more than they should based on historic trends. Lakeland followed, with homes overvalued by 50%. Tampa, Melbourne, Sarasota, and Daytona Beach rounded out the list, with values hanging between 44%-49% over historic price trends.
Closer to home, home prices throughout Miami-Dade, Broward, and Palm Beach counties were surprisingly more realistic; coming in at around 27% over value. However, their ranking is set to rise as areas outside of Florida begin to slow.
With population growth projections showing a 12% increase—or approximately 180,000 new residents—over the next decade for Palm Beach county, chances are the Gold Coast will continue to climb up the ladder.
Will A Housing Crash Affect Florida?
Rising interest rates and a natural decline in demand is starting to take hold of other parts of the country—even those that saw a boom over the past 24 months. However, this does not appear to be the case for Florida, where home prices—and rental costs—continue to climb.
While the demand is obvious, some purchasers may be caught by surprise by unexpected expenses like property tax hikes and home insurance premiums. Even those who have bought previously will be feeling these effects as South Florida’s popularity continues on its rocket-like trajectory.
What's Next For The Florida Real Estate Market?
If you have questions about the state of the current local market and it’s potential future, contact the Palm Beach County real estate experts at The Pearl Antonacci Group today.