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Increasingly violent hurricane seasons and surging home insurance costs have tanked Florida’s housing market, according to a Redfin market report published on Tuesday.
Florida led the way in annual pending home sale declines during the four weeks ending on Nov. 10, with contract signings in Ft. Lauderdale (-15.2 percent), Miami (-14 percent) and West Palm Beach (-13.8 percent) declining by double digits. Jacksonville (-9.5 percent) and Tampa (-7.2 percent) fared better than their counterparts; however, those metros still fell behind the national pending home sales growth rate of 4.7 percent.
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Redfin said the dip in buyer activity can be traced back to the impact of hurricanes Helene and Milton, which hit the state back-to-back at the end of September and the beginning of October. The National Flood Insurance Program released a damage estimate report on Thursday, which said Floridians are facing property damage losses of at least $500 million. The melee of storms has sparked a domino effect, leaving homeowners to shoulder exorbitant home insurance costs or sell their homes at a loss.
Outside of climate-related headwinds, weak affordability, rising property taxes and steep homeowners association fees are stifling market activity.
“There’s still some demand for vacation homes, but in general, the market is very slow,” Florida-based Redfin Premier agent Lindsay Garcia said in a prepared statement. “Buyers have been grappling with persistently high housing costs and uncertainty around the election. First-time buyers are especially skittish.”
“The condo market is really struggling because of high HOA fees and homeowner’s insurance costs, and on top of that, many condo owners are seeing special assessments due to new rules implemented after the Surfside condo collapse,” she added. “Some condos are sitting on the market for over a year.”
Although pending home sales in Florida are currently looking bleak, Redfin said there’s still a sliver of hope. In Tampa, pending home sales fell 32.2 percent during the four weeks ending Oct. 20, but now they’re only down 7.2 percent — equaling a 77 percent improvement over four weeks.
