Positive Signs for the Florida Housing Market

Positive Signs for the Florida Housing Market

In the wake of the economic recession that has affected the United States since December 2007, it seemed as if hope was lost for investors and homeowners in the State of Florida. Declining property values, increased foreclosures, and a large inventory of property seemed to plague The Sunshine State and it was difficult for many economists to paint a clear picture as to when the economy would start to rebound.

Though there have been signs of crests and troughs over the past four years, many economists believe that we are past the worst of the recession. This is good news to everyone across the United States, but those in Florida, those who have been so strongly affected, are seeing signs that the housing market is turning around.

According to an article from the Florida Realtors, January of 2012 delivered some very encouraging results for homeowners, home buyers, realtors, and investors. According to the article,  “Florida’s housing market reported gains in median sales prices and a reduced inventory of homes for sale in January” (Florida Realtors). This brings an even brighter ray of sunshine to the Sunshine State, because it means that more people are buying homes or condos, which suggests that the housing market is growing stronger. Florida Realtors President, Summer Greene, said that for “statewide single-family and condo-townhome markets, pending sales are higher and the statewide median sales price rose – up 5.3 percent to $129,000 for single-family homes and up 18.8 percent to $95,000 for condo-townhomes” (Florida Realtors). The rising price in median sales, coupled with the fact that pending sales are higher, and that fewer homes are available on the market, demonstrate that Florida’s housing market is improving and that “the availability of affordable financing to qualified buyers and investors [will] continue to stabilize Florida’s housing market and economy” (Florida Realtors).

This is a breath of fresh air for Florida, because the national median sales price for existing single-family homes saw a 2.5% decline from prior year in December 2011. The results suggest that Florida’s housing market is rebounding faster than many other states in the U.S.

Comparatively, the number of closed sales to pending sales is down from prior year in the state of Florida, but this is attributed to the difficulty it takes to secure financing. When we were experiencing the worst of the economic recession, pending sales were down, simply because people could not obtain the required financing for real estate. However, with the shift in momentum, lenders are loosening their grips and more people are able to afford their dream home.

The article by Florida Realtors also states that, according to Freddie Mac, “the interest rate for a 30-year fixed-rate mortgage averaged 3.92 percent in January 2012, down from the 4.76 percent average during the same month a year earlier” (Florida Realtors).

So what does this all mean for a state that was so drastically impacted by an economic downturn? The information discovered suggests that Florida’s housing market is becoming stronger and that more people are now able to afford homes and condos (and with better terms from lenders). While we are not entirely out of the woods, we are creeping closer to the stability and prosperity that the Florida economy has shown in the past. The housing market is critical (as in almost any State) to the success and growth of Florida’s economy. Economists refer to this type of climate as a “buyer’s market,” yet the question seems to be, for how much longer?

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