Florida Housing Market Forecast for 2025: Detailed Analysis from HBI

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Over the past year, the Florida real estate market has changed in fundamental ways and is now starting to favor home buyers over sellers.

Homes are staying on the market longer. Inventory is piling up. Sellers are slashing their prices more frequently. And home buyers have more negotiating leverage and bargaining power.

Forecasts for the Florida real estate market suggest that these conditions will persist through the rest of 2024 and into 2025. Home price predictions, meanwhile, point to a slow and gradual increase in house values for most cities stretching into 2025.

Major Supply Gains in Florida Housing Market

Most housing markets across the U.S. have gained inventory over the past year, giving home buyers more options to choose from and greater bargaining power.

But nowhere is this trend more evident than across the state of Florida.

According to an August 2024 report from Realtor.com:

“Housing stock has been on a tear in Florida since early 2022, and especially over the past year. In recent months, the number of homes for sale is up 50% compared with the same time in 2023, and that’s after inventory rose by around 30% the year before.”

In some parts of Florida, housing market inventory has returned to, or even exceeded, pre-pandemic levels. Most other states across the U.S. have not yet reached that threshold.

The following chart shows months of supply for the Florida housing market and for the U.S. as a whole. This metric allows us to track inventory levels within the real estate market. It’s based on the number of homes for sale and the current pace of sales.

As you can see, the state of Florida currently has a lot more housing market inventory when compared to the nation as a whole.

This bodes well for home buyers in the Sunshine State. Florida buyers now have more properties to choose from and more negotiating leverage than they’ve had for some time.

Tampa, Orlando, Jacksonville, Miami

In August, Realtor.com published a housing market update with data for the nation’s 50 largest metropolitan areas. We downloaded their data and sorted it based on the year-over-year change in active property listings.

This revealed which metro-level real estate markets have had the biggest increase in inventory over the past year. Florida metros took four of the top seven spots, with Tampa head and shoulders above the rest.

Here are the top 10 metros for inventory growth from July 2023 to July 2024:

Metro Area	Active Listings (YoY)
Tampa-St. Petersburg-Clearwater, Fla.	94.90%
Orlando-Kissimmee-Sanford, Fla.	78.70%
San Diego-Chula Vista-Carlsbad, Calif.	77.70%
Denver-Aurora-Lakewood, Colo.	75.10%
Seattle-Tacoma-Bellevue, Wash.	73.50%
Jacksonville, Fla.	73.30%
Miami-Fort Lauderdale-Pompano Beach, Fla.	71.60%
Phoenix-Mesa-Chandler, Ariz.	60.90%
San Jose-Sunnyvale-Santa Clara, Calif.	60.70%
Charlotte-Concord-Gastonia, N.C.-S.C.	59.70%

Individual home buyers must decide for themselves if it’s the right time to purchase a home. And a lot of different factors play into that, including financial circumstances, employment, and long-term plans.

But from an inventory and bargaining standpoint, the rest of 2024 will offer a lot of opportunity for home buyers across the state of Florida. With more properties to choose from, buyers could have an easier time finding a home that meets their needs and falls within budget.

Florida Turning Into One Big Buyer’s Market

In many ways, the state of Florida is turning into one big buyer’s market.

The lightning-fast home sales and bidding wars of the pandemic era are long gone, replaced by slower sales and frequent price reductions. It’s a whole new ballgame these days.

Compared to the past two years, the Florida housing market currently has:

• A lot more supply available, with more options for buyers.
• A much slower sales pace, when measured by median days on market.
• A much lower percentage of homes selling above the asking price.
• A higher number of price reductions by sellers with active listings.

These and other metrics show that the Florida real estate market has become a lot more buyer-friendly over the past couple of years. Our prediction is that these conditions will carry into 2025 as well, especially if mortgage rates drop and inventory increases further.

Modest Home-Price Forecast for Most Metros

A recent round of forecasts from Zillow predicted that home prices in Florida will continue to creep upward through this year and into 2025. But we probably won’t see anything resembling the sharp spike in prices that occurred during the pandemic era of 2020 – 2022.

The latest predictions estimate modest year-over-year gains in the 1% – 2.5% range.

Here are Zillow’s home price forecasts for the three biggest Florida metros:

Metro	Median Home Value	1-Year Forecast
Miami-Fort Lauderdale	$490,171	+2.2%
Tampa-St. Petersburg	$381,941	+1.7%
Orlando-Kissimmee	$399,253	+1.1%

Statewide, the median home price in Florida is currently hovering around $400,000 and will probably stay in that range for the foreseeable future.

As you can see in the following chart, Florida home prices are significantly higher today than they were before the pandemic. The statewide median home value rose from around $243,000 in July 2019 to $400,000 in July 2024.

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However, average wages and incomes in Florida have not kept up with rising home prices. That’s partly why the real estate market is now shifting toward buyer’s market conditions.

In short, higher prices have reduced demand among buyers, leading to fewer and slower home sales, along with a significant increase in inventory.

Prediction takeaway: Home values in many Florida cities will probably either hover within their current range or rise modestly between now and summer 2025.

A Good Time to Buy a Home?

After the roller coaster trends of the past few years, a lot of would-be home buyers in the Sunshine State are now wondering the same thing:

Is now a good time to buy a home in Florida? And what about next year?

Potential buyers should consider a wide range of factors before making a home purchase. This includes their current financial situation, budget, lifestyle priorities, and long-term goals.

But from a real estate market perspective, the rest of 2024 and 2025 could be a great time to buy a home in the state of Florida.

We’ve covered some of the main reasons for this already:

• Home buyers currently have plenty of properties to choose from, thanks to the steady inventory gains of the past two years.
• Home buyers have more negotiating power when it comes to the sale price and other terms.
• Florida housing markets have cooled and slowed over the past year, giving buyers more time to evaluate properties and research sale prices.
• A higher percentage of sellers have been reducing their list prices lately, in order to attract offers in a cooling market.
• Mortgage rates recently dropped “to their lowest level in over a year” according to Freddie Mac, with further declines possible later this year.
• Home prices in most Florida housing markets have stabilized, following the ups and downs of the post-pandemic shakeup.

Despite these mostly positive trends, HBI encourages home buyers to research their local markets and perform due diligence to make an informed purchasing decision.

7 More Things Home Buyers Should Know

Compared to most other states, the Florida real estate market stands out as being larger, more complex, and more diverse. It’s actually the largest housing market in the United States, when measured by the number of home sales each year.

Here are some other things you should know about the real estate scene in Florida, if you’re planning to buy a home there in 2024 or 2025.

1. Steady population growth increases housing demand.

Earlier this year, the state’s population crossed the 23 million mark for the first time ever. This was largely due to people relocating from other states.

Steady growth increases the demand for housing, especially in urban and coastal markets. This is partly why the latest forecasts predict continued price growth into 2025.

2. Tax advantages attract buyers from other states.

Florida is one of the few states with no state income tax. This can be a significant draw for home buyers, especially those who are moving from high-tax states.

A favorable tax climate, combined with a homestead exemption up to $50,000, makes the Florida housing market more attractive for both retirees and working professionals.

3. Coastal and inland housing markets can be very different.

Here’s a key distinction when it comes to property types and market conditions:

• The inland areas offer mostly detached single-family homes and more stable conditions.
• The coastal areas are dominated by the condominium market and often experience more volatility in terms of prices.

The condo-heavy coastal real estate scene can experience extreme fluctuations in terms of inventory, price reductions, etc. In contrast, inland housing markets like Orlando and Gainesville tend to have more moderate ups and downs with pricing and inventory.

Another way to think of it: Florida is not just one big real estate scene, but a patchwork of individual “micro markets” that have very different supply-and-demand factors.

4. Home insurance can be hard to find in Florida.

Florida is facing a severe home insurance crisis. After years of costly hurricanes and other natural disasters, many insurance companies have either reduced the number of policies they issue or left the state entirely.

As a result, homeowners in Florida now face skyrocketing premiums, limited coverage options, and difficulty finding insurance altogether.

Many overlapping factors have contributed to this problem. More frequent severe weather driven by climate change, fraudulent insurance claims, and lawsuits have all worsened the crisis.

This makes the Florida housing market more challenging for both buyers and sellers.

5. Your “neighbors” might be vacationers.

According to the Miami Association of Realtors, Florida has the largest stock of vacation homes of any state in the U.S. They define a vacation home as a “housing unit used for seasonal, recreational, or occasional use.”

Statewide, vacation homes account for more than 8% of total housing stock. But in tourist-heavy areas like South Florida and Orlando, that percentage can be much higher.

6. You might have to compete with investors.

With its favorable tax climate, growing population, and strong rental demand, Florida is a popular real estate market for investors. It’s also a top destination for international buyers, including many from Latin America and Europe.

According to data provided by Florida Realtors, more than 60% of these international buyers paid all cash for properties. All-cash offers are equally common among U.S.-based investors.

This makes the housing market more challenging for traditional home buyers who have to rely on mortgage loans. It’s hard for mortgage-backed buyers to compete with all-cash offers.

But this might be less of a problem through the rest of 2024 and into 2025. Home sales have slowed in Florida and inventory is piling up. Traditional home buyers now have a golden window of opportunity marked by lower competition and higher supply levels.

7. Home prices vary widely depending on location.

The statewide median home value in Florida is currently around $400,000. But prices can vary widely from one city and metro area to the next.

As of summer 2024, the median home value was less than $300,000 in housing markets like Tallahassee and Panama City. In contrast, the median price runs north of $500,000 in cities like Fort Lauderdale and Miami Beach—and more than $1 million in Coral Gables.

Florida home buyers who have some flexibility in terms of where they live could score a bargain by expanding their search zone.

Disclaimer: This report contains predictions for the Florida real estate market extending into 2025. Such views are the equivalent of an educated guess and thus far from certain. The Home Buying Institute (HBI) makes no claims or assurances about future housing trends.