Florida’s Hot Housing Markets in 2024: 4 Key Locations to Watch
Prospective homebuyers looking to make a purchase in Florida in 2024 can anticipate fierce competition, a trend that is nothing new for the Sunshine State. Florida consistently features cities on the list of the country’s most competitive and expensive housing markets, largely driven by an influx of new residents, a pattern expected to persist in the coming year. Florida has held the distinction of being the most popular state to relocate to for two consecutive years, with numerous cities ranking among the top destinations for newcomers.
This influx of residents contributes to the challenge faced by homebuyers. Increased population leads to a surge in potential buyers, intensifying the competition and subsequently driving up home prices. Florida is also home to half of the nation’s most overpriced housing markets, according to an analysis by Florida Atlantic University, which compared average home values to average list prices in the 100 largest U.S. metro areas. The Florida cities included in the top 10 list were Cape Coral, Lakeland, Palm Bay, Deltona, and Tampa.
Despite these hurdles, there is a glimmer of hope in the form of growing inventory. In September 2023, Florida witnessed a 3.4% increase in available homes for sale compared to the previous year, totaling 143,865 homes, with 41,113 newly listed properties representing a 12% increase.
The trajectory of the Florida housing market in 2024 hinges on several factors, such as inventory levels and mortgage rates. While some experts anticipate a slight decrease in mortgage rates during the first half of the year, they will likely remain elevated. As inflation subsides and unemployment rates rise, the Federal Reserve is expected to gradually reduce rates in 2024. Despite this, rates will likely remain high enough to challenge buyers in terms of affordability, and sellers may be hesitant to give up their existing low rates.
Jeff Polashuk, Regional Vice President of Compass Florida, projects that mortgage rates will likely hover around 8%, which could contribute to increased inventory and provide buyers with more options. South Florida is still considered a highly desirable place to live, thanks to its favorable tax environment, job opportunities, entertainment options, accessibility, and year-round pleasant weather.
Cities that could experience a drop in home prices are those that attracted remote workers during the COVID-19 pandemic. The return to the office for many individuals is expected to prompt them to seek homes closer to their workplaces and more conducive to their lifestyles.
For those considering a home purchase in Florida in 2024, here are four markets worth keeping an eye on:
Jupiter: Known for its family-friendly atmosphere, excellent schools, beautiful beaches, and various entertainment opportunities, Jupiter is expected to see significant growth in the coming years.
Jacksonville: Ranking No. 6 on Zillow’s list of the hottest real estate markets in 2023, Jacksonville offers affordable median home values and has experienced steady population growth in recent years.
Miami: Despite not being known for affordability, Miami’s median home value is projected to remain steady rather than experiencing a significant spike.
West Palm Beach: This city is expected to maintain steady home prices due to ongoing infrastructure development and increased inventory resulting from new construction.