According to the U.S. Census Bureau’s latest Economic Indicators, Florida's real estate market has been booming over the past month with a significant increase in new residential sales. In March 2023, sales of new single-family houses were at a seasonally adjusted annual rate of 683,000, a considerable increase of 9.6 percent (+/- 15.2%)* from the revised February 2023 estimate of 623,000.
Mortgage Buydowns
One interesting factor that may have contributed to this surge in sales is the mortgage "buydowns" many home builders offer. Rather than reducing prices, builders are offering incentives to buyers in the form of lower mortgage payments. This has proved to be an attractive option for many buyers and has likely played a role in driving up sales.
Privately-Owned Housing Starts
Additionally, it's worth noting that there has been a slight decrease in privately-owned housing starts in March 2023. With a seasonally adjusted annual rate of 1,420,000, privately-owned housing starts fell 0.8 percent (+/- 13.0%)* below the revised February 2023 estimate of 1,432,000. However, this decrease has not significantly impacted the overall increase in sales.
Population Growth
One factor strongly contributing to Florida's robust real estate market is the state’s population growth, particularly in Central Florida. Hillsborough, Polk, Lake, Osceola, and Orange counties have contributed greatly to this, accounting for almost 30% of the state's growth. Florida is recognized as the fastest-growing state in the nation. This influx of people has driven up demand for housing, resulting in the increase in sales we are seeing.
Final Notes
Commercial real estate analysts and residential development experts have predicted these trends to be very promising for the real estate industry in Florida. The increased population growth, the strong demand for housing, and the attractive incentives offered by builders all suggest that this trend is likely to continue. If you're interested in investing in the Florida real estate market, now may be an opportune time to do so.
If you're interested in learning more about the residential development market in Florida or have any questions about real estate investing, don't hesitate to reach out to a real estate advisor at SVN | Saunders Ralston Dantzler. Our team of commercial real estate experts is here to help you navigate the market and make informed decisions concerning your investments. Contact us today to schedule a consultation and learn more about how we can assist you.