Watch for the market to reignite over the next several months. We have weathered the worst of it. Watch for the Florida real estate market to slowly start growing in 2024 as interest rates flatten and consumers begin realizing what they’re seeing is the new normal in prices and interest rates. Florida saw almost $200 billion in closed sales in 2023, which wasn’t far below 2022, a super-strong sales year post-pandemic, that number was substantially higher than in the pre-pandemic year of 2018, according to Florida Realtors data.
Over the next several months, the market could reignite a little bit. Even though there aren’t as many homes for sale, the ones that are for sale are selling for more. Mortgage interest rates have likely peaked, and there’s a good possibility that the Fed could begin cutting rates in the coming months — and that could reinvigorate buyers, a cut to below 6% could be in the forecast with the first relief possibly coming by May. The psychology of buying or selling a home is closely tied to these rates.
People are still saying the real estate market is going to crash. But that’s just not the case, that adjustable-rate mortgages, aren’t as widespread. We have weathered the pandemic with no foreclosure crisis. We are not in a position for a crash to happen. Signs point to a slowdown in economic growth at the national level, but that a full-blown recession isn’t likely. Even so, Florida’s strong economy is well-positioned. I think Florida is prepared to weather any national economic storm.
A few of the factors buffering the Florida real estate market from some national economic trends include: The state’s labor market is strong, Paychecks are still coming in .Florida’s population growth remains strong at about 1,000 new people a day. An increase in population means an increase in economic activity. Retirees with home equity looking to relocate are unfazed by high interest rates. Commercial real estate has a much bumpier road ahead than does residential in 2024. Commercial lending has gotten significantly tighter and is still feeling repercussions of the “work from home” transition.
