The Florida condo market is experiencing some notable shifts, with certain properties seeing drastic price reductions that have erased gains made during the pandemic. However, it’s important to note that these drops aren’t representative of the entire market but are becoming increasingly common.
Pandemic Price Peaks and the Current Decline
In recent months, more listings have appeared on platforms like Zillow and the MLS, showing significant price reductions. In some cases, prices are down by as much as 41% from their pandemic peaks, effectively bringing them back to 2017 levels. These properties, despite the steep discounts, are still sitting on the market, indicating a cooling in demand or a mismatch between buyer expectations and seller pricing.
Is the Condo Market a Buyer’s Opportunity?
For potential buyers, this period presents a curious scenario. Some of these price-reduced listings might seem like good deals, but caution is advised. The ongoing fallout from the HOA crisis suggests that the downturn in condo prices might only be beginning. As a result, prospective buyers may want to tread carefully over the next 6-12 months, as the market could see further declines.
Single-Family Homes Also Affected
The trend isn’t limited to condos. In Punta Gorda, Florida, a single-family home has seen its price drop by 35%, returning to its 2019 value after nearly a year on the market. This suggests that the softening isn’t confined to condos alone but could be affecting broader segments of the real estate market in certain areas.
Anecdotal Evidence of Market Cooling
Frequent scans of Zillow listings across various U.S. cities reveal that this is the first time such significant price drops have been noticed, with reductions of 30% to 40% becoming more common. This shift back to pre-pandemic pricing indicates that the market in some pockets of Florida might be collapsing faster than anticipated.
Overall Market Trends Remain Mixed
Despite these sharp reductions in specific listings, the broader Florida market still shows relatively high prices. Data from Reventure App reveals that year-over-year price declines in various Florida markets are still moderate, with a drop of up to 4.5% in Charlotte County and 2-3% in other areas.
Looking Ahead: Potential for Further Declines
As these outlier listings with substantial price cuts begin to sell and influence 90-day sale comparisons, there is potential for more significant downward pressure on property values in Florida. Buyers and investors should keep a close eye on these trends, as the market could see further adjustments in the coming months.
