Housing markets in western Florida are cooling faster than anywhere else in the country as natural disasters intensify, new construction soars and the pandemic-era homebuying demand boom fades further into the rearview mirror, according to a new report from Redfin.
In North Port, Fla., the housing market is cooling fastest, followed by Tampa, Fla., and Cape Coral, Fla. There are three other Florida metros on the list of 10 housing markets cooling quickest: Orlando comes next, followed by Denver, Houston, Minneapolis, Jacksonville, Fla., Lakeland, Fla., and Dallas.
The measures are year-over-year changes in home prices, price drops, inventory, sale-to-list price ratio and the share of homes that sell within two weeks, according to Redfin.
Measures of homebuying demand and competition are dropping off quickly in Florida, and listings and price drops are surging. Take North Port, the nation’s fastest cooling market, as an example. The supply of homes for sale is up 68 percent year-over-year, the second-biggest increase of the metros in Redfin’s analysis.
Meanwhile, the median price per square foot is down 1.2 percent, making North Port one of just four metros where price per square foot declined. The others are Cape Coral, Fla. and San Antonio and Austin, Texas.
Forty-three percent of sellers are dropping their asking price — up from 36 percent a year earlier. In Cape Coral, inventory is up 64 percent, median price per square foot is down 2.9 percent, and 37.5 percent of sellers are dropping their price, up from 32.9 percent a year earlier, Redfin added.
“Inventory is back up to pre-pandemic levels along the west coast of Florida as natural disasters continue to shape the region’s housing market by leading to more supply and less demand,” Redfin Senior Economist Elijah de la Campa said in a release. “Construction is booming in the wake of recent climate disasters, and there’s less demand to buy new homes as the region braces for another intense hurricane season. While that’s disappointing for sellers, who may have to part with their home for less money than they would like, a bigger pool of listings to choose from is good news for the region’s homebuyers. More supply is the best way to bring down prices and combat the housing affordability crisis buyers are facing today — and that’s exactly what's happening in parts of Florida.”
Housing markets in western New York and the Midwest are holding up best, according to Redfin. Rochester, N.Y., takes the number-one spot, followed by Lake County, Ill., and Buffalo, N.Y. Compared with last year, inventory in those metros is down, price per square foot is up by double digits and more homes are selling within two weeks.
Redfin said homebuying demand and competition are heating up in Rochester and Buffalo because although prices are increasing, homes are still much more affordable than they are in most of the country. The typical home sells for roughly $250,000 in both Rochester and Buffalo, compared with $440,000 in the U.S. as a whole and $750,000 in the New York City metro, where many remote workers who moved to upstate New York came from.