The sharp rise in single-family home prices and acute lack of inventory has led buyers back to the condo market in the US. Recent research reveals that sales have soared by 100% and that prices too are on the up. And nowhere more than in the Sunshine State with Florida condos seeing the highest price hikes in the country.
Return to the condo market
At the start of the pandemic, buyers flocked to the single-family home market, drawn to the more spacious properties and their location in the suburbs. As a result, sales of condos dropped considerably in mid-2020. For example, in May, they fell by 46%.
However, rising prices and a supply shortage in the single-family home sector have refocused buyers’ attention on condos and townhouses. According to figures from Realtor.com, sales surged in May with a 100% increase on the same month in 2020 and the trend shows no sign of losing momentum.
Relocation to Florida
The pandemic has also led many Americans to rethink where they live and Florida has consolidated its position as one of the most desirable states in the US for relocation. As well as year-round sunshine, Florida offers low taxation and affordable housing.
“People from the Northeast are saying, ‘If I’m going to get stuck because of mandatory quarantines, I’d rather have that happen in Florida than in New York,’” said Brad Hunter, from Hunter Housing Economics.
Relocation companies note the high influx of new residents to the Sunshine State, particularly from the Northeast. The numbers could be as high as 1,000 people a day.
Florida condo market on fire
Realtor.com looked closely at the condo market in the US and analysed cities with at least 250 condo listings. The company then ranked the hottest condo markets in the country and Florida took six of the top ten places, with four in the top five.
“The Florida condo market is one fire,” said the report, citing the markets in Dustin, Panama City, Naples, Panama City Beach, North Miami Beach and Delray Beach as the country’s hotspots. All have coastal locations, reinforcing the trend for beach condos in the US.
Top markets in the Sunshine State
Dustin took the top position as the hottest market for Florida condos. In this city, prices soared by 67% in the 12 months to August this year. The metro area has some of the highest prices in the Sunshine State with the median price for condos coming in at almost US$700,000. However, this is less than half the average price for a single-family home in Dustin.
Panama City stood in the second place. In this part of Florida, condo prices saw a hike of 32% in the year to August. In the neighbouring district of Panama City Beach, condos went up by 32%.
Of the six Florida cities in the top ten, the cheapest option for condo properties is Delray Beach. Here, prices have risen by 17% in the year and currently stand at a median of US$192,550.
Trend here to stay
This latest report on Florida condo rises confirms a trend that began earlier this year. Buyers are flocking to the Sunshine State, which ranks as one of the most popular for real estate in the US.
Analysts quoted in the Realtor.com report reiterate the trend. They highlight big-ticket company relocations to Florida such as Goldman Sachs in West Palm Beach and underline the well-paid high-tech positions available in the state.
As a result, they believe Florida is set to continue as a magnet for relocators. “I think Florida is going to be the biggest boom state for at least the next ten years to come,” said a relocator expert.