Several cities in Florida – including Spring Hill near Tampa, Lehigh Acres near Fort Myers, and homes in Palm City – are listed as some of the best cities to invest in real estate in 2023.
The market was exceptionally good for investors in 2023, but is the Florida housing market still a smart investment for 2023?
Based on the most recent reports from Florida Realtors, the answer is a resounding “Yes!” with tight inventory keeping housing prices high in the state.
Florida indeed has one of the hottest real estate markets in the country, and for a good reason. The state is bordered by the Gulf of Mexico, the Atlantic Ocean, Alabama, and Georgia.
Florida is an international tourist destination with year-round sunshine (earning the state its nickname “The Sunshine State”) with world-class theme parks. The economy is dynamic and diverse, with dozens of global business headquarters and a government that is both pro-business and pro-development.
Read on to learn why the demand for buying and renting real estate in Florida could keep growing in 2023.
Population Growth
Florida has gained more than 2.7 million new residents since 2010, making the state the 3rd most populous after California and Texas. Home to over 21.5 million people, Florida’s population grew by 14.6% compared to one decade earlier. Over the next few years, Florida will gain 845 new residents per day.
Key Population Stats:
- According to the U.S. Census Bureau, in 2020, Florida had a state population of 21,538,187 people.
- Since 2010 the population of Florida has grown by 14.6%, and it is currently the third-largest state by population in the U.S.
- According to U.S. News & World Report, the top 10 fastest-growing places in the U.S. in 2023-2023 are all in Florida, according to U.S. News & World Report.
- The State of Florida expects 845 new residents per day through April 2025, representing an annual compound growth rate of 1.39%.
- The four largest metro areas in Florida are Miami-Fort Lauderdale-West Palm Beach with 6.2 million residents, Tampa-St. Petersburg-Clearwater with 3.1 million, Orlando-Kissimmee-Sanford with 2.5 million, and Jacksonville with just over 1.5 million residents.
Real Estate Market
Home sales and prices are rising, inventory is going down, and the number of buyers paying in cash for single-family homes has increased by almost half, according to November 2023 report. In fact, every metropolitan area in the state has seen home prices increase by double-digits.
Key Market Stats:
- The median home value in Florida is $328,576 (as of Oct. 2023).
- Florida median home values have grown by 23.9% over the past year.
- Over the past five years, home values in Florida have increased by nearly 69%.
- According to the most recent report, single-family home prices in Florida are up 17.7% as of October 2023 compared to the previous year.
- The median time to contract for single-family homes in Florida is just 12 days, which is when it takes to receive a sales contract after being listed.
- At the end of October 2023, active listings for single-family homes were down nearly 30% compared to 1 year ago, with the inventory at a low 1.3 month supply.
Strong Renters’ Market
Some areas see rents jump 24% in a few weeks, and newcomers lead to record rents. The onslaught of in-migration allows landlords to raise rents to lavish levels as people are lured from the Northeast and West Coast by Florida’s thriving job market, lack of state income tax, and sunshine.
Key Market Stats:
- The median rent for a 3-bedroom home in metro Miami is $3,800 per month, while Tampa and Orlando have median monthly rents of $2,250 and $2,150, respectively (as of December 2023).
- Rents in these 3 largest metropolitan areas in Florida have increased between 25% and 31% year-over-year.
- 34% of the housing units in Florida are occupied by renters, indicating that there may be plenty of room left for growth in the rental market.
- Single-family homes make up 60% of the housing units in Florida.
- The median household income in Florida is $59,227 and per capita income is $32,887.
Historic Price Changes & Affordability
The most recent Index shows that home prices in Florida have increased by more than 156% since October of 2000. Over the last 5 years, the price of a home in Florida has grown by nearly 66%, while over the last month, prices have increased by 1.8% (October 2023).
When compiling housing affordability data for Florida, researchers compare median housing prices to median family incomes and mortgage interest rates in the state.
Florida is ranked #31 in affordability, meaning that Florida has one of the least affordable housing markets among all 50 states. By comparison, high-cost states such as Massachusetts, California, and Hawaii were ranked 48th, 49th, and 50th.
Quality Of Life
There are countless reasons why people choose to live and work in Florida. The state offers an ideal work-life balance with great job opportunities and near-perfect weather, culture, and recreation.
Key Quality of Life Stats:
- Florida is one of just 8 states without a personal state-level income tax.
- U.S. News & World Report ranks Florida as the 10th-best state in the country, including top-ten ratings for education, economy, and fiscal stability.
- The climate in the Sunshine State has annual summer highs of 81 degrees and winter lows of around 60 degrees.
- Florida is committed to education, with all Florida residents living within 50 miles of a community or state college or university.
- Living in Florida is about 2% below the national average.
- Florida has more than 1,300 golf courses, hundreds of miles of white sand beaches, countless outdoor recreation activities, world-class theme parks, international shopping venues, and plenty of sporting events.
- Florida has three NFL teams: Jacksonville Jaguars, Miami Dolphins, and Tampa Bay Buccaneers; two MLB teams: Miami Marlins, Tampa Bay Rays; two NBA teams: Miami Heat and Orlando Magic, and two NHL teams: Florida Panthers and Tampa Bay Lightning, and is a major destination for baseball spring training.
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