- Florida’s real estate market in August experienced a year-over-year increase in median sales prices for single-family existing homes and condo-townhouses.
- The median sales price for single-family homes rose to $415,000, a 2 percent increase compared to the previous year, while condo-townhouse units saw a 6.2 percent increase to a median price of $324,000.
- Despite the rise in prices, overall sales have slowed, with closed sales of existing single-family homes down 7.9 percent from August 2022, and existing condo-townhouse sales down 7.2 percent year-over-year, due in part to higher mortgage rates and limited inventory have contributed to the slowdown in sales.
Florida’s real estate market in August saw a rise in median sales prices year-over-year for single-family existing homes and condo-townhouses, though overall sales have slowed.
The state’s median sales price for single-family homes climbed to $415,000 last month, up 2 percent compared to the year prior, while the median price for condo-townhouse units was $324,000, up 6.2 percent over the past twelve months.
“These elevated levels of home prices continue to offset the impact of lower levels of sales when it comes to dollar volume, which is calculated as the total combined sale value of all home transactions closing each month,” said Florida Realtors Chief Economist Dr. Brad O’Connor. “August’s dollar volume of closed existing single-family home sales in Florida was about $13.2 billion. That’s down 4.4% compared to last August; however, dollar volume has been much closer to 2021 and 2022 levels so far this year, compared to before the pandemic in 2019.
Last month, closed sales of existing single-family homes statewide totaled 22,917, down 7.9 percent from August 2022, while existing condo-townhouse sales totaled 9,279, down 7.2 percent from the same time a year ago.
Year to date through August, single-family dollar volume in Florida was recorded at $104 billion, compared to about $69 billion during the same eight-month period in 2019. In the townhouse and condo category, dollar volume was actually up year-over-year in August, rising by 2.8 percent to $4.1 billion.
“Persistently higher mortgage rates and a restricted for-sale inventory are hampering sales activity,” said Florida Realtors President G. Mike McGraw in a prepared statement. “However, as our housing prices continue to stabilize and interest rates hopefully moderate, we expect conditions to return to a more balanced market with more options for buyers and sellers.”
Economists pointed to a stagnant mortgage interest rate as a mitigating factor in slowing total sales. This week, the Federal Reserve decided not to raise interest rates, marking the second time this year that rates remained unchanged.
“Mortgage interest rates continue to be the most dominant factor in sales trends here in Florida as well as the rest of the U.S., so the continued year-over-year declines we’re seeing in closed sales are not surprising,” said O’Connor. “This summer, the average 30-year fixed mortgage rate was in the neighborhood of 7 percent, compared to between 5 and 5.5 percent last summer.”
Over the past 17 months, the Fed has been increasing rates to combat inflation but is now taking a pause to assess the impact of previous rate hikes before making further decisions. The current federal funds rate, the highest in over two decades, remains between 5.25 percent and 5.5 percent, with expectations of another rate hike before the end of 2023.