Home prices fall most since 2011 on Florida’s southwestern coast
AN AREA along Florida’s west coast including affluent Sarasota is seeing the worst home price declines since the aftermath of the Great Recession, as the region recovers from hurricanes and faces rising inventory.
While home prices continue to rise across most of the country, metro areas in once-hot Florida and the South-east dominate the short list of places where they are actually falling from a year ago in data from 226 metro areas compiled by the National Association of Realtors (NAR).
No region is seeing greater declines than Southwest Florida, a fast-growing area historically popular with Midwestern retirees. The Punta Gorda metro area had the biggest quarterly decline since 2011, with the median price falling 6.5 per cent over the year to US$350,000 in the third quarter, NAR data show. Fifty miles north, prices in the North Port-Sarasota-Bradenton area fell 5.8 per cent over the year to US$485,000, also the biggest decline since 2011.
And in the nearby Cape Coral-Fort Myers area, prices fell 3.7 per cent, although it saw a bigger drop earlier this year.
Prices in the South-east are under pressure from “more inventory, higher insurance costs, and more homebuilding in recent years”, NAR chief economist Lawrence Yun said on Thursday (Nov 7).
Tony Barrett, president of the Realtor Association of Sarasota and Manatee, chalked up the recent weakness in part to the effects of recent hurricanes, which delayed some sales and hurt buyers’ confidence. Meantime, the supply of homes has been rising, and fewer investors appear to be buying, he said in a September market report. Finally, the region has been coping with a surge in home insurance costs that has scared off some buyers.
Southwest Florida has been ravaged by storms lately, coping with flooding from Hurricane Debby in August and hurricanes Helene and Milton this fall. The latter storm made landfall just outside Sarasota, taking lives and destroying homes across the state.
Other metros seeing year-over-year drops last quarter were San Antonio-New Braunfels, Texas, and Durham-Chapel Hill, North Carolina. Both areas saw huge annual gains of more than 20 per cent two years ago, NAR data show. Like in many other places where prices are easing, housing remains much more expensive than before the Covid pandemic – and unaffordable for the average household.
Nationwide, the median price for an existing single-family home continued to rise in the third quarter, up 3.1 per cent from a year ago to US$418,700. All said, 87 per cent of US metropolitan areas saw prices rise in the quarter, even if the pace of gains has slowed from a 4.9 per cent annual increase in the second quarter. BLOOMBERG
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