What is driving the market of real estate in Florida in 2023? Let’s talk about the key factors that shape the prices of apartments in Florida.
To start with, it is worth outlining the main trends in the domestic migration of the US population in 2023. Fortunately, in June of this year, a new report was released, revealing which locations in the country are the most attractive for Americans themselves.
Nationwide, 26% of people buying homes between April and June 2023 were looking to relocate to a different area. The top 5 states that homebuyers planned to move to were Florida, Texas, Arizona, South Carolina, and North Carolina. The top 5 states people want to leave today are California, New York, Illinois, Massachusetts, and the District of Columbia (with the country’s capital Washington).
If we look at major cities, Americans wanted to move to Las Vegas, Phoenix, Tampa, Orlando, and Sacramento. Residents were mostly leaving San Francisco, New York, Los Angeles, Washington, DC, and Louisville.
As you can see, two Florida cities, Tampa and Orlando, turned out to be among the country’s most popular metropolises, while the state as a whole is the top destination among those planning to move to another US region. Buying a house or apartment in Florida has become a dream not only for many overseas investors but also for Americans.
Content:
- What affects housing prices?
- Location
- Size
- Development quality
- Neighbourhood infrastructure
- Floor
- Finishes
- Building construction year
- Furnishings
What affects housing prices?
In May–June 2023, the Florida housing market demonstrated the stability of median sales prices: single-family houses in Florida cost as much as they did last year, while prices for apartments and townhouses rose slightly. Although the volume of transactions decreased a little compared to 2022, this trend can be explained by high mortgage rates, which have persisted over the past year. The market seems to be anticipating lower interest rates, as evidenced by the recent actions of the Federal Reserve System. With supply remaining low and demand dependent on mortgage rates, Florida’s housing market will remain stable and continue to grow in the near term, albeit at a slower pace than in the previous two years.
Housing prices are affected by multiple factors, which we will list below.
Location
One of the main factors that determines the price of an apartment or house is the location of the residential property. The buyer must take into account everything: from the prestige of a particular city to the prestige of a neighbourhood in it, from the proximity of the coastline to the proximity of schools, kindergartens, and supermarkets. According to an analysis of home listings, the most expensive properties offered in June 2023 were in the following metro areas of the state:
- Miami-Fort Lauderdale-Pompano Beach
- Key West
- Cape Coral-Fort Myers
- North Port-Sarasota-Bradenton
- Port St. Lucie
- Orlando-Kissimmee-Sanford
- Sebastian-Vero Beach
Size
The area of an apartment is the second most important factor that determines its price, after the location. No wonder the cost of housing is often given per square metre.
Development quality
Development projects in Florida can be both premium and budget-friendly. Depending on which audience the developer is targeting and what amenities it offers, the cost of apartments situated in approximately the same location and having a similar size may differ.
Neighbourhood infrastructure
Even the best beachfront location will be less appealing to buyers or long-term tenants if there are no convenience stores, cafes, or parks within walking distance of the home. The US is a country where owning a car is not a luxury but a necessity. This makes the opportunity to walk close to home or at least not having to drive to the nearest grocery for half an hour all the more valuable.
Floor
In the US, apartments on higher floors, located further from the bustle of the city and providing panoramic views, are traditionally valued more than apartments on the lower floors.
Finishes
Designer finishes using expensive materials or basic plain white walls to save your budget. The price of an apartment changes depending on what you opt for.
Building construction year
As a rule, the newer the building, the more new technologies are used in its construction and the more amenities are available to its residents. Buildings constructed in the last five years offer new energy-saving systems, which allow you to save on utility bills. Therefore, the trend is as follows: the newer the building, the more expensive the apartments in it. Off-plan projects in Florida are in high demand, and buying an apartment in such a project at the initial stage is a great piece of luck for an investor.
Furnishings
Apartments in development projects in Florida are often offered fully furnished. An investor can immediately start renting out such apartments, and they are usually more expensive than unfurnished ones.
