Florida’s House Market Is Struggling to Attract Buyers

Florida homeowners are struggling to offload their properties, according to a recent Redfin study which found that five of the 10 U.S. cities where sellers are cutting prices to attract buyers are in the Sunshine State.

The number of homes for sale on the Gulf coast of Florida is surging, according to the Seattle-based real estate brokerage, leading sellers to slash prices as their properties linger in the market for longer than previously reported while waiting for a buyer. Growing inventory, lower prices and stale listings are taking place in the state at a much faster pace than anywhere else in the country.

Six of the 10 metropolitan areas with the largest rise in supply over the past year are in Florida, the Redfin analysis published last week found. In Cape Coral, inventory surged by 51 percent, followed by North Port-Sarasota (48 percent), Fort Lauderdale (30 percent), Tampa (29 percent), Orlando (23 percent) and West Palm Beach (20 percent).

The other three metropolitan areas with the biggest jumps in the number of homes for sales are in McAllen, Texas (25 percent); Knoxville, Tennessee (23 percent) and Cincinnati (17 percent) in Ohio, another state that, like Florida, has built the most homes in the past few years.

Of the 10 metropolitan areas that experienced the deepest price drops, partly in response to the surge in supply, five are in Florida. In North Port-Sarasota, 48 percent of listings had a price cut—the highest rate in the country, according to Redfin. It was followed by Tampa with 44 percent, Cape Coral with 41 percent, Orlando with 35 percent and Jacksonville with 33 percent.

“Out-of-town homebuyers no longer see Florida as a place to get amazing value. Now they’re moving to North Carolina or Tennessee to get a good deal. Many local blue-collar workers have been priced out of homeownership, too,” Eric Auciello, a Redfin sales manager, said in a press release.

“Two years ago, the North Port metro was one of the most competitive housing markets in the country because it was affordable for remote workers and there was a shortage of homes for sale, but none of those things are true today. Sarasota, in particular, has been overvalued for decades, and the chickens have finally come to roost. The Tampa metro has been faring a bit better.”

Outside of Florida, 43 percent of homes in Indianapolis, Indiana, had a price cut in March, followed by 37 percent in Denver, Colorado, 34 percent in Portland, Oregon, 33 percent in Houston, Texas, and 33 percent in San Antonio, Texas.

North Port-Sarasota was also the metropolitan area where sale prices fell the steepest compared to a year earlier, sliding by 4.6 percent between March 2023 and March 2024. Prices also dropped in two other metros, Oklahoma City, Oklahoma, (1.5 percent) and San Antonio, Texas, (0.3 percent), while at the national level they continued rising. In March, the median U.S. home sale price was 5 percent above the level reported a year earlier, at $420,357.

There are other signs that portions of the Florida market are struggling. Two Florida metropolitan areas—Cape Coral and North Port-Sarasota—also saw an uptick in the median days on the market for properties for sale. In Cape Coral, it took 31 more days to sell a home in March than it took a year earlier; in North Port-Sarasota, 20 more days.

According to Redfin, there are several reasons why homeowners in several Florida cities are struggling to sell. Competition has increased, especially as builders put more new homes on the market, and sellers might be pricing their properties too high, more than buyers may be willing or can afford to pay.

“The sharp ascent in Florida housing prices in recent years has driven a lot of homeowners to cash in on their equity, but some of them are having a hard time adjusting to the fact that it’s a buyer’s market,” Auciello said.

“My advice to sellers is to price your home fairly; the comps from six months ago don’t exist now. And if you’re a buyer, know that the odds of getting an offer accepted below market value are pretty high.”

The ongoing homeowners insurance crisis in Florida is also contributing to the sluggishness of the state’s market.

“We’re seeing sellers offer a lot of concessions to hold deals together,” said Auciello, whose own home insurance surged from around $8,000 a year two years ago to $14,000 a year now.

“We’re at an inflection point. A hefty insurance bill isn’t always a big deal for a luxury buyer, but it can be a really big issue for someone buying a waterfront home on a smaller budget.”