The Sunshine State has long been a hot destination for real estate – in more ways than one. A safe haven for snowbirds, a point of entry for immigration and a hub for scrappy startups, Florida makes a compelling case for being the premier real estate destination in the United States.
According to the US Census Bureau, Florida is first among states in net domestic and international migration. Coupled with recent technological developments, demographic shifts and financial policy changes, those figures exert significant influence on the Florida real estate markets.
So where does that leave us in 2023? Can Florida homeowners expect to see their investments continue to climb? Can buyers expect a dip in the market to seize their opportunity? And how will technology impact the transaction process? This article takes a closer look.
The Big Picture: Rate Hikes, Inflation and the Near Future of American Real Estate
To understand Florida real estate trends, it’s wise to start with zoomed-out, national macro-trends.
Of course, the news story on everyone’s mind is the recent spate of federal rate hikes. In an attempt to curb recent inflation, the Federal Reserve pushed policy rates to between 5% and 5.25%, causing an overall dip in borrowing – and a blow to real estate markets across the country. While some pundits were optimistic that the hikes would cool, Federal Reserve Chair Jerome Powell recently indicated that we could see more hikes to come.
These hikes exert a clear and appreciable impact on the market. The question is: how long will they last, and will Florida weather the proverbial storm?
Demographic Trends Influencing the Sunshine State
Florida has a lot going for it by way of inflation hedges. As mentioned in the introduction, the state still leads in migration inflow. As more people move in, they will resettle in Florida properties, regardless of swings in interest rates.
Moreover, Florida’s popularity is tied to changing demographics. On one end, the US is witnessing a mass “retirement exodus” of Baby Boomers, many of whom relocate to warmer Southern destinations to live out their golden years.
Next, according to the National Association of Realtors, millennials are now the country’s largest buyers of real estate. Florida’s tech jobs, tax haven status and warm weather could continue to attract both demographics.
The Power of Technology in Florida Real Estate
Lastly, you can’t discount the impact of technology on Florida real estate. While it’s impossible to parse technology’s exact influence on market conditions, a growing tech presence is clearly moving the needle.
According to Nobul CEO Regan McGee, who runs one of the most popular real estate tech companies in North America, “Florida is a wonderful and diverse market” currently benefiting from tech platforms that hand control to consumers. These real estate tech platforms “address an immediate need” for consumer empowerment in Florida real estate. They make the transaction process more convenient, transparent and – crucially – accessible for out-of-staters.
Beware of anyone who says they know precisely how the Florida real estate market will look in one or five years. It’s an ever-evolving market susceptible to demographic, policy, political and technological change. Nevertheless, these insights help demystify those changes, helping real estate consumers stay informed about the road ahead.