Florida Housing Market Cooling Off: Overpriced Rent and Declining Home Prices Ahead

The housing market in Florida is facing some challenges, with two metro areas in the state being ranked among the top five in the country where home prices are at risk of decline. According to a report from CoreLogic, the North Port-Sarasota-Bradenton and Lakeland-Winter Haven metro areas are among the most overvalued markets in the United States.

The report, which analyzed data from over 40 years, including repeat-sales transaction data, found that these two Florida markets have above a 70% chance of a price decline over the next 12 months. This has given them a 50% to 75% confidence score, indicating a high risk of home price decline.

Despite a nationwide increase in home prices year over year, economists predict a slowdown in price growth in the coming months. The report notes that Northeastern states and Southeastern metro areas have seen larger home price gains as workers move back to job centers and seek more affordable places to live.

Miami had the largest gain in home prices year over year at 11.8%, while states like Maine, New Jersey, and Indiana saw significant increases as well. However, the overall trend is towards deceleration in home price growth, with mortgage rates and high home prices putting pressure on potential buyers.

Chief Economist for CoreLogic, Selma Hepp, noted that recent increases in mortgage rates and high home prices are cooling the housing market, with monthly price gains starting to taper off. Despite this, the report provides valuable insights into the current state of the housing market and the potential risks facing certain metro areas.

For more information, the full report is available on CoreLogic’s website.