Despite Pandemic, Florida’s Housing Market Bounced Back at the End of 2020

Despite the ongoing COVID-19 pandemic and resulting economic challenges, Florida’s housing market wrapped up 2020 with more sales, higher median sale prices and more pending inventory compared to the year before, according to the latest housing data released by Florida Realtors last week.

“For much of 2020, our homes became the hub for our daily lives, with people working remotely, children taking classes online, and many restaurants and entertainment options on lockdown due to the pandemic,” said Florida Realtors President Cheryl Lambert with Only Way Realty Citrus in Inverness. “It’s a testament to Florida’s resilient housing market and ongoing buyer demand that home sales at the end of the year topped 2019’s totals. And with mortgage rates still historically low, buyer interest remains high into 2021 – but record low for-sale inventory levels continue to put upward pressure on prices and availability.”

Statewide closed sales of existing single-family homes totaled 86,543 in the fourth quarter of 2020, up 23.6 percent compared to the year-ago figure, according to data from Florida Realtors research department in partnership with local realtor boards/associations. Closed sales typically occur 30 to 90 days after sales contracts are written.

“Sales of Florida homes in the fourth quarter were very strong compared to a year ago,” said Florida Realtors Chief Economist Dr. Brad O’Connor. “Meanwhile, there’s a constrained supply of inventory (active listings), which we’ve been seeing for some time. That shortage, coupled with the very low mortgage rates that are helping to drive buyer demand, keep pushing home values upward.”

The statewide median sales price for existing single-family homes for 4Q 2020 was $306,000, up 14.6 percent from 4Q 2019. New pending sales for existing single-family homes for the quarter rose 22.2 percent compared to a year ago, while new listings were up 3.5 percent from 4Q 2019.

Looking at Florida’s year-to-year comparison for sales of condo-townhouses, a total of 35,865 units sold statewide in 4Q 2020, up 29.4 percent compared to the same period a year earlier. The statewide median price for condo-townhouse properties for the quarter was $226,000, up 15 percent over the previous year. New pending sales for condo-townhouses for 4Q 2020 increased 30.9 percent compared to a year ago, while new listings were up 5.9 percent from the same quarter the previous year.

Statewide closed sales of existing single-family homes totaled 310,378 at the end of 2020, up 5.8 percent compared to the 2019 figure, according to Florida Realtors data.

O’Connor noted that by the end of the year, the drop-off in Florida’s housing market from February into early May – due to COVID-19 – had not only leveled out, but sales outpaced the previous year in both the single-family homes and condo-townhouse categories.

“We’ve seen a substantial increase in the dollar volume of sales in 2020, due to increasing sales, rising prices and a greater share of our sales being among the luxury tiers this year (2020) vs. 2019,” he said. “For all residential property types, we were up 20.3 percent to over $160 billion (total of $162.3 billion) in dollar volume in sales of existing homes in 2020. Florida totaled $124.6 billion in volume in single-family home sales in 2020, up 22.5 percent from 2019, while condo-townhouse sales reached $36.2 billion in volume, up 13.7 percent from the previous year.”

Looking to 2021, O’Connor said he expects the trends from the end of 2020 to continue.

“I think we will continue to have robust sales growth,” he said. “As we get closer to vaccination really making a dent in the threat from COVID-19, we might see more people starting to consider upgrading or changing to a different home to take advantage of interest rates while they remain in the low to mid-3 percent range – which is what most forecasters currently predict.”

The statewide median sales price for single-family existing homes at year’s end was $290,000, up 9.6 percent from the previous year. New pending sales for existing single-family homes rose 9.2 percent at the end of 2020 compared to the previous year, though new listings for single-family homes dropped (-2.8 percent) from a year ago.

Looking at Florida’s year-to-year comparison for sales of condo-townhouses, a total of 119,336 units sold statewide in 2020, up 2.5 percent over 2019. The statewide median price for condo-townhouse properties at the end of the year was $215,000, up 12 percent from year-end 2019. New pending sales for condo-townhouse units for the end of 2020 increased 6.2 percent compared to a year ago, while new listings for condo-townhouses rose 1.1% from year-end 2019.

At the end of 2020 and also for 4Q 2020, inventory (active listings) for single-family homes stood at a 1.8-months’ supply, while inventory for condo-townhouse properties was at a 4.2-months’ supply, according to Florida Realtors.

The interest rate for a 30-year fixed-rate mortgage averaged 3.11 percent for 2020, down significantly from the previous year’s average of 3.94 percent, according to Freddie Mac.

 

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