Florida Real Estate Housing Market Outlook for 2023
The median price of a home in Florida is around $382,000; this means that the median price of a home in Florida is a bit below the national median home price of $385,000. While this makes property in Florida an excellent investment, the cost of living is also desirable, making Florida the perfect place to invest and live.
While property prices have gone up in the last few years, the Florida housing market shows no signs of slowing down anytime soon. So whether you're looking to invest in a rental property, a vacation home, or move to Florida permanently, now is the best time to invest.
Are you interested in learning about the housing market in Florida? You're in the right place. Here's everything you need to know about the Florida housing market in 2023.
Why Should You Invest In Real Estate?
Real estate is one of the most secure investments you can make. While stocks and bonds can also be relatively safe investments, they have the potential to decrease in value overnight. In this way, investing in real estate is seen as a physical asset that still provides utility even if the price fluctuates over time.
While stocks sometimes give you dividends, you can earn a stable, passive income from real estate, allowing you to create an additional source of income while keeping the principal investment relatively secure. There are also a lot of tax breaks and deductions that can help make investing in a rental property more affordable.
Housing Market Predictions for 2023 in Florida
Economists around the country agree that we are currently in a recession. Economic activity has slowed down around the country, with property prices expected to drop slightly over the next year. However, economists also agree that Florida is entirely exempt from this because Florida property prices have continued to grow even though the general economy has taken a beating. Many attribute this to the fact that people are still flocking to Florida to take advantage of the tax breaks and lower cost of living. In this way, the demand for property in Florida has not slowed down.
Since moving to Florida comes with real financial benefits, many expect the property market to continue to grow in 2023. However, the average cost of a home in the United States is expected to decrease in the next year, meaning that the average property price in Florida will be higher, making it the perfect time to invest in local real estate.
Housing Market in Florida
The Florida housing market has seen a massive growth spike in the last few years because people are moving to Florida at record rates for a better quality of life. While the different cities in Florida can differ significantly in price, the average home in the state is still below the national average at just $382,000.
The average cost of a home in Miami will cost around $442,258. In contrast, the same house in Orlando will only cost $305,622, making it essential to visit a few cities in Florida to see which area is appealing for investment. Cities like Miami and Orlando may be great for vacation homes while Tampa and Jacksonville are better cities to live and raise a family in.
Investment Property in 2023
If you're considering investing in a rental property, looking at the rate of return you can make on your investment before making any significant decisions can be beneficial. Look at the average rental price in that area to calculate this. For example, the average apartment rental in Miami is around $2,227. In contrast, the same apartment in Orlando will only make you approximately $1,181, making Miami a better city to invest in rental property compared to other cities in Florida. However, these prices have been rising for the last few years. People have consistently been moving to Florida, with the pandemic in 2020 speeding things up as well.
Affordability in Florida
As mentioned above, the housing market in Florida is slightly below the national average. However, the most significant savings people can expect from moving to Florida is that the state does not collect personal income tax. So you can save thousands of dollars annually by moving to the Sunshine State.
Florida is one of a few states that generate enough income from the commercial sector that they don't need to collect personal income tax.
While the state does not collect personal income tax, the cost of living in Florida is also relatively cheap. Many expenses are lower than the national average, letting you live a better lifestyle in Florida than in many other parts of the country.
The average cost of living in Florida is around $43,615 per year, which breaks down to approximately $9,255 for housing, $6,675 for health care, $3,693 for food, $580 for gas and energy, and around $23,413 for other personal expenses. The average person spends about $3,635 per month living in Florida.
While these are the averages, many things are incredibly affordable in Florida, including housing, health care, and general day-to-day expenses. However, expenses such as utilities, groceries, and transportation are only 2% to 5% more expensive than in the rest of the country.
The cost of living has been rising around the country, leading to more people moving to more affordable cities, one of the most significant factors driving demand for local real estate in Florida.
Factors Driving Demand for Florida Real Estate
Regarding the national real estate market, no state seems to be doing as well as Florida. Florida has been one of the most prosperous states for a long time, but the current economic climate is driving more people to invest in the local real estate market.
Here are a few reasons why the demand for Florida real estate will likely continue to grow in 2023.
Excellent Weather: It's no surprise that Florida has some of the best weather in the country. More than 200 days of sunshine every year makes Florida the perfect place to be throughout the year. While this does make it a great vacation destination, it also makes it a great place to live and raise a family.
The summers in Florida are pretty humid, but you'll never need more than a simple sweater during winter, making it ideal for those who hate the cold, rain, and snow that typically makes winter unbearable. Average Florida temperatures range from 70 to 80 degrees during winter, with summers reaching around 90 degrees.
Cultural Diversity: Florida is an incredibly diverse state. Florida has many residents from different parts of the world, with many people moving from various parts of the country to Florida. So, you'll be able to hear languages and taste foods from around the world in Florida.
This diversity also showcases the acceptance of different cultures in the state, making people feel at home when they move to Florida. Whether you're coming to visit or moving to the state permanently, Floridians are some of the most friendly and welcoming people in the entire country.
The Vacation Lifestyle: Florida is known to be one of the country's most comfortable and relaxing states. While the state is still incredibly successful in business and trade, travel is its biggest attraction. Florida is home to a few major theme parks, the most popular being Disney World and Universal Studios.
Whether you're having coffee or taking a walk down the road, the lifestyle in Florida is more laid back than the rest of the country, making it the perfect place to relax, unwind, and raise a family.
Different Types of Florida Property
Florida has a few major metropolitan cities and a few smaller towns, making the real estate market in Florida one of the most diverse in the entire country.
Whether you're looking to invest in an apartment, condo, secure estate, or home, Florida has it all. This diversification of real estate helps the local housing market to continue to grow.
Moving To Florida
There are many real estate options if you're considering moving to Florida permanently. Florida is home to gated communities, country club neighborhoods, golfing communities, and secure estates for those who want more convenience and privacy. There are also many retirement villages for those who want to sit back and enjoy retirement in the Florida sun, living a maintenance-free lifestyle.
Cities like Tampa offer a wide range of real estate for those who want to move to Florida. This city is smaller than Miami and is an excellent place to raise a family. Tampa is home to many small businesses, parks, and schools and has everything you'll ever need.
Florida Vacation Homes
While Florida is home to more people than ever, visitors from all over the world are welcome, making it the perfect place to invest in rental property, especially if you plan to rent on a short-term basis. For example, you can buy a property and list it on vacation rental sites to generate an additional source of income.
Florida is also home to thousands of apartments and condos. These apartments, especially in Miami, can allow you to generate thousands of dollars every month in rent. As mentioned above, the average cost of an apartment in Miami is over $2,000, making it one of the best investments.
Some of the Best Places in Florida To Invest In
There are many cities in Florida to invest in real estate. The most popular options are Miami and Tampa, but other places promise even better returns on your investment. So here are the top three choices.
Palms Springs, Florida (Palm Beach County): The average property price in Palms Springs is only $205,262, which is significantly below the state average and makes it the perfect place to invest in Florida. You can expect to generate around $1,414 per month with a rental property resulting in a return of about 8.2% per year on your investment.
Margate, Florida (Broward County): The average property price in Margate is around $225,000. While this is more than property in Palms Springs, it's still below the state and national averages. Rental property in the city can bring in around $1,582 per month, resulting in a return of about 8.5% per year.
Jensen Beach, Florida (Martin County): Jensen Beach is a beautiful town in Florida that comes at a much higher price. The average home in this city is around $671,681. You can expect to collect about $2,763 monthly in rent, resulting in a return of about 5% per year on your initial investment.
Florida Housing Market Predictions for 2023
While the economy is slowing down the real estate market around the country, Florida seems to be the exception. With tons of benefits for all residents in the state, the Florida housing market predictions for 2023 lean toward continued growth.