Last Updated: April 21, 2021
It’s undoubtedly an excellent time to be a real estate agent in the Sunshine State. The COVID-19 pandemic has become a catalyst for Florida’s real estate market growth during the past year, as properties have been selling like hot cakes, making it difficult for the market to keep up with the demand.
Where there’s a high demand, there are high prices—property values have skyrocketed. Florida’s median home values mark a 7.9% increase during the past year. However, this doesn’t seem to deter buyers whose most popular choices are condos and single-family homes. The sale of the latter increased by 21% compared to a year ago.
The exponential growth is brought on by a few factors. The most obvious are Florida’s all-year-round pleasant weather conditions and opportunities for outdoor activities (which are especially welcome during the pandemic). Other factors include its open economy, no state income tax, stable politics, and, last but not least, a thriving remote work scene.
A Boom in the Midst of the Pandemic
If you’ve been following the latest real estate trends, this wouldn’t come as a surprise. However, although Florida’s (especially South Florida’s) real estate market has enjoyed steady growth over the years, the ongoing pandemic jumpstarted the current real estate boom. People realized the importance of outdoor space once they had to stay in the confines of their own homes for months.
This is especially relevant for those who work from home. Realtors report that the demand for homes with a bigger number of rooms is higher, with many buyers intending to turn some of these rooms into offices. The demand for office space has been steadily dropping each year (most recently at a 26% drop) as more and more people are working remotely.
However, the greatest interest is in condos and single-family homes. 90%-100% of new homes have been occupied or sold, leaving potential home buyers desperate enough to pay upfront for a place that is years away from being built.
The buyers are in the 40–60 year age range, with private equity, hedge funds, or with a large sum of cash available. However, things are also looking up for the young and tech-oriented.
Besides families and individuals, companies are also looking to find a new home in sunny Florida. Florida’s work scene is slowly but surely becoming a hub for tech and cybersecurity companies, as the pandemic highlights some San Francisco and Silicon Valley issues. Wanting to escape the high taxes, ceiling-high housing costs, and strict business regulations, tech companies are looking to find a new home in business-friendly Miami.
Who Can Expect to Profit
It comes as no surprise that the ones who will profit most from this growth spurt are real estate companies. For them, business is booming with no sign of stopping.
If you’re a homeowner in Florida who is looking to sell, this is your lucky year. With the huge demand, you might even get to sell your place for double its value compared to what it would sell for a few years ago.
Finally, tech companies will see a considerably higher profit margin by escaping from the high-tax and high-rent states.