Home prices in Northeast Florida have reached levels never seen before, with properties overpriced by almost a third, new data shows.
Rising prices and a short supply of homes left many potential buyers frustrated as 2021 set records for prices and the short time homes sat on the market. Sellers watched their properties go in a flash, often for more than the listed prices.
While prices are starting to level off in the western U.S., homes are 30.31% overvalued in the Jacksonville market based on historical trends, according to a new study by researchers at Florida Atlantic University and Florida International University.
Lakeland and Tampa areas are even worse, at 40.58% and 39.94% overpriced. But Jacksonville has grown increasingly overpriced since July 2018, the last time that homes were actually a bargain, the study shows.
The COVID-19 pandemic is one major reason. Many people invested in properties where they were spending more time, and others sought new, bigger places to live, sometimes with space to work at home.
Prices were 3% above the expected level when the pandemic hit in March 2020. A year later, they were 11.16% overpriced, and they have continued to rise since.
The median price for a single-family home in Northeast Florida rose to $350,000 in December, up only a bit from November but 22% higher than the year before, the Northeast Florida Association of Realtors reported Thursday.
Meanwhile, the number of homes on the market hit a record low of 3,400, which is just over a one-month supply at current sales levels. That's 25.9% lower than December 2020, the Realtors association said.
Whether the situation will continue is known, the Realtors said. The comparatively tiny increase in prices in December could be an indication that the market is cooling, and the Realtors group expects more homes to hit the market early in the year.
Even so, Florida and other eastern states will fall behind markets in the West, according to the researchers at FAU and FIU.
“Few cities in the eastern half of the U.S. are exhibiting a pricing crown” — the leveling off that typically precedes a market slowdown, said Eli Beracha of FIU’s Hollo School of Real Estate. “Why varying results are developing between housing markets in the West and East is unclear at this time. What is clear, however, is that this pattern is taking hold.”
In individual Northeast Florida counties:
Clay County: The median sales prices of a single-family home was $331,000 in December, 27.8% higher than the year before, according to the Realtors association. The median time on the market was 22 days. Just over 30% of homes sold at more than the listing price.
Duval County: $319,920 median price, a 25.5% increase; 22 days on the market; 34.3% sold over the listing price.
Nassau County: $380,995 median price, a 26.8% increase; 23 days on the market; 25% sold over the listing price.
Putnam County: $198,495 median price; 41 days on the market; 8.1% sold over the listing price.
St. Johns County: $490,250 median price, a 24.1% increase; 28 days on the market; 29.9% sold over the listing price.
