In 2008, Fla. had too many new homes; but in early 2020, there were too few. Even if buyer demand falls slightly, a still-low supply will likely push home prices higher.
NEW YORK – Housing prices aren’t expected to drop significantly during the COVID-19 pandemic, in part because Florida is facing a statewide housing shortage.
Florida Realtors says that builders have been cautious since the last recession. Florida Realtors chief economist Brad O’Connor says new home sales are down 30% to 40% statewide, but he says there’s a key difference between the housing market of today and the one 10 years ago.
“When we went into the great recession, builders. … all across the United States had massively overbuilt homes,” O’Connor says. However, builders learned their lesson a little too well, and now the state now has a shortage of housing.
“So let’s say the demand for housing falls, houses will still be scarce … So the prices won’t fall as much as they did last time when there were so many houses to choose from,” O’Connor explains. “We haven’t seen a bunch of people leaving their houses on the market and selling for a lower price. What they’re doing is pulling their houses off the market for a couple of months and waiting for all this craziness to go away, and then they will try to put their homes back on the market and sell for a similar value to what they have it posted for now.”
In Tallahassee, local real estate agent Hettie Spooner says there’s not enough housing under $300,000. She has seen people pull their houses off the market during the COVID-19 pandemic, but she believes it’s a temporary trend, noting that Tallahassee has a steady draw from its government offices and universities.
O’Connor agrees that the COVID-19 pandemic will have an impact on the housing market across the state – but that it will pass eventually.
Source: WUSF News (05/02/20) Gaffney, Robbie
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