Florida Home Price Appreciation Slows
After record-breaking home prices over the last few, the Florida housing market is now facing a major slowdown in price appreciation.
There was an astounding 113 percent spike in the past five years, but experts agree such numbers could never have remained so strong. During this year’s second quarter, home appreciation cooled to a pace of 2.51 percent, according to a study released this week from the Office of Federal Housing Enterprise Oversight.
On the national level, however, the housing market cool-down is freezing by comparison. Therefore, there are still positive signs that Florida home mortgage demand will return and the entire country is simply undergoing a slow period at the moment.
The sluggish 1.17 percent increase natiowide was the slowest quarterly hike since the fourth quarter of 1999 and the sharpest quarter-to-quarter pullback since the government began tracking housing figures in 1975.
Locally, the appreciation rate for Jacksonville homes was modest compared with some of the gaudy numbers in other Florida markets, but it still ranked 31st in the country; over the past year, this market saw houses appreciated at a rate of 18 percent.
Exactly how much appreciation has slowed is open to debate.
“Bricks and mortar do not usually fall in value, especially in Florida,” said Alan Dean, chief executive officer of Davenport-based Florida Homes International. “Appreciation will just be slow for a while, but jumps in appreciation always come back.”
However, Jonathan Miller of Miller Samuel, an appraiser in New York, believes the slowdown may be even more pronounced than the numbers are showing.
“The index may not reflect what’s really happening out there,” Miller said.
He said many sellers are holding out for unrealistically high asking prices, as the only buyers actually purchasing homes are the ones willing to pay those higher prices. Therefore, volume rises and Florida home mortgage loan applications are not sent in until future owners feel better about the prices in the table.
