TAMPA, Fla. (WFLA) — Florida home prices are on the rise, and according to Zillow, more than in pretty much any other place. While home values across the U.S. “remained nearly flat in October” compared to the year before, in Tampa, home values were up more than 21%. Nationally, the values had only risen by 0.1%.

Zillow said the four major markets with the greatest year-over-year home value appreciation were in Florida, being Miami (23.3%), Tampa (21.2%), Orlando (20.9%), and Jacksonville (19.8%).

“Home prices in October remained in suspended animation as more buyers, but especially sellers, took a wait-and-see approach to market conditions,” Skylar Olsen, chief economist at Zillow, said. “Fewer home sales is the hallmark of a housing market lull, but right now potential sellers sensitive to losing their historically low mortgage rates have as much, if not more, of a reason to wait for a robust spring season and hope for mortgage rate relief.”

Zillow said the high mortgages, now up to 6.61% for a 30-year mortgage, had contributed to the buyer hesitation, leaving home inventories on the rise. “The share of income spent on monthly mortgage payments has risen from 27.7% in February to 37.3% in October,” according to the company, it’s “well above a previous peak of 35% in 2006.”

Florida’s home sale numbers continued to drop as well. From October 2021, the number of closed sales across the state fell by almost 25%. Despite the drop, the Tampa market still made up nearly 17% of all sales in the state, continuing a trend of being the hottest housing market for buyers.

Of the 20,837 home sales closed in Florida, 3,484 were in the Tampa-St. Petersburg-Clearwater metro, according to data from Florida Realtors. Meanwhile, prices in the market were up 14.9% compared to the year before, putting the median sale price at $400,000.

Focused on single-family homes, sales are slowing down. In 2021, the number of sales paid in cash was 8,256. In 2022, it fell to 5,908 across the state. Median time to sale also increased, from 53 to 70 days. New sales and new home listings in October fell, 41% and 18%, respectively, Florida Realtors reported.

While the number of new sales and new listings dropped, the number of active listings in Florida’s home inventory rose 88.4%, with 2.7 months worth of supply available, according to the realty data.

For the Tampa area, Zillow said home values had risen significantly since before COVID-19, though the prices themselves had started to go down. The real estate company reported that:

  • The typical home value is $391,409, down 0.1% month over month, but up 72% since October 2019 (third highest in the country)
  • Sales measured by Zillow’s Nowcast are up 12.1% month over month and are down 26% compared to October 2019.
  • New for-sale inventory has risen 1.3% since September (JAX and Tampa are the only metros in the country with increases in monthly inventory; Tampa is No.2). Total inventory is now 28.1% lower than in 2019. 
  • The share of listings with a price cut in October was 34.8%, compared to 35.2% in September.
  • Typical rent is $2,135, up 9.8% year over year.

Similar to the Florida Realtors data, Redfin, another real estate company, reported pending home sales had fallen in October, though they attribute it in part to deal cancellations and price cuts.

“Pending sales dropped 32.1% year over year last month, the largest decline since at least 2013, when Redfin’s records begin,” the company reported. New listings fell 24%, according to the Redfin data, which the company said was also due to surging mortgage rates making would-be sellers pause their moves as a result of what they call a “lock-in effect.”

“The Fed’s actions to curb inflation are causing the housing market to slow at a pace not seen since the financial crisis,” Redfin Economics Research Lead Chen Zhao said. “There are already early but promising signs that inflation is cooling, which caused mortgage rates to drop last week. If that progress continues, buyers who recently backed out of deals may return to the market and sellers may be less inclined to slash their prices.”

Due to the changes, including almost 60,000 home purchase agreements falling through, Redfin said home prices “have room” to come down.

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