The COVID-19 global pandemic has left its mark in virtually every area of life. The South Florida housing market is no different. People are flocking to South Florida in droves as people have more freedom to live where they want to in the wake of a shift to work-from-home. Additionally, we saw several high net-worth individuals and celebrities flock to Florida as the Sunshine State had much less strict lockdown rules.
Experts are predicting the South Florida real estate resurgence will stick around for the long haul as we see other major cities like Manhattann ad San Francisco deal with long-term re-pricing in the other direction.
Even just last year, it would have been hard to imagine a resurgence of this magnitude in South Florida’s real estate market. During the majority of South Florida’s previous real estate booms, up to 80% of buyers of the most high-end properties were foreign. Post-pandemic, we are seeing those numbers flip to 70% domestic. A figure only amplified by the fact that most foreign buyers are still unable to travel to the United States.
In fact, Palm Beach county is home to the recent purchase of the most expensive home in Florida history, with a price tag of $140 million.
The market is performing at historic levels as average sale prices for single-family homes in Palm Beach county continue to skyrocket 20% year-over-year. Additionally, sales of homes over $3 million have increased for seven consecutive months. What’s more, 17% of all single-family homes (in all price ranges) that closed in January were sold above the listing price.
So, how long will the boom continue? The pandemic will eventually be mitigated, which is likely going to slow down the pace of immigration to the Sunshine State. It also depends on the Tax Reform Act of 2017, and unless it is repelled, the boom is suitable and likely to stick around as long as the underlying tax expense and planning incentives stay at play.
The South Florida real estate boom is great news for the real estate market, as well as the long-term sustainability of the local economy.