Housing market hitting the brakes? New analysis finds Florida dominates areas slashing home prices

An aerial view shows homes in the sprawling retirement community known as The Villages, Fla., Sept. 15, 2024. (AP Photo/Rebecca Blackwell)

While Memorial Day Weekend is the unofficial beginning of Summer, it’s also the gateway to the traditional robust part of the year for home sales. But this year, sellers are facing challenges in the Sun Belt, especially in Florida.

Realtor.com, a real estate monitoring service, published an analysis this month of housing markets across the country. Researchers concluded that homeowners wanting to sell their properties are “slashing prices to entice buyers.”

Many property owners have dollar signs in their eyes when they first put homes on the market, but researchers concluded that new sellers might get a brutal reality check.

“As inventory builds up, homes sit on the market for longer, pushing sellers to reduce their asking price to drum up some buyer attention,” said Realtor.com senior economic research analyst Hannah Jones.

The shift toward a slowing housing market comes after several years of booming home prices and sales in the wake of the COVID pandemic.

But as the housing market slows, Realtor.com economists now say Florida dominates the markets featuring markdowns on original sale prices.

“Considering Florida’s cooling housing market, which has been due to a combination of oversupply and plunging demand, cities across the Sunshine State accounted for more than half of the U.S. metros with the most price cuts,” analysts concluded.

Most cities across the Sunshine State were part of the price-dropping trend. North Port saw the most price drops, with roughly 30% of listed homes seeing decreases in April. Tampa (29.3%), Cape Coral (28.2%) and Jacksonville (27.6%) were not far behind.

Florida was far from the only Sun Belt area to experience the trend in decreasing home prices.

“Of the 10 housing markets boasting the highest share of marked-down homes for sale, nine are scattered around the balmy region spanning the Southwest to Southeast,” economists said.

Phoenix led the nation in terms of the share of houses on the market with falling prices. In April, about 31% of some 20,000 active listings in that city lowered asking prices before the homes were sold. The median list price in Phoenix was $525,000 in April, and the typical home sat nearly two months on the market before a sale, according to the Realtor.com report.

Florida cities made up most of the rest of the top 10. North Port ranked second in the nation, followed by Tampa, Cape Coral and Jacksonville. Palm Bay was No. 7, followed by Deltona and Austin at eighth and ninth, respectively.

Denver was the only market in the top 10 that wasn’t in the Sun Belt, placing sixth. Charleston, South Carolina, rounded out the top 10.