Moving to Florida? You will pay more than the locals to buy a house
TAMPA, Fla. (WFLA) – Four Florida cities show that if you move here from out of state or city, you’ll pay more for your home than locals. Real estate firm Redfin surveyed home buying costs in 49 cities across the United States
For the largest cities, the buyers already there spent much less for their new housing than their migrant neighbors, sometimes almost 30% less. The price differences reported by Redfin were based on average maximum budgets for those moving to their new towns and premises, as well as median sales prices in December.
Of the 49 cities studied by Redfin, only seven had lower prices for those moving in. The city with the smallest price difference between foreigners and locals was Fremont, California, where those from outside spent 6.1% less. than those who already live in the city.
The Redfin study said “movers have more to spend on homes than residents in 42 of the 49 cities included in this analysis.” The company said buyer prices are less of a concern for those moving to areas like Nashville from the West Coast, such as in California.
“People moving from the west coast will pay way more than the asking price without batting an eyelid. In their eyes, they are getting a deal. It’s really hard for locals to compete at the moment, and it can be devastating for first-time buyers who aren’t able to offset high prices by selling a home before buying a new one,” according to a Redfin agent in Nashville.
The city with the biggest gap was Nashville, Tennessee, where residents paid 28.5% less for their new homes than those moving from out of town or state. Philadelphia, NJ was not far behind with 28.4% higher prices for newcomers. New York and Atlanta were also close behind, but Miami reached fifth place.
For the four Florida cities that made the list, price differences reached 25.1% in Miami and 1.7% in Jacksonville. Orlando and Tampa were in the middle of the pack, but there was still a gap between prices 17.1% higher for movers from outside O-Town and 9.2% higher for movers from within. outside the city of Tampa. While the maximum budget differentials were larger in places like Miami, the actual budget dollars were high for both groups in Tampa, where the price difference was smaller.
For Tampa homebuyers, local or out, the median selling price of a home was $339,000 according to Redfin, but budgets were over $100,000 higher. Out-of-town buyers would have budgeted around $575,400 while locals would have budgeted around $527,000.
Since February 10, mortgage interest rates have been rising ahead of an expected rate hike by the Federal Reserve in March. Currently, 15-year fixed-rate mortgages are approaching 3%, while 30-year fixed-rate mortgages are almost at 3.7%, according to Freddie Mac, one of the two federally backed mortgages.
Prices and interest rates could have an effect on the number of people willing or able to buy homes, in addition to ongoing inventory issues across the United States. In Florida markets, Realtor.com reports an increase in sales as price growth continues for the most part. Locations.
|Subway station||Sales growth in 2022||Price growth in 2022|
|Cape Coral-Fort Myers, Florida.||-5.6%||2.7%|
|Deltona-Daytona Beach-Ormond Beach, Florida.||0.6%||6.1%|
|Lakeland-Winter Haven, Florida.||6.5%||seven%|
|Miami-Fort Lauderdale-West Palm Beach, Florida.||3.6%||5.8%|
|North Port-Sarasota-Bradenton, Florida.||0.8%||1.7%|
|Palm Bay-Melbourne-Titusville, Florida.||7.4%||7.9%|
|Tampa-St. Petersburg-Clearwater, Florida.||9.6%||6.8%|
With the exception of the Tampa and Orlando markets, all Florida regions are experiencing price growth that outpaces sales. Questions of affordability and location of construction to meet urgent housing needs continue in the legislature, and the city of St. Petersburg has released the results of a study on the housing needs of its residents.
The march of inflation, including housing costs that are rising more than the rest of the country, puts Tampa Bay’s housing and migration viability at the top of affordability concerns. The metropolitan area’s inflation rate was more than two points higher than the national rate according to the latest data from the Bureau of Labor Statistics. Increases in rents and mortgages more than doubled in the rest of the country, compared to the previous year.
The cost problem is exacerbated by the cost of building materials which is also increasing due to inflation. The latest producer price index showed softwood lumber prices rose 25.4% from December to January, a 20% increase from a year earlier. While hardwoods haven’t risen as much month over month, hardwood prices are up 31% over the past year.
More importantly, fabricated structural metal, used for the construction of homes and offices, saw a price increase of 42.5% from January 2021 to January 2022. Air conditioning and refrigeration equipment increased by 18, 7% over the same period, while ferrous wire products, used for the construction of bridges and skyscrapers, saw a price increase of nearly 30%.
In other words, building is becoming more and more expensive. Whether it’s homes, offices, bridges or roads, material costs are rising. While federal and state governments must strive to invest in infrastructure development, and some say the size of the investment is historic, as material costs rise, the impact of those dollars is reduced by the reduction in purchasing power.
Concerns about the effects of inflation on construction also come from the Associated General Contractors of America, an association of builders. In a new report, the organization said material prices have collectively risen 20% over the past year, compounding problems with addressing inventory shortages for construction and buyers.
“Soaring material prices are making it difficult for most companies to take advantage of any increase in demand for new construction projects,” said Stephen E. Sandherr, the association’s chief executive. “Unabated, these price increases will undermine the economic merits of many development projects and limit the positive impacts of the new infrastructure bill.
The AGCA said the gap between prices for builders and prices for consumers would widen as they pass the costs on to their customers to stay profitable.
The group’s latest construction inflation alert, a report produced to track price changes and their effects on the industry, said the combination of supply chain delays and the “rapid increase in costs” of materials hurts construction labor for residential and non-residential buildings. Fewer people to build would likely add to delays in processing home inventory across the country, as well as infrastructure development more generally.