Condo Meltdown In Florida

Jul 26, 2024

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A few weeks ago we spoke about the surge in residential real estate in parts of Florida. Inventories are up in several markets. But we are also seeing a surge in condos appearing on the market in South Florida. In fact, the condo sale inventory is up 90% in South Florida and the volume of transactions has fallen through the floor. The number of sale transactions was the lowest it has been since 2012 which was at the bottom of the GFC.

We now have 8 months of inventory for condos as compared with last year and the sales statistics for 2024 to date are even lower than 2023.

Naples Florida has 12.5 months of supply in the condo market compared with 3.8 months at the same time last year. Active inventory is up 204%.

Sarasota has 3,600 condos for sale, an increase of 87% compared with the same time last year. Tampa has a 6100 condos for sale. These numbers were not seen since 2011.

The redneck Riviera is also seeing a surge in inventory. Pensacola’s inventory is up 148%. Destin has 11.7 months of inventory.

We’re talking strictly the condo market.

But Florida has a unique situation. If you remember the Surfside condo building that collapsed three years ago killing 98 people, the state of Florida implemented two new sets of regulations aimed at improving the safety of condo buildings. The first regulation instituted mandatory engineering inspections of condo buildings on a prescribed schedule.

The second regulation implements a strict set of guidelines for the condo corporation’s reserve fund.

These two factors are causing condo fees to increase, on top of the rising expenses associated with insurance. This is resulting in special assessments of in many cases tens of thousands.

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