It was a wild real estate ride in 2021. Here are the five biggest trends that shaped the past year
The real estate market in Florida was nothing short of crazy in 2021. Buyers watched as homes flew off the market in a matter of days and prices shot up with double digit percentage increases compared to the year before. Bidding wars erupted, with buyers offering thousands over asking price, sometimes paying cash to entice sellers. Out-of-state buyers heated up the Florida real estate market as they fled pandemic restrictions, and took advantage of remote work that allowed greater flexibility. [Source: South Florida Sun-Sentinel]
Real estate agents make the same regardless of experience. Is that right?
Why is it that rookie agents who just received their licenses are able to charge the same fees as their colleagues — many of whom have decades of experience and have closed hundreds of deals? Why is it that agents who bust their butts — not to mention, spend a ton of money — to market a property for sale are paid the same as glorified chauffeur-agents who do little more than drive you from house to house until you find one that titillates your heartstrings? [Source: Miami Herald]
Inflation ripples to home insurance as replacement values drive up costs
Embattled by years of property insurance rate increases, Florida homeowners are about to get hit by a double whammy: Your insurance costs will likely rise even higher than you expected next year as companies increase the replacement value, or the estimated cost of replacing a damaged home, to reflect skyrocketing costs of construction materials and labor. And those higher values will be multiplied by higher rates approved by state regulators over recent years in response to increased claims costs and related litigation. [Source: South Florida Sun-Sentinel]
Commercial Real Estate Alliance optimistic for 2022
The year 2021 saw massive rises in prices on residential and commercial real estate as out-of-state buyers rushed to Florida. But as the new year comes, wonder remains how long the rush will last— and how it will ultimately end. Ben Bakker, a Realtor at Michael Saunders & Company and 2022 president of the Realtor Association of Sarasota and Manatee’s Commercial Real Estate Alliance, doesn’t expect the market to slow down soon. “We will still see a relatively strong 2022,” he says. “The multiple factors created this fortunate and positive perfect storm for the commercial and residential market, and we still haven’t finished going through those.” [Source: SRQ Magazine]
Miami saw the birth of a real estate crowdfunding business in May. Since then, the female financier and entrepreneur behind it have introduced hundreds of investors to an array of property investment opportunities in South Florida. School of Whales’ co-founder and CEO Andrea Petersen, 37, started her financial technology and commercial real estate investment fund with Daniel Pena-Giraldi, 45, the chief operating officer. She brings her finance background, and Pena-Giraldi draws from his real estate experience, particularly directing Miami’s construction and development company Stambul. [Source: Miami Herald]
› Orlando homebuyers struggled in 2021 in one of the hottest markets on record [Orlando Sentinel]
Anyone looking to buy a home in metro Orlando this year had to bring their A-game and be prepared to fight. In April, the Orlando Regional Realtor Association reported the lowest inventory of homes for sale on record in the area, dating back to 1995 when it began keeping track. Conversely, the median home price broke the threshold of $300,000 in May and set a new record high almost every month afterward.
› After Surfside collapse, a push not just for more high-rise inspections but smarter ones [Miami Herald]
In 2008, the Florida Legislature approved a strict and forward-looking inspection regime for the state’s aging stock of high-rise condos: To uncover defects or deterioration that might threaten their safety and structural integrity, buildings taller than 50 feet would need to be inspected every five years. The rule didn’t last long.
› Home prices rise again in Jacksonville. Where will this end? [WJCT]
It'll cost you 22% more to buy a house in Greater Jacksonville than it did last year, according to new data from the Florida Realtors. Houses on average are selling for at least the listed price, sometimes in a matter of days and often for cash, with few indications that the frenzy is ending.
› Median home prices in Sarasota and Manatee set new record in November as supply tightens [Sarasota Herald-Tribune]
The median home price in Sarasota and Manatee counties again rose to a record level in November, though fewer home sales closed in November 2021 compared to the same month in 2020, according to data compiled by the Realtors Association of Sarasota and Manatee. The data indicates that a trend of low supply and high demand will round out this year with fewer available properties and higher prices.