Clear Capital: Boomers Lead Florida Housing Market Revival
Clear Capital, Reno Nev., said while home price growth stabilized in the first quarter, one state–Florida–saw marked improvement, thanks to an aging Baby Boomer population.
The company’s monthly Home Data Index Market Report said quarterly growth remained fixed at 0.6 percent during the first quarter. Regionally, the West continued to dominate at 1.1 percent quarter-over-quarter price increase, a downtick of 0.1 percent from May. Growth rates in the South remained unchanged at 0.7 percent, while Northeast and Midwest regional growth continued to lag far behind the rest of the nation at 0.1 percent growth each.
But if home price growth didn’t show much movement for the country as a whole, the report said Florida’s markets continued to recover from the devastating lows of the housing market crash, with an increase in baby boomers in the region providing key insight into the market’s future.
Seattle and Tampa tied for the top spot on Clear Capital’s Highest Performing Major Metro Markets for June, each reporting a 2.0 percent increase. Three other Florida markets are also reported stronger quarterly gains: quarterly price growth in Orlando rose by 0.2 percent since May to 1.7 percent, while Jacksonville price growth rose by 0.3 percent, also to 1.7 percent. Miami reported 1.4 percent quarterly price growth.
Clear Capital Vice President of Research and Analytics Alex Villacorta said the most recent quarterly growth figures for these Floridian markets fit into a longer-term pattern of growth and recovery for the Sunshine State. He said each of these major MSAs has experienced incredible gains since the market lows of 2011, recovering at least 30 percent or more of the individual market value. Jacksonville and Orlando home prices have increased by 33 percent and 44 percent, respectively, while Tampa and Miami home prices have skyrocketed by nearly 56 percent and 57 percent, respectively over the same period.
“Florida has traditionally been regarded as prime real estate by those retirees who may be looking to migrate from colder areas of the nation such as the Northeast to a warmer and sunnier alternative for their golden years,” Villacorta said. “As the top Floridian housing markets continue to grow and return impressive price gains–Tampa is currently reporting 12.2% annual price growth–it’s no surprise that this generation continues to invest in real estate in the region. The baby boomer share of homeowners is clearly on the rise here, and as more and more of this generation nears retirement age, Florida markets may be in for a boost in performance if tradition continues and retirees demand homes in the region,”
Villacorta said recent Census Bureau data suggests homeowners aged 55-74 have increased more than 2.5 timesthe overall population of homeowners in each of the top four Florida markets since 2011; In Miami and Jacksonville, the increase in homeowners of this generation is more than 500 percent% greater than the overall increase in the total population of homeowners. In Orlando, the trend is quite similar as the ratio of baby boomer homeownership growth to overall homeownership growth is more than 400 percent.
“It’s evident that the baby boomer demand for housing in the region is a significant contributing factor in the market’s overall success,” Villacorta said.
