F
lorida's real estate market is facing a perfect storm of high home prices, surging insurance costs, and dwindling buyer demand. According to Realtor.com, at least three cities - Tampa, Winter Haven, and West Palm Beach - are projected to see a decline in home values, with a 70% chance of price falls, categorizing them as "very high risk" for declines.

    The market's adjustment comes after years of soaring demand, which has since slowed due to rising mortgage rates and increasing insurance costs. Homeowners in Florida pay some of the highest insurance rates in the country, with an average annual cost of $2,207. This, combined with still-high home prices, has pushed homeownership out of reach for many would-be buyers.

    Florida Gov. Ron DeSantis recently hinted at supporting the abolition of property taxes, but acknowledged it would require a constitutional amendment. Meanwhile, Realtor.com's Hannah Jones notes that inventory has built up significantly across Florida, suggesting that home prices will continue to fall as sellers try to attract buyer attention.

    As the market searches for balance, Jones expects home prices to level off, but warns that this process will take time in Florida's large housing market. Over the past three years, inventory has recovered and prices have eased, signaling a return to balance.