South Florida’s Pandemic Real Estate Boom Fades Amid Surging Inventory and Rising Costs

South Florida’s once-thriving real estate market, buoyed by pandemic-era migration and investment, is experiencing a significant slowdown. A recent report by Cotality reveals that the number of homes for sale in Miami-Dade, Broward, and Palm Beach counties has quadrupled since 2022, reaching over 52,000 listings in April 2025—the highest level in nearly a decade.

Key Factors Driving the Market Shift

1. Escalating Homeownership Costs:
Florida homeowners are grappling with the nation’s highest average home insurance premiums, approximately $11,000 annually—nearly four times the national average. This surge is attributed to increased hurricane activity and a shrinking pool of insurers.

2. Declining Migration Trends:
The pandemic-induced influx of residents to Florida has waned. Net domestic migration to the state dropped to +64,000 in 2024, a stark contrast to +314,000 in 2022. This decline has reduced demand, particularly in markets that previously relied heavily on out-of-state buyers.

3. Regulatory Impacts on Condominiums:
Following the 2021 Surfside condo collapse, Florida implemented stringent safety regulations requiring structural inspections and reserve funds for older buildings. Compliance costs have led to significant increases in homeowners association (HOA) fees and special assessments, prompting many owners to sell. Consequently, prices for older condos have plummeted by up to 22% over two years.

4. Rising Construction and Material Costs:
Labor shortages, increased material costs, and tariffs have added financial strain to developers, causing many to pause projects. This slowdown in new construction contributes to the growing inventory of unsold homes.

Implications for Buyers and Sellers

The current market conditions present both challenges and opportunities:

• Buyers may find increased negotiating power due to higher inventory levels and stabilizing prices. However, elevated insurance premiums and property taxes could offset potential savings.

• Sellers, particularly those with older properties or in overbuilt areas, may need to adjust pricing expectations and be prepared for longer listing periods.

As South Florida’s real estate market transitions from a pandemic-driven boom to a more balanced state, stakeholders should stay informed and adapt strategies accordingly.