The drop in condo sales is not confined to South Florida.
Statewide, the pace of the sale of condominiums and townhouses fell almost 21% in September compared to a year earlier. The number of units looking for buyers shot up by 65%.
The sharp increase in condos for sale and fall-off in sales activity comes in response to reforms passed after the 2021 collapse of the Champlain Towers South building in Surfside killed 98 people. Two significant changes approved by state lawmakers go into effect with the new year.
All condo buildings at least three stories tall and more than 30 years old need to have a milestone safety inspection completed by New Year’s Eve. That inspection has led to significant special assessments for some buildings to raise the money needed to fix problems. Then, beginning in 2025, condominium owners associations across the state need to begin socking away money in reserve funds for regular maintenance of certain systems like electrical, plumbing and roofs. This is the first time Florida condo associations will be required to save money for such repairs. In the past, associations were able to waive building up their financial reserves.
As the deadlines approach, the state’s condo market is slumping.
The number of condos sold in September fell for the fifth consecutive month. The decrease was the steepest of the year. Last month was the slowest month of condo sales in Florida since May 2020 when the COVID-19 pandemic was raging and much economic activity was shut down.
The fall-off is widespread across the state. Seventeen of the 22 metro markets tracked by Florida Realtors recorded double digit drops in sales volume last month. Only the Jacksonville, Lakeland and Ocala areas saw more condos sold in September than a year ago.
Median prices of units sold dropped in 16 of the 22 regions with prices down at least 30% in the Pensacola and Vero Beach areas. New condo developments in some regions may be helping push up median sales prices.
The sales downtrend is likely to continue. Pending sales in September decreased 16%. This indicator of future closed sales has fallen by double digits in six of the past seven months.
While the number of condos for sale has jumped substantially, the number of new listings in September fell by 2%. Higher prices usually spur more owners to put their units up for sale. The drop in new listings may be an indication of owners reluctant to sell as median prices fall.
The data from Florida Realtors does not parse out sales information based upon the age of a condo building.
READ MORE: Supply of condos for sale keep growing in South Florida — even as condo sales keep slowing
The trade group noted in a news release that Hurricane Helene disrupted the state’s housing market for several days. The storm made landfall Sept. 26 in the Big Bend region.
October’s data is likely to be similarly affected by Hurricane Milton, which came ashore on Oct. 9 near Siesta Key.
Before the storms Gov. Ron DeSantis said he wanted state lawmakers to return to Tallahassee before the end of the year to address the condo association reforms. A month before the governor made his comments, Senate President Kathleen Passidomo rejected calls for a special session to address the new regulations.
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