Florida Homeowners Are Desperately Trying to Move Out

Florida has the highest number of "motivated" sellers listing their properties on real estate marketplace app Zillow, according to data on the platform.

A search showed that, as of Wednesday, February 28, there were 4,928 listings on Zillow's app for Florida properties whose sellers described themselves as "motivated"—meaning they would accept lower offers from potential home buyers to sell quickly. Motivated sellers can be driven by financial loss, divorce or separation, job relocation or other personal issues.

Vacation rental investor Rohin Dhar noticed the spike in motivated sellers in the Sunshine State, writing about it on X and wondering what was "going on" in Florida. Dhar compared Florida's numbers to those of California, New York and Texas, which all had lower figures.

As of Wednesday morning, California had 1,069 motivated sellers, while New York had 424 and Texas 1,775. Newsweek found that Florida was in fact the state with the highest number of motivated sellers in the entire country.

Florida has more listings, in general, than the rest of the U.S. "because we have not only so many residential properties people live in, but also vacation properties, and it's a large state to begin with," Florida Realtors® Chief Economist Brad O'Connor told Newsweek. As of Wednesday, Florida had a total listings of 202,000 properties, against California's 73,000, Texas' 172,000 and New York's 42,000.

Dhar also shared search results for individual Florida cities on X, showing that listings from motivated sellers totalled 1,086 in the area around Fort Lauderdale and Miami, 1,136 around Orlando and 1,083 around Tampa, as of February 27.

Newsweek contacted Dhar for comment by direct message on X on Wednesday, and also contacted Zillow by email.

The number of motivated sellers in Florida suggests that a high number of homeowners are trying to get rid of their property quickly. But why?

"Florida had the highest home price appreciation over the past three years, and some people may be cashing out," Lawrence Yun, chief economist and senior vice president of research at the National Association of Realtors (NAR), told Newsweek.

"Also, property insurance readjustments—like any other added cost of ownership—will induce some additional sellers. Some retired homeowners on fixed income could be forced to sell. NAR has been advocating in Congress for a gradual increase regarding flood insurance premiums," he added.

"We're seeing a lot more listings in general in Florida than we were a year ago, and that's been the case the last four to five months," O'Connor said. "But if you look at historical data, the number of new listings we're seeing now is actually very similar to that of four to five years ago, prior to last year. So last year was kind of the anomaly, we had a low number compared to normal."

While the Federal Reserve announced in December that it had concluded its aggressive rate hike campaign, mortgage rates remain high, generally discouraging sellers from putting their homes on the market. But O'Connor said sellers might have just become used to it.

"I think people are now more comfortable with the fact that, you know, interest rates are up here to stay," he said. "I think initially when rates rose quickly, people were uncertain as to where they would go from there. But now we're pretty much in a situation where I think everyone's comfortable with the idea that rates are probably going to stay about where they're at, or they're going to decline somewhat in the next year or two."

One reason homeowners might be willing to sell despite the less than ideal market conditions might be the high insurance rates in the state, which have risen dramatically in the past few years.

According to data from the Insurance Information Institute (Triple-I) cited by Fox 13, home insurance costs have increased by 102 percent in the past three years in Florida, and they are three times more expensive than the national average.

Home insurance in 2023 was about $6,000, according to Triple-I—the highest premium in the country.

"For some people, that [higher premiums] have changed their calculus in terms of affordability," O'Connor said. "We don't have great data on exactly how much insurance rates are increasing in different parts of the state, but, anecdotally, we've received lots of complaints of pretty substantial increases. So I'm sure that's something that's going on and might be motivating some buyers or seller owners to list their properties."

Insurance expert Lisa Miller told Fox 13 that she had spoken with condo board members from around the state who had premiums around $65,000 four years ago that had skyrocketed to nearly $800,000.

"It's just unsustainable," she said. "I think things are going to get better in 2024. I think we'll see rates stabilized."

Motivated sellers in Florida are unlikely to have to compromise for a much lower price than the one they originally listed.

"Despite more listings, there are also plenty of buyers and potential home buyers," Yun said. "Florida has consistently been one of the top five states in terms of job creation. Therefore, the discount is not likely to be significant."