Pending home sales plunged in three cities in South Florida in the aftermath of Hurricane Ian. Cities hit by the hurricane declined at nearly twice the nationwide rate. This is according to a new report from Redfin.
Cities affected the most
Pending home sales plunged 58% year over year in the Cape Coral. Pending sales also slumped in the nearby Naples (-52%) and North Port (-51%) metro areas.
Other Florida metros experienced large—but less severe—declines include:
- 47% in Miami
- 46% in Jacksonville
- 43% in West Palm Beach
- 40% in Deltona, Tampa and Orlando
Related: Why Don’t Hurricanes Directly Hit Tampa Bay?
Southwest Florida saw outsized decreases in pending sales as the storm quashed home listings. In Cape Coral, new listings sank 59% year over a year during the four weeks ending Oct. 16—more than triple the national decline of 19%. They fell 53% in Naples and 40% in North Port.
New listings also fell in other parts of Florida, but not as sharply. They were down 33% in Jacksonville, 30% in Orlando and 28% in both Tallahassee and Tampa.
Slowdown of market growth
Hurricane Ian has exacerbated a housing-market slowdown in Southwest Florida that was already more severe than the downturn in other parts of the U.S. North Port and Cape Coral were among the fastest cooling housing markets in the country prior to the storm. That’s largely because scores of people moved in during the pandemic, which drove prices to record highs and caused the markets to overheat. Cape Coral had the highest price growth in the nation in August, the month before the storm. Tampa, North Port, and West Palm Beach rounded out the top five.
Cape Coral, North Port and Tampa have consistently ranked on Redfin’s list of most popular migration destinations during the pandemic. Popularity is measured by net inflow, or how many more Redfin.com users looked to move into an area than leave.
Climate risk aversion
While nearly two-thirds of homebuyers and sellers say they’re hesitant to move somewhere with climate risk, many still did during the pandemic because they were searching for relative affordability, lower taxes and/or warm weather. A 2021 Redfin analysis found that more people moved into than out of the U.S. counties with the largest share of homes facing high flood risk from 2016 through 2020—a trend that intensified during the pandemic moving frenzy.
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While pending home sales and listings are plunging in Southwest Florida, home prices remain elevated. In Cape Coral, the median new listing price rose 15% year over year to $408,231 during the four weeks ending Oct. 16. That’s nearly double the national increase of 8%. The median new listing price climbed 14% in North Port and 24% in Naples.
While prices remain up on a year-over-year basis, price growth has slowed from recent weeks. If prices continue to ease, more investors may see an opportunity to buy and flip damaged homes in Southwest Florida. Florida is already a hotspot among investors. In Jacksonville, 31.9% of homes that sold in the second quarter were bought by investors—a higher share than any other market analyzed by Redfin. Miami, Orlando and Tampa were also in the top 10.