You could earn up to US$80,000 in salary and still not be able to afford or qualify for a home, especially in Florida. Housing prices in the state and other parts of the US have forced would-be homeowners to stall their house hunt or rent.
Property values have typically done well during periods of inflation, but this time has increased property prices exponentially, putting a squeeze on purchasers’ already tight budgets.
In Florida, the average single-family home cost US$348,000 in 2021. Several families have reported being unable to afford their choice home after being outbid, turned down based on having a financial arrangement rather than cash and, being circumvented by blind offers. Would-be homeowners, including first timers, have simply been outpriced.
Today, a typical family needs to earn approximately US$87,000 to qualify for affording a single-family home, according to a report from the National Association of Realtors. In the last economic crisis, home prices did well. Just before the pandemic, the average house went for US$264,000 in Florida. This means that over a two-year period, house prices have increased by as much as 32 percent.
Florida’s housing woes have been attributed to several causes. The mild weather, absence of income tax and affordable property taxes make Florida a prime relocation destination. The pandemic itself magnified the persistent problem of low supply and high demand within the Florida real estate market but one report noted that the diversion of funds prior to the pandemic has been a major hindrance to affordable homes. Florida’s housing trust fund has been in place for over 30 years but doubles as a revenue source for political projects, as needed.
Florida Tax Watch, an independent research institute, predicts that housing prices will remain high in the foreseeable future and might reach as high as US$438,000 by 2030.
