South Florida housing market splits between single-family homes and condos

The South Florida real estate market is experiencing a divergence between single-family homes and condominiums. In Palm Beach County, single-family homes remain a seller’s market with approximately 3.5 months of supply, while the condo market has shifted toward buyers with 6.7 months of supply.

Condominium buyers face unique challenges, particularly in older buildings. Following Florida reforms after the 2021 Surfside collapse, associations must conduct structural integrity reserve studies and fund necessary repairs. This has led to increased monthly dues and special assessments. Furthermore, financing for condos has tightened; in South Florida, it is estimated that only about 21 out of 2,400 condo buildings are approved for FHA loans, leading to a high volume of cash purchases.

In Miami Beach, the market is characterized by distinct price tiers. Single-family homes often reach multi-million-dollar prices, necessitating jumbo loans, while condos typically list between $520,000 and $550,000. Lenders in the region must perform specialized underwriting for condominiums, evaluating the financial health of the entire building association, including reserve funds and insurance, to determine if a property is warrantable for Fannie Mae or Freddie Mac backing.