Investors’ condo purchasing has dropped to one of the lowest levels in the past decade. This is a shift driven primarily by retreat from Florida, new research shows.
An analysis conducted by real estate broker Redfin examined county-level home purchase records in 2000 in 39 most populous US metropolitan areas. So, with the exception of the second quarter of 2020, “the beginning of the pandemic is largely rooted in shutting down the housing market,” Redfin said.
Redin said that what’s contributed to the decline is rising amid the Florida association’s surge, increased premiums and “among rising climate-driven natural disasters.” “In addition, many of Florida’s condominium buildings are oceanfront and are particularly vulnerable to climate disasters.”
“Safer bets for investors”
Condo purchases fell by 3%, while other purchases remained stable. Investors’ purchases of US homes increased 2% year-on-year in the first quarter.
“If I were an investor, I would probably look for a detached house on a condominium,” Ejator said, Greg Ecaesar, a partner at ICASAR Law Firm, which focuses on real estate law. “I think that’s a safer bet for investors these days.”
Eisinger said one reason condominium purchases are down is because people are worried about the rise in the number of hurricanes that are weathering in Florida, where there are plenty of beachfront condominiums.
John Cadden, principal of the Condominium Advisory Group, said the decline in condominium purchases was also due to the condo interest rates over the past few years. Cadden’s Advisory Group will consult with condo associations around the state facing problems.
“When interest rates started to rise, it was more effective than the pandemic itself,” he said.
Increase safety
New safety guidelines have been enacted after the collapse of the Champlain Towers South Condominium building on Surfside, which killed 98 people.
The Condominium Association has also increased the fees to cover inspections of old buildings and book set funds for maintenance and future repairs, as requested by the Florida Legislature. The changes were enacted to improve safety, but contributed to increased costs.
“Most associations try to keep their membership fees up to date while they’re not increasing their costs,” Eisinger said. “But now everything’s in my mind and I don’t have any choice.”
In April, the Florida Legislature passed a bill that gave the association more time and flexibility while raising funds to meet preparatory requirements. Governor Ron Desantis is expected to approve it.
Florida condominiums could lose popularity and ultimately benefit some buyers who are less competitive, but only to some extent. “Florida is bounced back,” said Caden, the advisory group. “It’s still a place where people move in. It’s still growing.”
Original issue: June 12, 2025, 4:59pm EDT
