Condominiums saw a year-over-year price decline of 0.26% across the U.S. in March, the first time condos suffered a price drop in a decade, according to Intercontinental Exchange (ICE), a global provider of technology and data. Condo prices also lagged single-family home price growth in 97 of the 100 largest markets in the country.
Condos in the Sunbelt and especially Florida saw the biggest prices drops. The plus side is that this could help with the affordability challenges facing many potential homebuyers, said Andy Walden, head of Mortgage and Housing Market Research for ICE.
Walden noted that “while falling condo prices can erode equity levels among existing condo owners” they also provide “modest relief” for prospective homebuyers.
“In fact, 95% of U.S. markets have experienced at least slight improvements in affordability compared to a year ago,” Walden added.
The losses were a part of an overall cooling in home price growth, according to ICE. Annual home price growth was still positive, but slowed to 2.7% in February, with early data for March showing further cooling to 2.2%.
Some 90% of U.S. markets experienced slower home price growth compared to three months ago, according to ICE’s Home Price Index. This is due to improved inventory levels, which are up 27% over last year, and stabilized mortgage rates, which have been holding in the 6.6% to 6.7% range.
Florida homeowners faced particularly difficult challenges over the past year. Back-to-back hurricanes, combined with rising property insurance costs, challenges to even get insurance, slowing migration and new construction have combined to lower home prices in most major Florida markets.
Florida markets that saw the steepest prices declines include: North Port (-9.4%); Lakeland (-7%); Tampa (-5.8%); Orlando (-4.4%); Jacksonville (-4.4%); and Miami (-2.8%).
Florida wasn’t alone in seeing condo-price drops. Condo prices have also fallen by more than 3% in Little Rock, Ark. (-6%); Austin, Texas (-5.6%); Colorado Springs, Colo. (-4.4%); Memphis, Tenn. (-4.2%); Denver (-3.9%); Stockton, Calif. (-3.7%); Houston (-3.6%); and San Antonio (-3.1%).
