Florida, renowned for its sunny climate, sandy beaches, and enticing attractions, is a popular U.S. destination. However, the escalating mortgage rates leading to inflated home prices might have some residents contemplating relocation.
GOBankingRates published a study on Florida’s housing market, identifying seven cities potentially heading toward a housing crisis.
The analysis by GOBankingRates involved data from the Consumer Financial Protection Bureau, the Consumer Protection Bureau, and RealtyTrac. The study reviewed the largest 200 Florida cities in terms of total housing units and considered variables such as the proportion of mortgages delinquent by one to three months and both homeowner and renter vacancy rates.
Below is the complete list.
Orlando
- The vacancy rate among homeowners: 5%
- Delinquent mortgages for 90 days: 0.5%
Fort Lauderdale
- The vacancy rate among homeowners: 4.1%
- Delinquent mortgages for 90 days: 0.6%
Gainesville
- Vacancy rate among homeowners: 3.6%
- Delinquent mortgages for 90 days: 0.6%
Miami
- The vacancy rate among homeowners: 2.2%
- Delinquent mortgages for 90 days: 0.6%
Jacksonville
- The vacancy rate among homeowners: 2.0%
- Delinquent mortgages for 90 days: 0.6%
Hollywood
- Vacancy rate among homeowners: 1.6%
- Delinquent mortgages for 90 days: 0.6%
Pembroke Pines
- The vacancy rate among homeowners: 0.9%
- Delinquent mortgages for 90 days: 0.7%
Methodology of Research
To identify the Florida cities most susceptible to a housing crisis, we conducted a comprehensive analysis involving the top 200 cities based on the number of total housing units. Our method relied on data regarding mortgage delinquency and vacancy rates, with the data originating from credible sources such as the Consumer Financial Protection Bureau and the 2020 American Community Survey.
Initially, we looked at four key factors:
- The proportion of mortgages 30-89 days past due, sourced from the Consumer Financial Protection Bureau.
- The proportion of mortgages that were delinquent for more than 90 days, again, sourced from the Consumer Financial Protection Bureau.
- The rate of homeowner vacancy was informed by the 2020 American Community Survey data.
- The rental vacancy rate was obtained from the same 2020 American Community Survey.
These factors were evaluated and assigned scores for each city, with higher scores signifying a greater potential for a housing crisis. We assigned twice the weight to factors 1 and 2 due to their criticality, while factor 4 had half the weight.
Based on these scores, we narrowed down our list to the 100 cities showing the highest potential for a housing crisis. This shortlisted pool was subjected to a second round of scoring, this time, introducing an additional factor:
- The rate of foreclosure, with data procured from RealtyTrac.
In this round, the same weightage was applied as in the first round, and the foreclosure rate was given a 1.5x weight due to its direct impact on the housing situation.
The scoring process produced a final list of cities ranked based on their vulnerability to a housing crisis. Of these, we focused on the top 10 cities in Florida, indicating those most at risk.
Our analysis relied on data as recent as May 23, 2022 and the final rankings were established by November 8, 2022.
Source:
https://www.fox35orlando.com/news/these-7-florida-cities-could-be-headed-for-a-housing-crisis
https://finance.yahoo.com/news/7-florida-cities-could-headed-120114061.html
