A Typical Florida House Cost $45K in 1980 — What Is It Worth Today?

Home prices have exploded all over the country in the past few years; but, in the Sunshine State, these price hikes have taken on another dimension altogether.

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Consider this: In the past five years, home prices have increased 80% in Florida, according to Norada Real Estate Investments. In the 10 years between 2013 to 2023, they increased by an eye-popping 164%, according to South Florida Agent Magazine.

“That $30,000 Florida house from the ’80s? Easily worth $300,000 or more today,” said Dutch Mendenhall, co-founder of RAD Diversified .

The drivers? Population growth, inflation and demand for Florida’s warm climate, he added.

“The market is booming,” he said, “and what once seemed like a modest investment has now turned into serious wealth.”

The average Florida home value is $399,130, up 1.8% in the past year, according to Zillow. In comparison, the national average home price is $362,481.

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From $70K in the ’80s to More Than $800K Today

For homes near the waterfront, the trend is even more salient.

For instance, Kristen D. Conti, broker/owner at Peacock Premier Properties , gave the example of an Englewood, Florida, waterfront home on a gulf access canal. The home was built in 1982 and sold for $70,500.

“Today’s value is $835,000 at minimum, as this is just market value from the county, which is usually less than actual market value,” said Conti, citing estimates from the county assessor.

Waterfront properties have appreciated by eight to 10 times their value since they were built, Conti said.

“Nothing has changed about the houses in many cases, as many people don’t even renovate,” she said, “yet the land continues to rise in value.”

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Alex Blackwood, CEO and co-founder of alternative real estate investing platform Mogul Club , also noted that a typical home in Florida cost about $45,000 in 1980; that is equivalent to $172,000 in today’s dollars.

“However, today, homes in Florida cost $399,000 on average,” said Blackwood, adding that this points to the fact that real estate serves as an inflation hedge, meaning it appreciates at a faster rate on average than inflation.

“The drivers of home prices are simple: supply and demand,” Blackwood said. “As the population ages and increases, the demand increases and the supply remains finite, because we’re not building houses fast enough.”

Florida Home Prices Outpace National Growth

This trend is reflected all over the state and has been going on for quite some time.

In fact, annual home price growth in Florida has outpaced national home price growth every year since 2001, except for during the housing crisis, said Hannah Jones, senior economic research analyst at Realtor.com .

For instance, she said a typical Florida home sold for $120,000 in 2001. In 2023, that price had more than tripled to a startling $374,000.

According to Jones, Florida has seen booming demand but rather lackluster supply over the last decade, resulting in sky-rocketing price growth.

She noted, however, that while climbing prices and mortgage rates took a bite out of demand and allowed house inventory to recover into 2024, home sale prices have not yet fallen at the state level.

“In fact, the median home sale price in Florida hit a new peak of $395,000 in May 2024, which is the latest available data — 3.3 times the May 2001 price,” she said.

Jones also added that beyond the strong price growth throughout the last two decades, high demand amid low inventory drove home prices to new heights during the pandemic.

“Buyers took advantage of low mortgage rates and flexible work arrangements to lock in their dream home in the sun through 2020 and 2021, and even into 2022,” she said, “before pulling back once the combination of climbing prices and mortgage rates made purchasing a home less desirable.”

Some Challenges

While home prices have increased, helping equity, Florida homeowners also face numerous challenges, which can take a toll on their wallets.

As Jones noted, many homeowners in the state — especially those who bought in the 1980s or ’90s — have seen their home equity grow impressively. Yet, the state has become increasingly challenging to live in.

“Hurricanes, flooding and extreme heat present threats to property,” Jones said, “and home insurance costs reflect these risks, upping the ante for homeowners.”

This article originally appeared on GOBankingRates.com : A Typical Florida House Cost $45K in 1980 — What Is It Worth Today?