February was a rough month for the condominium market, with roughly two-thirds (68.4%) of these properties selling for less than their original asking price, according to new data from Redfin (NASDAQ: RDFN). This is up from 63.3% a year earlier and the highest February level in five years.
Redfin also reported the share of townhouses selling for below their original asking price also hit the highest February level in five years, rising to 59.4% from 54.7% one year earlier. In comparison, the share of single-family homes selling for less than list price climbed to 64.2% from 61.2% one year earlier, the highest February level in two years.
Redfin attributed the problems impacting the condo sector to rising insurance costs and new safety regulations that caused HOA fees to soar. Florida, in particular, has seen its condo market in severe doldrums.
“The Florida condo market is in uncharted territory,” said Tim Harper, a Redfin Premier real estate agent in the Orlando metro area, where 84.8% of condos that sold in February went for less than their original asking price. “We’re seeing a massive influx of condo inventory because a lot of senior citizens on fixed incomes can no longer afford their monthly payments, and a lot of other condo owners just want to move because they’re tired of dealing with rising HOA fees and special assessments.”
