Beautiful Residential Home in Florida – Courtesy: Shutterstock – Image by Mike Focus
While home prices in the Northeast are still rising, real estate consultant Nick Gerli predicts that a spike in inventory in Florida and Texas will lead to sharp price drops in the two regions’ housing markets.
Texas and Florida “dominos have fallen,” Gerli, CEO of Reventure App, a real estate analytics platform, posted on X Monday.
The Significance of It
Due to the migration of out-of-state residents from colder, more costly parts of the country, the housing markets in Florida and Texas saw a boom throughout the pandemic.
However, since the end of the pandemic, in-migration has slowed down, and the markets that exploded during the health emergency are now experiencing the most dramatic cooldowns in the nation. In recent years, the two states began building more homes than anywhere else in the country to meet that growing demand.
Things to Be Aware Of
In January 2025, there were 261,000 active listings in Florida and Texas combined, which is 207 percent greater than the total amount reported for the Northeast, according to statistics from Reventure App. In the same month, a total of 85,000 active listings were reported by the Northeastern states.
The difference between the two “highlights the very bifurcated nature of this housing market,” Gerli wrote on X, adding that “prior to the pandemic, these regions were the same.” While TX and FL are experiencing a decline, the Northeast is still experiencing a historic inventory scarcity.
Because “many real estate outlets don’t want to admit the TX/FL dominos have fallen, as those are the states with the most realtors, investors, wholesalers, and people who buy housing market-related,” Gerli claims that the likely decline in the housing markets in Texas and Florida is going unreported.
Gerli claimed that there is “little investor and realtor activity” in the Northeast in comparison to Florida and Texas, “so it’s not much of a sell to talk about the outperformance.”
What Individuals Are Saying
“I think Florida and Texas will be the best markets for U.S. homebuyers this year,” Redfin analyst Chen Zhao previously told Newsweek, adding that purchasers in the weaker Sun Belt areas, like Florida and Texas, may be able to negotiate the best bargain and have the most options. There won’t be as much inventory and less wiggle room in other markets.
Matthew Walsh, an analyst at Moody’s Analytics, recently told Newsweek that Florida is a state to keep an eye on this year for buyers due to its overvaluation during the pandemic: Given the state’s economic fundamentals, including income growth and household formation, property prices there have increased significantly and have somewhat outpaced the rate at which we would anticipate them to do so. And when demand begins to decline, that discrepancy does have an impact on prices.
Next Steps
According to the real estate researcher, a decline in the Florida and Texas markets is not all bad news for Gerli; rather, it is a chance for these two states.
“What many in the real estate industry fail to realize is that a downturn in the Sun Belt will actually be a good thing for the housing market in the long-term,” Gerli stated. “Because more inventory and cheaper prices will ultimately be what draws buyers back into the market.”
Gerli said that prices must drop to get homebuyers back into the market. “Inventory levels must rise sufficiently to compel sellers to make significant price reductions in order for prices to decline. That’s taking place, particularly in South and Texas/Florida,” he stated.
“It’s not in [the] Northeast. There is intense rivalry and even bidding wars when there aren’t enough houses for sale.
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Born and raised in South Florida, Krystal is a recent graduate from the University of Miami with professional writing experience at the collegiate and national news outlet levels. She’s a foodie who loves all things travel, the beach, & visiting new places throughout Florida.