Jacksonville: Real Estate and Market Trends

Jacksonville is the largest city in Florida, both in terms of population and sheer size. Therefore, positive trends in the real estate industry should be viewed as a big step for the entire state of Florida. Fortunately, Jacksonville has made significant improvements since the latest recession. Having said that, experts expect both a strengthening job sector and increasing home values to continue for the foreseeable future. Jacksonville, for all it has been through in recent history, is actually doing very well for itself.

The Jacksonville housing market, while not as highly publicized as some of Florida’s more prominent markets, is making a name for itself. Despite being in a distressed state, recent trends suggest that the local market has done enough to remove itself from a period of post-recession price weakness. Currently, the average price of a home in the Jacksonville region is $186,500. Despite historically high appreciation rates over the last three years, the current median home price in Jacksonville is about $30,000 below the national average. On a more encouraging note, experts have already predicted an increase of more than 2 percent in home prices for the Jacksonville real estate market 2015.

View of downtown Jacksonville

Homes in the Jacksonville housing market have only managed to appreciate 0.8 percent over the course of a year. Subsequently, homes in the area experienced an appreciation rate of more than 47 percent over the past three years. So while prices are continuing to rise, there is clear evidence that the rate of appreciation is beginning to ease. With that appreciation rate, nearly 37 percent of the homes sold in Jacksonville received less than the listing price.

Howard Dyal, president of the Jacksonville chapter of the Florida Association of Mortgage Professionals, believes that Jacksonville is heading in the right direction. “I’d say it’s a seller’s market in neighborhoods like Avondale, Riverside, San Marco, San Jose, Ponte Vedra and the beaches. Other areas are still depressed; they need to go through gentrification. Overall, you certainly are seeing a lot of housing growth, a lot of apartment growth, and that’s encouraging for the local economy,” he said.

Over the past three years, homes across the nation have been the beneficiaries of historically high appreciation rates. In fact, home values have nearly returned to their pre-recession levels. The Jacksonville housing market is no exception. Homeowners in this area have received a lot of equity over the course of three years. The Jacksonville real estate investing market is no exception. The following highlights how much equity has been gained relative to the year of the home’s purchase:

  • Homes purchased in the Jacksonville housing market one year ago have appreciated, on average, by $4,257. The national average was $12,783 over the same period.
  • Homes purchased in the Jacksonville housing market three years ago have appreciated, on average, by $65,748. The national average was $55,406 over the same period.
  • Homes purchased in the Jacksonville housing market five years ago have appreciated, on average, by $51,449. The national average was $49,675 over the same period.
  • Homes purchased in the Jacksonville housing market seven years ago have appreciated, on average, by $13,979. The national average was $9,474 over the same period.
  • Homes purchased in the Jacksonville housing market nine years ago have appreciated, on average, by $24,752. The national average increased $3,419 over the same period.

Jacksonville’s job sector continues to support the progression of the housing market. In fact, Jacksonville was recently ranked by WalletHub as the 49th best city to find a job – the second highest city in Florida. While still a far cry from cities like Seattle, ranking in the top third is more than encouraging for Jacksonville. Where the city really excels is its job growth rate. Over the course of a year, jobs have grown at a rate of more than three percent. The national average, on the other hand, was under two percent. Perhaps even more importantly, job growth in the area is expected to continue. That said; unemployment has dropped nearly an entire percentage point from this time last year. At 5.8 percent, Jacksonville’s unemployment rate is below the national average. There is very little to prevent the job sector from serving as the main driver of both supply and demand for the Jacksonville housing sector. In the face of a healthy economy, real estate activity should see an uptick. In fact, the entire state of Florida saw positive trends in economic indicators.

Despite nearly three years of appreciation, the Jacksonville housing market remains affordable. As recently as 2013, homeowners were using more than 8 percent of their income to pay for their mortgage. However, in spite of inflation and appreciation, that number did not increase dramatically. Currently, homeowners allocate 9.8 percent of their income to the monthly mortgage. Compared to the national average – 16.3 percent – Jacksonville is more affordable than most markets. Affordability, in association with a strong job sector, will continue to drive supply and demand in the region.

Inventory in the Jacksonville housing market appears to have stabilizes, as new housing construction continues to grow. Over the course of a year, single-family housing permits have increase about 2 percent. While below the national average, the increased inventory could be responsible for a moderation in prices. Of particular interest, however, is the addition of new homes via distressed sales. Accordingly, both foreclosures and short sales now add more inventory to the market than new construction. Their presence may place downward pressure on median home prices.

Investors looking to get into the Jacksonville housing market may want to consider the following neighborhoods, as they have been deemed the most popular by Trulia:

  • Riverside
  • Mandarin
  • East Arlington
  • Chimney Lakes
  • Golden Glades/The Woods

Delinquent mortgages account for nearly ten percent of all mortgages in the city of Jacksonville. The national average is 6.4 percent. However, the number of homeowners that are actually underwater is considerably higher at 33.6 percent. As recently as the fourth quarter of last year, one out of every 230 houses in Jacksonville were somewhere in the foreclosure process.

Jacksonville Housing Market Summary:

  • Current Median Home Price: 186,500
  • 1-Year Appreciation Rate: 0.8%
  • Unemployment Rate: 5.8%
  • 1-Year Job Growth Rate: 3.3%
  • Population: 842,583
  • Median Household Income: $48,143

Jacksonville Housing Market Q1 Update:

The Jacksonville housing market continues to appreciate at a faster rate than the national average. The median home price for the area is now sitting at $187,700, well bellow the national average, but considerably more affordable too. On top of that, the area’s job sector continues to support supply and demand. Unemployment continues to drop and job growth is blistering. For all intents and purposes, the combination of these factors has made Jacksonville a great area for investing.

The Jacksonville real estate investing market is firing on all cylinders, as distressed properties continue to serve as a great source of deals. According to RealtyTrac, Jacksonville real estate investors have a pool of foreclosures more than 7,000 deep to choose from. At 7,115, foreclosures have actually risen since the same time last year. The majority of Jacksonville’s distressed properties are scheduled to be placed up for auction, meaning 42.6 percent of them will be available to the highest bidder. Another 33.1 percent are currently sitting on the books of banks as non-performing loans. That said, bank-owned foreclosures will continue to fuel the Jacksonville real estate investing market.  The remaining foreclosures are those that have yet to actually be foreclosed on. However, these are properties where homeowners are behind on payments. Again, another great source for those interested in Jacksonville real estate investing.

Of course, the biggest draw for investors remains the discount that these properties provide. According to RealtyTrac, the average non-distressed home sold for about $104,000 in the Jacksonville housing market. On the other hand, distressed properties have an average sales price of $58,900. That is a savings of more than $45,000 per property, or 43.4 percent.

Jacksonville Real Estate Investing Statistics:

Jacksonville real estate investing statistics

Jacksonville County Map:

Map of Jacksonville neighborhoods

*The information contained herein was pulled from third party sites. Although this information was found from sources believed to be reliable, FortuneBuilders Inc. makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. Any reliance on this information is at your own risk. All information presented should be independently verified. FortuneBuilders Inc. assumes no liability for any damages whatsoever, including any direct, indirect, punitive, exemplary, incidental, special, or consequential damages arising out of or in any way connected with your use of the information presented.
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