Florida’s housing market isn’t broken — it’s stuck.
Only a tiny percentage of homes are selling, and the main reason is simple: almost everyone is locked into ultra-low mortgage rates.
More than 70% of U.S. homeowners have mortgages under 5%. Many are sitting on 2–3% rates. Combine that with Florida’s homestead tax rules — where property taxes reset (and often jump dramatically) when you buy a new home — and nobody wants to move.
Low rate + low tax bill = a golden ticket nobody wants to give up.
Meanwhile, buyers still want to move to Florida, but the math has changed. Take a $1.3M home as an example:
At 3%, P&I is about $4,385
At 6%, it jumps to $6,235
Same house. $1,850 more per month. Most buyers can’t qualify at today’s rates, so the move-up market — the segment that normally keeps everything flowing — has completely frozen.
Some propose a “solution” like the 50-year mortgage, but that only benefits banks. It slightly lowers the monthly payment while adding hundreds of thousands in extra interest. It doesn’t fix affordability.
But one change actually could:
Assumable Loans.
If Fannie Mae and Freddie Mac open the door for conventional mortgages to become assumable, buyers could take over a seller’s existing low-rate loan — same balance, same rate, same remaining term.
Example:
Seller’s mortgage: $500,000 at 3%
Home price: $700,000
Buyer assumes the $500k loan at 3% and finances the remainder separately.
This instantly restores affordability and mobility. Even if only a fraction of low-rate mortgages become assumable, thousands of previously “stuck” homes suddenly become reachable.
Now add a second possible shift:
Eliminating property taxes on primary homes in Florida.
Remove the tax reset penalty + revive low-rate mortgages, and you’ve just eliminated the two biggest obstacles keeping people from moving.
If both of these hit in 2026, Florida’s housing market won’t just thaw — it will ignite.
What buyers and sellers should do now
Buyers: Watch for assumable mortgage opportunities and get prepped financially. These deals will go fast.
Sellers: If you have a 3–4% mortgage, that loan itself becomes a huge selling point. You may attract more offers simply by allowing it to be assumed.
The market is frozen because too many people are locked in.
Assumable loans and property tax reform could finally unlock it.
Read the full article here:
👉 https://sancastlerealty.com/post/florida-housing-unfreeze
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