Tonya Lockamy, a broker with Swan City Realty in Lakeland, Florida, said it was as if she physically experienced the drop in home sales in her hometown.
“I felt like I hit a brick wall around September of last year,” Lockamy said.
The U.S. Census Bureau ranked Lakeland-Winter Haven as one of the nation’s fastest-growing metropolitan areas in 2024, but Lakeland saw the steepest drop in home prices in the country in April. Local experts say more houses for sale are primarily responsible for the tumble.
It's a labor shed for larger cities
Florida received 24.7% of the country’s domestic migration between July 2020 and July 2024, with 41.5% settling in Central Florida, according to research by Placer.ai.
The city of Lakeland forms a rough midpoint between the more established metropolitan areas of Orlando and Tampa Bay, sitting roughly 90 minutes from each on Interstate 4. As part of rural Polk County, it’s also significantly less expensive than its sisters to the east and west.
“If you work in Orlando or Tampa, you could come to Polk County and buy a house for $100,000 less,” said Gary Ralston, a partner and managing director at Lakeland-based Saunders Real Estate.
Of the 284,333 workers who live in Polk, a little more than half, 142,845, work outside the county, according to U.S. Census data.
Lakeland’s population grew 12.1% between 2020 and 2023, the fastest pace in the nation by nearly 3 percentage points in that time frame, followed by three more Florida cities.
“I think the prices, especially in Orlando, were just going up so quickly. We were getting spillover,” Lockamy said.
Market slows after a rapid buildup
Lockamy said the post-pandemic years were the best for her practice, when listings would get dozens of offers in a matter of hours. She said the housing market in the area operated at such a blistering pace that it poisoned consumer expectations.
“You’ve got a lot of sellers who maybe made moves during the COVID era,” she said. “They expected the same result now, and when their home didn’t sell in two weeks, they gave it a price reduction.”
In April, Lakeland saw the sharpest drop in median home price in the country of 9%, according to the U.S. Federal Housing Finance Agency.
Research by Homes.com shows prices for single-family homes dropped more than 4% year over year, from $350,478 to $334,557. The average days on market grew from 59 to almost 83 over the same period.
Lockamy said some of her clients were “settling” when they bought homes in the fast market and now want out. Some, she said, are even looking to leave the state.
“Some people who moved down from up north have figured out that Florida isn’t where they want to go,” she said.
More homes coming online
However, data shows that interest in the region hasn’t died down much. Michelle Rumore, CoStar and Homes.com director of market analytics for Tampa Bay, said the population influx may have slowed but people are still coming.
“While the for-sale, single-family market is facing challenges, the Lakeland multifamily market is in the midst of a multiquarter run of near-historic levels of renter demand. At the same time, a record number of new [multifamily] units have come online, pushing the market's vacancy rate to all-time highs,” Rumore said.
Ralston said developers continue to acquire land in the county, estimating that roughly 40 new homes or apartments have been built daily for the last couple of years. “It’s a supply-and-demand issue,” he said.
Other issues have also had an impact, such as fluctuating mortgage rates and tighter lending scrutiny. This has also helped new construction builders, often large companies that can offer perks such as interest rate buydowns more easily than resellers can.
“The new home builders are still killing it,” Ralston said. “It’s the resellers that are suffering.”
Lockamy agrees that the falling prices are coming mainly from people already in homes. “I really think it’s a knee-jerk reaction,” she said. “If some of them would wait it out, they would probably get offers. But some people aren’t in a situation where they can do that.”
Lakeland has a lot of charm, Lockamy said, from safe neighborhoods to great parks to one of the world’s largest collections of Frank Lloyd Wright architecture. So beyond its use as a bedroom community for bigger cities, Lockamy isn’t surprised so many are loving her native home.
“I knew as a teenager Lakeland was going to blow up. It was just a matter of when.”