Are you a snowbird from Canada looking to escape to warmer climes during the harsh winter months? You’re not a rare bird. Statistics Canada estimates that between 300,000 and 375,000 people winter in the US and Mexico every year, and many choose to go to Florida.
While it has always been a popular destination for Canadians, the cost of living in Florida has been on the rise in recent years, leaving many wondering if it’s still affordable. A Maru Public Opinion poll conducted for CIBC asked 50+ Canadians who are not currently snowbirds (60%), whether they plan to become snowbirds in the future. Out of every eight people, only one person (about 13%) plans to do so.
Rising costs are the most often stated reason for not choosing Florida.
Let’s explore the reasons behind the increased costs and see if Florida is still feasible for snowbirds.
Florida real estate market
One of the main reasons for the increase in prices is the state of the real estate market. In 2022 buying or renting a house has become more expensive due to higher demand. Florida became an attractive homebuyer market, drawing people from other states and other nations. It was the hottest post-pandemic market in the USA; this increased demand drove up house prices in the area.
A very active hurricane season in 2022 didn’t help the situation, causing significant damage to properties and infrastructure. This resulted in decreased availability and higher insurance rates, making it more expensive for homeowners.
However, in 2023 we’re looking at a very different market, and Florida’s real estate market has slowed down significantly.
The cost of borrowing money to buy a home has increased to around 6%, making it challenging for people to find homes they can afford. According to Houzeo, 38.1% fewer homes were sold in January 2023 compared to the same time last year. It’s taking longer for homes to sell since there aren’t as many buyers who can afford them.
In February 2023, Fort Myers home prices were up 6.8% compared to last year, selling for a median price of $390,000. At the same time, the median listing home price in Palm Beach County, FL, was $505,000, trending up 14.8% year-over-year.
Impact on the rental market
Snowbirds mostly prefer to rent a place to stay, according to the Maru Public Opinion survey. Only 7% of them stay in a property that they own. About 24% rent a house, apartment, condo, or mobile home abroad, while 26% choose a short-term rental like Airbnb or Vrbo.
However, the rental market is also affected by the limited availability of real estate, making it harder for snowbirds to afford to stay in South Florida. Rent prices are going up, and in January, the median monthly rent for a two-bedroom apartment in Palm Beach County ranged from $2,295 in West Palm Beach to $2,734 in Boca Raton and as high as $3,138 in Jupiter, according to a rental website called Zumper.com.
Are snowbirds leaving Florida?
The answer is no. While some snowbirds have chosen to explore other winter destinations, such as Arizona or Texas, most are still drawn to Florida’s warm weather and attractions. However, they are more cautious with their budgets and are looking for ways to save money.
The survey says that 73% of snowbirds are concerned about the current economic environment (i.e., rising inflation) and its impact on their ability to live temporarily abroad. But the majority of them are not yet giving up on wintering abroad. Instead, they are trying to resolve the issue by delaying retirement to earn more savings (27%), cutting back on non-essential spending (27%) or downsizing their current home to help lower the cost of living (24%).
If Florida is still high on your list of the most desirable winter destinations, check out our Best Places To Live In Florida guide to find your piece of paradise. If you are more inclined to say, “See ya later, alligator!” to Florida and check out other places, look at Mexico or Costa Rica instead. Who can blame you for wanting to mix things up a bit!
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