2024 First-Time Homebuyer Guide for Florida

In 2023, first-time homebuyers accounted for a fifth of all homebuyers, according to the National Association of Realtors. Purchasing a home in Florida presents distinct challenges, such as high demand, increased home prices, and difficulties in obtaining homeowners insurance. However, it also offers unique opportunities for borrowers, including a growing number of new homes, a diverse array of top lenders, and homebuying assistance programs that can assist with down payments, closing costs, and more.

The basics of buying a home in Florida

The real estate landscape in the state presents difficulties in homeowners insurance and property taxes.

Real estate market

A snapshot of the Florida real estate landscape in October 2024.

• The number of homes on the market increased by almost 45% from October 2023 to October 2024, with a total of 144,730 listings, according to the Federal Reserve Bank of St. Louis.
• The median home price in Florida is $434,995, which is a 6.9% decrease from 2023 and approximately 10% higher than the national average.
• A nine-acre three-home compound in Naples was listed for $295 million in February 2024, breaking the record for the most expensive home.
• Nearly 20% more homes on the market in Florida saw price reductions in October 2024 compared to 2023, with about a third of all listings experiencing reductions.
• The median number of days homes stayed on the market increased by 3% in 2023, to 76 days.

Florida homeowners insurance

In Florida, obtaining homeowners insurance is more challenging and expensive compared to many other states. The average annual premium in Florida was $5,527 in 2024, which is significantly higher than the national average.

In Florida, several insurers, including Farmers and AAA, have reduced or stopped issuing new policies.

The increase in the frequency and severity of hurricanes and flooding is driven by factors such as inflation, a favorable legal system for litigation, the widespread occurrence of roofer scams, and the high cost of reinsurance.

In Florida, you may need to purchase flood insurance, which averages $66 per month, according to National Flood Insurance Program data. Additionally, you may have a separate hurricane and named storm deductible, which can be up to 5% of your dwelling coverage.

Florida property taxes

Although Florida doesn't impose a state income tax, local municipalities levy property taxes, with an average rate of about 0.91% according to AARP. However, this rate can fluctuate significantly throughout the state.

Property taxes are calculated as a percentage of the assessed value of your home, which can fluctuate significantly from year to year. Florida's Save Our Homes exemption limits any rate increase for existing homeowners to 3% annually, even though the average home value in the state increased by over 160% between 2013 and 2023, according to Zillow's Home Value Index. If you move from one house to another in the state, you are still protected by this exemption. However, first-time buyers and those relocating to the state for the first time may experience a significant increase in property taxes compared to what the previous owner paid the previous year. It is crucial to factor in this increase when creating a budget.

Best Florida mortgage lenders

We've selected the top lenders in Florida in a variety of categories.

Best for a low down payment: New American Funding

New American Funding offers conventional mortgages with as little as 3% down, as well as VA and USDA loans that don't require any down payment. The company also promises to close loans in as little as 14 days, much faster than most mortgage providers.

Best for bad credit: Guild Mortgage

Guild Mortgage offers flexible credit score requirements and approves borrowers with a 600 credit score for its Zero Down mortgage. The lender also accepts nontraditional forms of credit, such as on-time rent, utility, and insurance payments, for some loans.

Best local lender: Choice Mortgage Group

Since its inception in Florida in 1995, Choice Mortgage Group, based in Boca Raton, has expanded its operations across the Southeast. The company provides a range of mortgage options, including conventional loans, government-backed FHA, VA, and USDA mortgages, as well as jumbo loans and cash-out and rate-and-term refinancing.

Best jumbo loan lender: Chase Bank

If you're interested in one of Florida's large mansions, Chase Bank offers jumbo mortgages up to $9.5 million.

If you want to work with a mortgage officer in person, you may be eligible for a relationship discount of up to 1% as a Chase customer, and there are over 400 Chase branches in Florida.

Best for veterans: Navy Federal Credit Union

In the U.S, Florida ranks third in population of veterans, following Texas and California. Navy Federal Credit Union is the largest issuer of VA loans, offering zero-down mortgages to active and retired service members without requiring private mortgage insurance. With low rates and exceptional customer service, NFCU has made our list of top lenders for VA loans. The Military Choice loan allows sellers to contribute up to 6% of the home's value towards closing costs.

Conforming loan limits in Florida

The Federal Housing Finance Agency sets the conforming loan limit, which is the maximum loan amount for Fannie Mae and Freddie Mac purchases, based on the median home value in each U.S. county.

In 2024, the conforming loan limit in Florida is $766,550 except in Key West, where it is $929,200.

The maximum loan limit for FHA mortgages in Florida's 67 counties is $498,257, except for a few counties.

Florida homebuyer assistance programs

Florida homebuyers can benefit from various programs that provide low down payments, closing costs, and additional benefits.

Florida first-time homebuyer loans

Are you considering purchasing a property in Florida? Check if you meet the criteria for one of these 30-year fixed-rate mortgage options.

This 30-year fixed-rate mortgage, backed by the Florida Housing Finance Corporation, is designed for first-time buyers who meet specific income and credit requirements and whose home price falls within the designated limit for their county.

First-time buyers who are frontline workers in Florida can receive a below-market rate and reduced fees on a conventional, FHA, VA, or USDA loan. Additionally, they may be eligible for down payment assistance worth up to 5% of the home's purchase price (up to $35,000) in the form of an interest-free, non-forgivable second mortgage. Meanwhile, veterans and active-duty service members in Florida who meet local income requirements can qualify for a lower-rate 30-year, fixed mortgage with several down payment assistance options through the Florida Salute Our Soldiers Military Loan program.

Florida down payment assistance programs

There are various programs available to assist with sealing the deal and making a down payment.

The Florida Homeownership Loan Program (FH LP) offers eligible homebuyers a non-forgivable second mortgage of up to $10,000 to cover down payment costs. Homeowners make monthly payments of $69.05 until the 15-year term ends, the home is sold, or the primary mortgage is paid off, whichever comes first.

The Florida HFA Advantage PLUS loan provides first-time buyers with up to 5% of the sale price for a down payment or closing costs. This amount is forgiven over five years at an annual rate of 20%.

Some Florida cities also offer assistance for first-time homebuyers.

Miami's first-time homebuyer program offers zero-interest deferred loans to eligible buyers who earn less than 80% of the area median income and purchase within the city, with a maximum home price of $451,000.

First-time homebuyers in Orlando can receive a forgivable loan of up to $45,000 through the city's down payment assistance (DPA) program. To qualify, buyers must make up to 140% of the area median income and the home price must be less than or equal to $481,176. The loan will only be forgiven if the buyer remains in the house for 10 years without renting or refinancing.

Tampa's Dare to Dream program provides first-time homebuyers with a deferred loan of up to $40,000, as long as they make no more than 140% of the area median income and have a credit score of at least 600. The maximum home price allowed is $350,000.

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