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How a Ron DeSantis presidency would affect the state's housing market
May 25, 2023
How a Ron DeSantis presidency would affect the state's housing market Los Angeles
By   Clare Trapasso
  • City News
  • Housing market
  • housing policy
  • housing issues
Abstract: Florida Governor Ron DeSantis is probably best known these days for his "war on corruption". However, his housing policies have not attracted as much attention.

After months of rumours fuelling his campaign, DeSantis officially announced his candidacy for the US presidency on Wednesday. If he takes the Republican nomination from real estate mogul and former President Donald Trump and wins the election in 2024, what does this mean for the housing market? For now, Trump has a considerable advantage among likely Republican voters, and Realtor.com® has researched the second-ranked Republican contender's housing-related priorities during his four-plus years as governor of the Sunshine State for clues.


"His experience as governor of Florida has certainly exposed him to the housing market and its problems," said Sean Slater, director of the Institute for Economic Forecasting at the University of Central Florida in Orlando." He is very familiar with the housing shortage that plagues the state."


Florida experienced tremendous growth during the COVID-19 pandemic as companies expanded and large numbers of people moved to the Sunshine State. It was the fastest growing state in the U.S. last year, according to the U.S. Census Bureau. According to Realtor.com, the median listing price of a home in Florida soared 42 per cent from April 2020 to April 2023, to approximately $468,000. Rental prices have also spiked across the state during the pandemic.


This year, DeSantis passed bills aimed at creating more housing, providing assistance to first-time homebuyers, as well as restricting international buyers from certain countries from purchasing real estate in Florida. The government has also responded to the devastation caused by hurricanes and floods by introducing reforms to Florida's property insurance industry.


The legislature has also been forced to confront the state's affordability challenges. For years, the state has typically reallocated funds from its Affordable Housing Trust Fund to other projects. in 2021, the legislature agreed to spend one-third of that money on housing and the rest could be used for other priorities.


Democrats have slammed the practice of diverting that money from housing during such a severe real estate shortage.


DeSantis and Trump will face plenty of competition from other Republicans vying for the nation's top job. Former South Carolina Governor Nikki Haley announced her candidacy in February. South Carolina Senator Tim Scott (R) joined the race this week, while former New Jersey Governor Chris Christie (R) is also expected to enter the race. New Hampshire Governor Chris Sununu and former Vice President Mike Pence are also likely to run.


Whoever wins the 46th presidency - from either side of the aisle - will face significant challenges in addressing the housing crisis.


"It's going to have to be a concerted effort at all levels of government," Snaith said." We need to help speed up the process of developers moving from paper to getting these housing units on the ground."

 How a Ron DeSantis presidency would affect the state's housing market

In March, DeSantis signed an affordable housing plan that invests more than $700 million to provide low-interest loans to developers building workforce housing in Florida, down payment and closing cost assistance for first-time homebuyers, and redevelopment of unused properties near military installations.


The Living Places Act is also expected to bypass local zoning boards, building height requirements and local density regulations, making it easier to convert commercial buildings into housing.


Ken Johnson, a real estate economist at Florida Atlantic University in Boca Raton, said that while replacing local authorities and zoning regulations could lead to strains on local infrastructure - such as more traffic, school congestion and other growing pains - the housing shortage "trumps" those concerns.


"This will start to increase the supply of housing fairly quickly. We just need to build units now," Johnson said." We're still in a rental crisis here."


He was less enthusiastic about the $100 million provided for down payment and closing cost assistance. The money will be used to fund the Florida Hometown Heroes Housing Program, which the governor announced last year. The programme is open to eligible first-time homebuyers who work in key industries such as law enforcement, firefighting, education, health care and child care, as well as active duty military or veterans.


"They don't have enough money behind them to make an impact," Johnson said.


The Living Places Act also prohibits townships and cities from establishing rent controls.


According to the National Low Income Housing Coalition, Florida lacks about 444,000 affordable rental units available to very low-income renters.


"It's more like pocket change than a real substantive solution to the problem," says Jack McCabe, who runs a housing consulting firm of the same name in south Florida." 711 million seems like a lot of money, but the truth is it could take billions and billions of dollars to correct the problem."


Last week, DeSantis signed a bill that bans many Chinese nationals who are not legal residents of the United States from buying real estate in Florida. The bill also prohibits citizens of six other countries - Russia, Iran, North Korea, Cuba, Venezuela and Syria - from buying farmland located within 10 miles of military sites and critical infrastructure.


In addition, as of July 1, the new law will require some Chinese nationals to register with the Florida state government any real estate they already own and any real estate they purchase.


The law has been criticised by Democrats, Asian American leaders and some real estate professionals.


"This law is very restrictive," said Dan Lionetta, president of the Greater Jacksonville Chapter of the Asian American Real Estate Association. He is also a mortgage lender with Movement Mortgage." We certainly don't approve of this law and don't approve of anyone from any country being restricted in their real estate purchases."


Johnson, a real estate economist, believes such a bill "distorts" the market by dictating who can and cannot buy.


"It will have a negative impact on prices, although I think it will be negligible," Johnson said." We're just cutting back on demand for real estate.


Last year, DeSantis signed a Republican bill to shore up Florida's property insurance system because many companies have gone out of business and others have fallen on hard times due to widespread damage caused by storms and floods. The bill raises fees for some homeowners, while providing tax rebates for residents affected by hurricanes Ian and Nicole. It will also force some homeowners to stop accepting insurance from state-established insurers.


As a result, many Floridians expect their already high flood insurance premiums to double this year.


"Many people are being forced to sell their homes and move," said McCabe, a housing consultant.


However, the governor has also signed bills into law to give homeowners a break. One of the bills states that insurance companies cannot deny coverage to homeowners if their roof is less than 15 years old. Following the Surfside condominium collapse, buildings over three storeys must be inspected after 30 years and then every 10 years for an additional inspection. Buildings within three miles of the coastline must begin receiving inspections after 25 years.


The governor also approved $150 million last year for grants to homeowners who want to retrofit their homes to be more hurricane-resistant.


"The overall impact [of a DeSantis presidency] is hard to say right now," Johnson said." It's a toss-up."

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How a Ron DeSantis presidency would affect the state's housing market