Florida Chamber Warns Economic Growth at Risk as Retirees Flee High Costs

2026-01-17 economy

Tallahassee, Saturday, 17 January 2026.
With housing prices surging 51 percent, the Chamber warns Florida’s historic affordability advantage has vanished, threatening the state’s long-standing, migration-driven economic growth model.

The Erosion of the Affordability Advantage

The Florida Chamber of Commerce has issued a pivotal analysis regarding the state’s economic trajectory, identifying a critical erosion in the cost-of-living advantage that historically fueled the state’s population boom [1]. While Florida successfully attracted over 500,000 new residents between 2020 and 2022, the economic dynamics have shifted dramatically [1][2]. During the pandemic era, real estate prices in the Sunshine State surged by 51 percent, a figure that significantly outpaced the national average increase of 41 percent [2]. This rapid appreciation has fundamentally altered the retirement calculation, with the Chamber noting that the low cost of living Florida once boasted has waned, forcing budget-conscious retirees to look elsewhere [1].

Housing Costs and the “Retirement Trap”

The escalation in housing costs is particularly acute in areas traditionally favored by seniors. Between 2000 and 2024, Florida home prices rose more than in any other state, and by the end of 2025, the statewide median home price stood at $411,500 [1]. In Sumter County—home to the massive retirement community The Villages and a population with an average age of 68.4—the median home price reached $446,381 [1]. This places the cost of a home in this retirement hub 8.661 percent higher than the national median of $410,800 [1]. Compounding these capital costs, retirees are facing a sharp rise in carrying costs; insurance premiums have increased by over 30 percent since 2020 due to climate-driven losses, and property taxes have climbed 27 percent since 2019 [3].

The Shift Toward the “Southern Sanctuary”

This affordability crunch is driving a measurable demographic shift, often referred to as the rise of the “Southern Sanctuary” [4]. Data spanning 2013 to 2023 reveals that net migration of households earning $75,000 or less to Florida plummeted by 44 percent [1]. Similarly, the net migration rate for households headed by individuals aged 55 to 64 fell by 17 percent over the same period [1]. In 2023, Florida lost the highest number of households to states such as North Carolina, Texas, Georgia, Tennessee, and Alabama [2]. These destinations are attracting retirees by offering favorable tax structures without Florida’s premium price tag; for instance, Alabama exempts Social Security and various pensions from state income tax, while South Carolina offers similar tax breaks on Social Security [4].

Economic Headwinds and Future Projections

The slowing inflow of residents poses a tangible risk to Florida’s broader economy, which was valued at $1.76 trillion in the first quarter of 2025 [5]. Florida TaxWatch forecasts that daily net migration will decelerate significantly, dropping -23.861 percent from 922 people per day in 2025 to 702 per day by 2034 [5]. Consequently, real GDP growth is projected to cool, moving to 2.3 percent in 2026 and settling near 1.9 percent by 2034 [5]. As the state grapples with these headwinds, the unemployment rate is expected to tick upward, projected to rise from 4.0 percent in 2025 to 4.5 percent in the 2026–2027 period [5]. This data suggests that while Florida remains a powerhouse, the era of effortless, rapid growth driven by low-cost migration is transitioning into a period of more moderate, structurally constrained expansion.

Sources

Demographics Cost of Living