FLORIDA'S HOUSING MARKET IS FALLING APART

The first quarter of 2025 has wrapped up, and the big question on everyone's mind is this: Is Florida’s housing market falling apart? Depending on who you ask—or what headline you’ve seen—it may sound like the sky is falling. But let’s take a closer look at what’s really happening on the ground, especially here along Florida’s Gulf Coast.

Before we dive in, let me just say: Headlines do more to terrify than to clarify. I’m not here to spread panic or make dramatic comparisons to 2008. That’s not helpful, and frankly, it’s not accurate. What I am here to do is walk you through what’s going on right now in Sarasota and Manatee Counties—and what it means for both buyers and sellers.

Inventory Is Up. Way Up.

Let’s start with the facts: At the end of Q1 2025, Sarasota and Manatee Counties have over 13,000 homes on the market. That’s 24% more than this time last year—and a whopping 50% more than in 2023.

What does this mean? Contrary to clickbait headlines, it’s not a market crash. But it is a significant shift. For the first time in years, buyers have the upper hand. Homes are more affordable, negotiations are back on the table, and the frenzy of bidding wars is behind us.

Especially for out-of-state buyers—from places like Michigan, Massachusetts, or New York—this is a golden window. Many are selling their current homes quickly and near list price, then coming to Florida with more buying power than ever.

Why So Much Inventory?

There are five key reasons we’re seeing such a surge in homes for sale:

1. Pandemic Migration Reversal: Florida saw record-breaking migration during COVID. Now, some of those new residents are heading back home.

2. Delayed Sellers Are Catching Up: Seasonal homeowners who held off during the market frenzy are now ready to list.

3. Rising Ownership Costs: Insurance and HOA fees have gone up significantly, making it harder for some to justify staying.

4. Airbnb Saturation: Investors who bought short-term rentals are seeing lower returns—and choosing to cash out.

5. New Construction Boom: Builders are flooding the market with new homes, making it harder for resale listings to compete. Builders can drop prices, offer incentives, and adjust quickly—putting pressure on traditional sellers to follow suit.

Yes, Prices Are Dropping

This shift in supply is affecting home values. As predicted, average sale prices are down about 5% year over year, with the current average in Sarasota-Manatee at $601,000, compared to $632,000 this time last year. And it may drop a bit further—possibly another 5%—as we head into the slower summer and fall months.

That sounds alarming until you realize that from 2020 to 2022, home prices surged 67%. Even after recent corrections, prices are still in line with where they were in 2022—a reality check more than a crash.

For Sellers: Time to Adjust

Sellers need to be realistic. What your neighbor’s home sold for six months ago may no longer apply. Builders are adjusting prices monthly—and resale sellers must do the same to stay competitive.

If you bought in 2023 or 2024, it’s likely your home has dipped in value. And yes, that’s frustrating. But like the stock market, real estate is a long-term investment. Sometimes you gain, sometimes you wait it out. The good news? Most homeowners still have equity, and over 54% of homes in Florida are owned outright. That means foreclosures aren’t likely to flood the market and tank prices further.

For Buyers: The Opportunity Is Now

This is the most buyer-friendly market we’ve seen in over a decade. Negotiations are back in play, with buyers regularly scoring 5–13% off asking prices—even on well-maintained homes in great neighborhoods. Builders are also offering incentives, from price cuts to design credits.

And while it’s true that some homes are still selling quickly—especially if they’re priced right and in desirable areas—the window for deals is open. If buying is right for you, now is a smart time to act, especially with interest rates expected to ease in the months ahead.

Final Thoughts

There’s a lot of fear out there right now, and that’s understandable. But as Warren Buffett famously said:
“Be fearful when others are greedy, and be greedy when others are fearful.”
For many buyers, now is the time to lean in—not back away.

If you're thinking about making a move, whether buying, selling, or just exploring your options, I'm here to help you navigate the Florida market with confidence and clarity.

📞 Lisa McBride – Sarasota Neighborhood Experts
Let’s talk about what’s possible for you in 2025.