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By Hugh Cameron
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Home values are sinking across many U.S. metros, but Florida’s sluggish housing market continues to stand out amid an ongoing correction from its pandemic-era boom and as new affordability issues weigh down buyer demand.
In its recent analysis of the country’s 100 largest metros, Realtor.com found that Florida accounted for six out of the top 10 where median home prices have fallen the fastest year over year.
"Florida has seen significant market cooling and strong inventory growth, which has driven prices down as the supply of homes for sale outpaces demand," wrote Joel Berner, senior economist at Realtor.com. "The ancillary costs of homeownership in Florida—like insurance, maintenance, and HOA [homeowner association] fees—are also high and growing, which keeps buyers sidelined."
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Why It Matters
Supply constraints and homeowners "locking in" during the low-mortgage pandemic era, among several other factors, have pushed average prices higher and the prospect of homeownership out of reach for more Americans.
However, rather than a healthy correction, the drop in prices across Florida and other states reflects a decline in demand fueled by rate pressures, rising secondary costs and other factors. This has created difficulty for sellers, now competing for a smaller and more cost-conscious pool of buyers, many of whom are pulling listings out of frustration or proving unable to match tighter budgets.
What To Know
The North Port-Bradenton-Sarasota area in southwest Florida came in at the top of Realtor.com’s rankings, with median listing prices having dropped 8.6 percent to $478,800 over the past 12 months.
The remainder of the top 10 was filled with Florida metros, as well as areas in California, Colorado and Texas.
2. Cape Coral-Fort Myers, Florida
3. Austin-Round Rock-San Marcos, Texas
4. Lakeland-Winter Haven, Florida
5. Stockton-Lodi, California
6. Deltona-Daytona Beach-Ormond Beach, Florida
7. Tampa-St.-Petersburg-Clearwater, Florida
8. Jacksonville, Florida
9. Denver-Aurora-Centennial, Colorado
10. San Francisco-Oakland-Fremont, California
Realtor.com’s analysis revealed several pressures on prices in these metros, including soft demand, ballooning inventory levels, still-elevated mortgage rates and the high “ancillary costs of homeownership.”
Niall Phelan, a Florida real estate agent and co-founder of the Oasis Group Sarasota/Lakewood Ranch, cited these alongside more Sunshine State-specific factors when discussing the issue with Newsweek.
“A lot of people who bought homes to work remotely down here are being called back to the office,” Phelan said*.* “So, their homes are going up for sale. That's definitely been a big factor this year and last year.”
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In addition, Phelan said that many Canadians—who account for between 15 and 20 percent of his buyers—are now putting homes up for sale due to the current period of strain in U.S.-Canada relations.
“Canadians make up a huge portion of the buying population here on the west coast of Florida,” he said. “When they start to sell, and also not purchase, it’s a significant loss in the purchasing market.”
Realtor.com also noted that many of the areas that are seeing some of the sharpest decreases could be considered “pandemic-era boomtowns,” where demand and prices inflated heavily in 2021 and 2022 and laid the groundwork for the current pullback.
As for what might turn things around in Florida and nationwide, Phelan said continued moderation in mortgage rates—ideally to under 5 percent—would spark another period of buyer interest, and that prices had effectively “bottomed out” along the west Coast of Florida.
What People Are Saying
Real estate agent Niall Phelan told Newsweek: “We're starting to see inventory move. Homes that have been on the market for a long time are starting to sell. And I think that's a combination of a little bit of moderation in rates, but also maybe sellers being a little bit more realistic about the pricing they're looking for in their homes.”
Real estate agent Ron Myers, quoted in Realtor.com’s analysis, said: “Parts of Sarasota saw home prices shoot way up during the [COVID-19] pandemic. People were moving fast, bidding high, and many bought sight unseen just to lock something down. Those prices weren’t really sustainable long-term. Now that interest rates are up and monthly payments are higher, demand has slowed."
What Happens Next
Nationally, home prices are expected to continue on their upward trend in 2026, though Realtor.com forecasts that Florida and California will continue to see these fall in several areas next year.
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