Market Overview

As we step into the second half of 2025, the real estate market continues to evolve nationally and locally in Southwest Florida. New construction remains a hot topic, with builders offering generous incentives, lower prices, and mortgage rate buy-downs to attract buyers. Meanwhile, affordability challenges persist due to high home prices and steady mortgage rates, creating a more cautious buyer pool. The Southwest Florida market shows signs of price softening, longer days on market, and shifting dynamics between buyers and sellers.

New Construction Offers Buyers a Strong Advantage

Builders across the country and in Southwest Florida are offering attractive incentives on new homes, including discounted prices and mortgage rate buy-downs. Many builders also own the mortgage and title companies, giving them flexibility to structure favorable deals for buyers. With nearly 10 months of inventory nationally and Cape Coral showing over 20% of listings as new construction, it's a prime time to consider buying new.

Price Adjustments Signal Market Correction, Not Collapse

Nationally and locally, home prices are no longer seeing double-digit appreciation. While some markets, especially in the Sun Belt, are experiencing mild depreciation, others remain stable or slightly up. Southwest Florida is witnessing mixed trends—Fort Myers saw a 9.2% price decline year-over-year in June, while Marco Island stayed flat.

Seller-Buyer Imbalance Returns to Favor Buyers

Charts reveal more sellers than buyers in the current market—reversing the ultra-competitive climate seen in 2020–2022. This shift has increased days on market and encouraged price corrections and seller concessions. Buyers now face less competition and more opportunity to negotiate.

Affordability and Mortgage Rates: A New Normal

Mortgage rates are holding steady around 7%—the historical average—despite ongoing hopes for a major drop. Experts now predict rates will remain elevated through the third quarter of 2025, keeping affordability a key challenge. High home prices combined with these rates mean monthly payments are still a stretch for many buyers. Builders are responding with incentives like mortgage rate buy-downs and lower closing costs, helping ease the financial pressure for those entering the market.

Key Takeaways:

The July 2025 market shows signs of transition and opportunity, with national builder incentives and local price adjustments creating favorable conditions for buyers. In Southwest Florida, growing inventory and a more balanced market are reshaping real estate dynamics. Whether buying or selling, now is the time to act strategically—connect with the Bartos Group and TVF Mortgage to navigate your next move with confidence.