Florida's southwestern coast sees steepest home price drops since 2011

Florida's southwestern coast, renowned for its affluent communities and appeal to retirees, is experiencing significant declines in home prices. This downturn marks the steepest drop since 2011.

In areas like Sarasota and Punta Gorda, property values are plummeting at rates reminiscent of the post-recession period over a decade ago. While most regions in the United States see rising home prices, certain Southeastern metropolitan areas in Florida are diverging from this trend.

According to data from the National Association of Realtors (NAR), Punta Gorda saw a 6.5% decrease in home prices this past quarter, bringing the median price down to $350,000. The North Port-Sarasota-Bradenton area experienced a 5.8% decline, reducing median prices to $485,000. Cape Coral-Fort Myers also reported a 3.7% drop, adding to earlier decreases this year.

Economist Lawrence Yun from NAR attributes these market pressures to increased housing supply, high insurance premiums, and rapid construction growth in recent years. Tony Barrett, president of the Realtor Association of Sarasota and Manatee, emphasized that hurricanes have exacerbated these challenges.

Recent storms not only caused damage but also deterred potential buyers, delaying transactions and diminishing confidence in the market. In particular, Hurricane Debby hit the coast in August followed by Hurricanes Helene and Milton later in the fall which contributed to widespread destruction.

As insurance costs rise and investors retreat from the market, activity has slowed significantly. The NAR reports that Punta Gorda had an annual price decrease of 6.5%, resulting in a median price of $350,000 for Q3.

This trend is not unique to Florida; San Antonio, Texas and Durham, North Carolina—cities previously experiencing real estate booms with over 20% gains two years ago—are now undergoing similar price corrections.

Nationally, home prices rose by 3.1% during the third quarter with a median price reaching $418,700; however, growth remains sluggish as affordability issues persist across many regions.