September 4, 2025
The numbers for 2025 continue to be consistently inconsistent, and the indicators from the TBBA’s mid-year report held up the uncertainty. In all candor, the report can be best categorized as another mixed bag. Led by Ali Wolf, Chief Economist for Zonda and NewHomeSource, the report concluded the market isn’t easy and probably won’t be for a while.
Ms. Wolf is not alone in that opinion. Many forecasters have characterized the downturn in the region as a correction after the market overheated during and immediately after the pandemic. The report indicated that the new home sales rate, a function of supply and incentives, went from 2.0 in 2015 to 5.0 in 2021 to 2.8 in 2025 which certainly sounds like a correction.
The good news is that the report continues to see Tampa Bay as an average market, while marking some other Florida markets as “slightly underperforming.” Those include Cape Coral/Fort Myers and Naples.
The bad news is that while the Federal Reserve may cut interest rates in September, that doesn’t ensure that mortgage rates will follow. In fact, mortgage rates actually spiked in December of 2024 after the third of three interest rate cuts from the Fed. The report advises preparing for interest rates between 6% and 7% for the foreseeable future.
The uncertain news comes from an economy that shows positives with incomes, consumer spending and the stock market, caution with housing starts and inflation and negatives with consumer confidence, industrial production, and the labor market. It’s all underscored by 60 percent of builders stating in a survey that demand is slower than expected and causing concern. The mid-term report also indicated that 71 percent of builders describing their land acquisition strategy as “cautiously moving forward.”
Why caution? Well, a different report from John Burns Research & Consulting helps tell the story. The report states that nationally, after two years of fierce competition, land demand has collapsed by nearly two-thirds. Only 28% of land brokers report strong demand in their markets, down from 76% just one year ago. A similar decline occurred in late 2022. And the report states that the change has shifted the negotiating power to land buyers but cautioned that they still must be patient.
Finally, if you want some purely good news, consider this: data from the Florida Realtors indicated a 2.8 percent year-over-year increase in single-family home sales in June, the first time since January. A Newsweek article stated that increase defies the recent downward trend in the state's struggling housing market.
The article attributed the shift to falling prices, noting that the median sale price of a single-family home in the Sunshine State was $412,000, down 3.5 percent from a year earlier, but still up a staggering 46 percent from 2020.
But Florida Realtors president Tim Weisheyer told Newsweek he believes consumers may be ready to accept new mortgage rates.
"Today's rates are still well below the 50-year average for a 30-year fixed-rate mortgage,” said Weisheyer, broker-owner of Dream Builders Realty and dbrCommercial Real Estate Services. “Buyers are starting to realize and accept that we're actually sitting in a normal interest rate environment, and that the value of investing in a home now outweighs waiting. Home prices haven't dropped significantly, their rent payments aren't building equity, and the cost of waiting keeps going up. So, the question becomes: if not now, when? That shift in mindset is pushing more people into the market."