As the Southwest Florida housing market experiences a significant shift toward a buyer's market, industry experts urge potential sellers to act swiftly, especially those who purchased properties after 2020. This warning was highlighted during the Market Trends of Southwest Florida event held on March 20, 2025, where real estate professionals gathered to discuss evolving trends in the local market.
Denny Grimes, president of Denny Grimes & Team at Keller Williams Realty, noted that the transformation from a seller's to a buyer's market has been underway since the fourth quarter of 2023. “We’re actually now in a buyer’s market, and we’ve been in one since the fourth quarter of 2023,” he stated. “It kind of snuck up on us.” With a growing inventory of homes, he emphasized that the market is resetting, which bodes well for the area’s future. He expressed concerns that if housing prices continue to rise to unaffordable levels, sellers might struggle to find buyers in the long run. “If housing keeps going up to where no one can afford it, who are you going to sell it to?” Grimes asked.
Grimes also highlighted that home sellers who bought properties during the boom between 2019 and 2020 might have an advantage. “It’s called equity,” he explained. “Naples has an average of 90% equity growth from 2019 to right now.” This means many homeowners from that period are sitting on substantial profits. However, those who bought homes in 2021 or 2022 may want to think twice before selling, as they might not recoup their initial investment. “The market has not risen to absorb what you paid for,” he warned.
Using a sports analogy, Grimes compared the real estate market fluctuations to a sports team like the Kansas City Chiefs that can't always win the Super Bowl. “Sellers are going to be sorry if they don’t act soon versus later,” he stated, recalling how some homeowners who refused to sell in 2007 saw their property values plummet by 60% and took over a decade to recover. “It’s not the hurricanes. It’s not the cost of insurance. Our demand has not diminished. Our demand has diminished with our asking price.”
During the same event, Justin Thibaut, president and CEO of LSI Companies, spoke about recent land acquisitions in the region, including a noteworthy $620 million deal concerning an active rock mine located off Alico Road. He explained the importance of such deals, given the upcoming infrastructure projects that will require significant material supply. Thibaut, like Grimes, expressed expectations for falling housing costs amid increasing inventory levels. “When it’s time to refinance, are we going to see lower sale prices?” he pondered.
Thibaut also discussed the challenges faced by builders aiming to keep new home prices competitive. In places like Lehigh Acres, builders are working hard to offer new three-bedroom, two-bath homes for under $300,000, a tough task considering current market dynamics. He noted, “It’s become very difficult to deliver what’s considered an affordable home.”
Amid changing market conditions, Babcock Ranch stands out as the region’s fastest-growing community, showcasing innovative building practices. “D.R. Horton’s using Bamcore product, which is a panelized product, which is a sustainable material,” Thibaut explained. The adoption of advanced construction technologies like robotic assistance for laying concrete blocks has made Babcock a model of modern housing development. The community pulled 1,500 permits last year and has delivered 6,000 homes as part of its ongoing growth.
Matt Simmons, managing partner and property appraiser at Maxwell, Hendry & Simmons, also weighed in on the evolving market. He noted that after a period of an abnormal market dictated by external factors, the current state feels like a return to normalcy. Simmons discussed the sale of the former Sears building located at the Edison Mall in Fort Myers, which was bought on November 18, 2024, for $5.8 million by Edison Florida Real Estate LLC for 147,847 square feet of space. He remarked, “Forty dollars a square foot gets you nothing in any asset class.” This price raises questions about the broader strategy needed to revitalize aging retail spaces.
Highlighting a crucial element in retail success, Simmons stated that the region needs more residential complexes nearby to create consumer demand. Areas like Cape Coral, however, are experiencing tremendous growth and redevelopment. “Cape Coral is absolutely on fire,” he described, praising the ongoing transformations in downtown Cape Coral along the Cape Coral Parkway.
Overall, the message from the Market Trends event indicates a proactive approach for home sellers in Southwest Florida. As the market reshapes itself, both buyers and sellers will need to adapt to the evolving landscape of real estate.
