If Zillow’s latest housing market forecast is accurate, some of Florida’s most scorching real estate markets may be in for a mild cool-down. According to their report, 24 cities across the Sunshine State—think Tampa, Orlando, Cape Coral, and North Port-Sarasota—could see price drops by early 2026.
For the average homeowner, this might spark concern. For the savvy investor, maybe opportunity. But for real estate appraisers, this signals something bigger: the need to recalibrate how we value homes in a shifting climate.
Why Florida’s Market May Be Cooling
The pandemic-era real estate boom turbocharged prices across Florida. Low interest rates, remote work, and a surge in out-of-state migration sent demand through the roof. But now, with mortgage rates still elevated, inflation lingering, and affordability stretched thin, some of that demand is softening.
We’re also seeing a classic case of supply catching up to demand. Florida has been building—fast. But even with cranes in the sky and permits being pulled at record pace, the buyer pool is thinning, and sellers are no longer commanding automatic bidding wars.
What This Means for Appraisers
Traditionally, appraisers lean on comparable sales from the past six to twelve months. But in a market potentially heading south, yesterday’s comps may not reflect tomorrow’s reality. That’s where forward-looking valuation practices come into play.
Appraisers need to watch local inventory trends, days on market, price reductions, and buyer incentives. Is that beautiful four-bedroom still fetching top dollar, or are concessions creeping in? Are we seeing price plateaus, or are appraisers noticing a dip in contract prices versus closed sales?
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What Homeowners and Investors Should Do
If you own property in one of these 24 flagged cities, now is a great time to consider a valuation update. Whether you’re thinking of selling, refinancing, or just planning ahead, a current appraisal can help you understand your equity position—and your risk.
Investors, too, should reassess strategies. In softening markets, due diligence is king. Look for appraisers who can provide After Renovation Values (ARVs), rent range analyses, and localized market insights that go beyond basic sales comps.
The Bottom Line
Zillow’s forecast isn’t the end of the world—it’s a warning light. And for real estate professionals and property owners who pay attention, it’s a chance to adjust before the market does it for you.
Florida’s sun may still shine bright, but when the forecast calls for clouds, it’s best to carry an umbrella—and a well-prepared appraisal report.
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