South Florida’s real estate market is facing a noticeable reset. After the pandemic triggered a buying frenzy that drove prices sky-high and cleared out inventory, the pace is finally slowing and boy, locals are getting excited for this swift recovery. Sellers now outnumber buyers by the widest margin seen in over a decade, and while asking prices remain elevated, there are clear signs of softening, especially in the condo market.

Condo sales in areas like Miami-Dade and Broward have declined significantly. This drop is tied to stricter regulations and required building inspections that emerged in the wake of the Surfside tragedy. Many older coastal buildings are now undergoing mandatory structural reviews, which are exposing costly issues and driving up HOA fees. These unexpected costs are deterring buyers and forcing some owners to sell more urgently than anticipated. Every buyer is terrified of HOA boards, monthly fees are just the tip, but unexpected expenses from corrupt boards has been a hot topic.

Affordability is becoming a growing concern across the board. Mortgage rates remain high, hovering near seven percent, and home insurance costs in Florida have become some of the highest in the country. Many homeowners are now paying over six thousand dollars annually for insurance alone, making monthly costs significantly steeper. As a result, even modest homes have moved out of reach for average buyers. In Miami and Palm Beach counties, starter homes are now frequently listed around one million dollars—a figure that would have seemed extreme not long ago.

Despite these challenges, the luxury segment remains strong. Wealthy buyers, many of whom pay in cash and are less impacted by interest rates, continue to invest in South Florida’s most exclusive properties. Multi-million dollar listings, including a penthouse on Fisher Island and sprawling waterfront estates in places like North Bay Road, are still attracting attention. This upper tier of the market operates with its own rhythm, somewhat insulated from broader economic pressures.

The overall market is shifting from the overheated chaos of the past few years to something more balanced. Inventory levels are climbing, bidding wars have cooled, and buyers have more negotiating power than they’ve had in recent memory. It is not a crash, but rather a slow recalibration. The future direction will likely hinge on whether mortgage rates come down and how the state manages the growing insurance and maintenance burden on homeowners.

For now, South Florida real estate remains active but uncertain. There is still interest and movement, but it’s more cautious and calculated. The sunshine is still here, but the market is learning to live with a few more clouds.