Southwest Florida’s housing market is still working through a price correction, and it’s been a rough ride for sellers. Home prices in Punta Gorda have dropped 25.3% since July 2022, and North Port isn’t far behind, down 17.4%. Compare that to the rest of the country; U.S. home prices actually went up 1.9% over the same stretch.
For example, a single-family home in Venice, FL, sold for $565,000 in 2023. By then, the market was already cooling off. Buyers started gaining leverage, and Southwest Florida shifted into “correction mode.” Fast forward to early 2025, the owner listed that same house for $519,000. Four price cuts later, and a short stint off the market, it finally sold in December 2025 for $455,000. That’s a 19.5% drop from what it fetched just two years earlier. Still, that $455,000 sale is 38.7% higher than what the house sold for in 2017, back when it went for $328,000.
The pattern is apparent: Southwest Florida is one of the two weakest spots in the U.S. housing market. Only Austin, Texas, has seen a bigger drop. Since the 2022 peak, home prices are down 27.3% in Austin, 25.3% in Punta Gorda, 18.8% in Cape Coral–Fort Myers, and 17.4% in North Port–Sarasota–Bradenton. That Venice house sits squarely in the North Port–Sarasota metro, right where the pain is sharpest.
More numbers for the data crowd: In ZIP 34293 (where that Venice house is), single-family home prices are down 11.3% year-over-year and 21.5% from the 2022 high. That lines up with the 19.5% drop on the featured house. But since March 2020, prices in that ZIP are still up 37.3%—pretty close to the 38.7% gain for that specific property since its pre-pandemic 2017 sale.
This is not an average market; while U.S. home prices squeaked into 2026 up 1.9% over their July 2022 peak (according to the Zillow Home Value Index), North Port–Sarasota is still down 17.4% from that time.
Why the sharp reversal in Southwest Florida? It’s a mix of things. Home prices shot up way too fast during the pandemic, much faster than local incomes could support. The area had cheap land and low building costs, so construction boomed. But when the flood of retirees and out-of-state buyers slowed down, demand took a hit. Suddenly, prices had to stand on local incomes alone, and that wasn’t enough.
On top of that, a wave of new single-family and multifamily homes hit the market. Builders and landlords had to sweeten the deal with bigger incentives, which pulled buyers away from existing homes and cooled things off even more.
Bottom line: parts of Southwest Florida overshot, and now they’re correcting back to reality. There’s more to it. After the Surfside condo collapse in 2021, Florida rolled out stricter building safety rules, resulting in more inspections, more funds set aside for repairs. HOAs responded with hefty special assessments and higher monthly fees, especially for older coastal condos. That’s another layer of pressure, making the market even tougher for some owners.
Looking ahead, the big question is whether home prices in places like Punta Gorda, Cape Coral, and metro Austin have dropped enough to bring buyers and single-family investors back into the market. In Southwest Florida, inventory levels, measured in months of supply, still sit above the national average in many areas. But the surge in listings has cooled a lot over the past year. In fact, some parts of SWFL now show small year-over-year drops in active listings.
Experts projected argued that certain Southwest Florida markets faced a bigger risk of a home price correction. Moody’s Analytics backed this up, calling Punta Gorda “overvalued” by nearly 58%. Fast forward to today: after a real correction and some solid income growth, Punta Gorda’s “overvalued” metric has shrunk to just 9%, according to Moody’s. The correction in Southwest Florida has taken a lot of the downside risk off the table compared to where things stood a few years ago.
