If you’ve been following housing headlines lately, you’ve probably noticed how confusing the narrative has become. One article says prices are falling. Another says inventory is tight. Buyers feel cautious. Sellers feel unsure. And yet, homes are still selling.
So what’s actually happening in the Tampa Bay housing market?
November’s data tells a story that isn’t about a crash or a boom — it’s about transition. A market recalibrating after several years of extremes, driven by affordability, buyer behavior, and a fundamental change in how consumers search for and evaluate homes.
Let’s walk through the real story behind the numbers.
The most important change in today’s housing market isn’t inventory or mortgage rates. It is the unfortunate absence of first-time buyers.
According to the National Association of Realtors, first-time buyers accounted for just 21% of all home purchases, the lowest share in more than 40 years! At the same time, the average age of a first-time buyer has climbed to 40, up from about 32 before the pandemic.
This matters because first-time buyers are the foundation of the housing market. They fuel entry-level sales, which allow move-up buyers to sell, which in turn supports downsizers and long-term sellers. When that group slows, the entire system feels it.
Importantly, first-time buyers haven’t disappeared because they lost interest in homeownership. They’ve been pushed to the sidelines by affordability constraints, not by lack of demand.
Let’s look at pricing, because this is one of the most confusing pieces. With the increase of inventory and lack of demand, you would think sellers are slashing prices, but that is not what is happening.
In November:
Those numbers sound dramatic at first glance. But the underlying data tells a very different story.
The list-to-sale price ratio remains at 96%, unchanged from last year. That means sellers are still achieving close to their asking prices. In other words, sellers are adjusting pricing, but they are not accepting steep discounts.
So what’s actually pulling prices down?
The answer is the mix of homes selling.
In Pinellas County, the median sales price in November was $440,000, down from a spring high of $479,000. There were 726 single-family home sales, and exactly half of them sold for $440,000 or less.
Lower-priced homes are making up a larger share of sales. When that happens, the average price naturally declines.
If you look in areas like Clearwater, Largo, and Seminole versus St. Petersburg, the average price is 15% less expensive.
In Hillsborough County, you can buy a home in Brandon for 43% less, on average, than in Tampa!
This is why the current market should be described as a shift, not a collapse.
From 2021 through 2024, the housing market followed a classic K-shaped pattern.
Higher-income households, luxury buyers, and cash purchasers surged ahead, while first-time and middle-income buyers were pushed to the sidelines. This divergence didn’t fully show up in headlines right away because K-shaped data typically lags by 18–24 months.
In Tampa Bay, October and November’s data show early evidence that this divide is softening. The dominance of higher-end buyers is easing, and affordability-driven purchases are regaining traction.
This is a healthy signal for the long-term stability of the market.
A major reason prices have remained stable is something many buyers and sellers don’t realize is happening: homes are being pulled off the market instead of repriced aggressively.
Nationally, an alarming number of homes are being pulled off the market. Nearly 85,000 homes were delisted as of September — a 28% increase year-over-year.
Locally in Tampa Bay:
Today’s sellers often have:
Rather than accept an offer they’re unhappy with, many choose to wait.
This behavior tightens inventory, prevents sharp price declines, and keeps Tampa Bay in a seller-leaning market, with just 4.5 months of supply.
Prices haven’t crashed because sellers still have options.
While inventory remains tight, buyer demand hasn’t disappeared. It has, however, gone dormant as many buyers sit waiting for affordability to recover.
This is known as shadow demand: buyers who want to buy, are financially qualified, but cannot justify the monthly payment yet.
Mortgage rates climbed fast in 2022 and peaked in 2023. The good news? They’ve eased back down.
That shift created severe payment shock, especially for first-time buyers.
Life didn’t stop. People continued to get married (and divorced), grow families, relocate to for jobs, and outgrow rentals. The need to move continued to build, but the ability to move wasn’t a reality.
That’s why every small dip in mortgage rates triggers a spike in applications. In September, after the Fed’s first rate-cut announcement, mortgage applications jumped nearly 30%, according to the Mortgage Bankers Association.
That’s shadow demand revealing itself — and it’s one of the key reasons many analysts believe 2026 won’t be a frenzy, but a slow, steady release of buyers who’ve been waiting on the sidelines for years.
One of the most important shifts in the housing market has nothing to do with pricing or inventory. It has to do with how buyers search for homes.
A recent Realtor.com survey found that 82% of consumers now use AI tools to research housing, affordability, and market conditions.
Buyers are no longer just browsing listings. They are using AI to:
This matters deeply for sellers.
Homes today must pass an AI filter before they ever reach an emotional decision point. If pricing, condition, or affordability doesn’t make sense on paper, potential buyers will pass on your property without seeing it.
For sellers, this means transparency, accurate pricing, and thoughtful positioning matter more than ever.
Affordability remains the biggest challenge in Tampa Bay, but there are early signs of improvement.
According to S&P Global, Florida had one of the lowest homeowners’ insurance rate increases in the country in 2024 — around 1%, compared to roughly 10% nationally.
Property tax relief proposals are also under discussion at the state level, particularly for primary homeowners and working families. While these changes take time, they point toward a more stable long-term cost environment.
According to economists at Zillow, the national housing market is expected to settle into a healthier and more balanced state in 2026. Zillow’s forecast predicts that U.S. home values will rise modestly (about 1.2%) next year after prices have been relatively flat in 2025. It is also forecasted that existing home sales will increase as pent-up demand returns and affordability gradually improves.
Mortgage rates are projected to stay above 6%, so buyers won’t likely see a return to pandemic-era lows, but slightly improved affordability and more inventory could bring both buyers and sellers back into the market.
So what’s the real takeaway from November’s numbers?
This is not a market falling apart.
It’s a market rebalancing.
Prices have softened but stabilized.
Inventory is tight but manageable.
Buyers are cautious but engaged.
Sellers are patient, not desperate.
AI is reshaping how decisions are made.
Most importantly, the buyers who disappeared haven’t given up — they’re preparing.
When affordability, confidence, and rates align, that demand will return.
Understanding the “why” behind the numbers matters more than ever.
The Tampa Bay housing market isn’t broken. It’s evolving.
When you understand today’s dynamics, especially how buyers are researching and deciding, you will be in the best position to buy a home or sell a home.
If you’d like a personalized breakdown of how these trends apply to your situation, or guidance on preparing a home for today’s AI-driven buyers, we’re here to help. We are constantly studying the market and positioning our sellers for this evolving real estate market.