The story everyone keeps repeating is that there are fewer sellers than last year. That is not what is actually happening. The sellers are still there. They have just quietly turned into accidental landlords, and that shift is reshaping the entire market.
The rise of the accidental landlord
Here is the chain reaction. A homeowner needs to sell, but they can't get the price they want, and they're sitting on a 3% mortgage. To move, they'd have to give up that rate and take on a new loan in the sixes or sevens. The math doesn't work, so instead of selling, they rent the house out.
One owner doing that is a footnote. But when it stacks month after month, you get a glut of rental supply hitting the market, which pushes rents down. The houses didn't disappear. The owners just became landlords they never wanted to be, and they pulled their homes off the for-sale market for the same reason buyers can't buy: the numbers no longer make sense.
The market didn't slow down. It froze.
This is why the turnover ratio, the number of homes sold per thousand homes, has fallen to one of the lowest levels in decades. People can't get the price they want, and they can't afford to move up to the next house, so they stay put. We wrote about this dynamic in why the housing market froze and in where Jacksonville's inventory actually went.
This is no longer a fringe take. Even mainstream voices are calling roughly three-quarters of U.S. homes unaffordable and describing the most unrealistic real estate market in a hundred years. When you run zero-interest-rate policy for years, you inflate assets. When rates rise, those asset prices come under pressure. It doesn't hit every area at the same time, but the financial gravity is real.
Prices are above the 2006 peak, and the case for mean reversion
Adjusted for the inflation we've lived through, U.S. home costs now sit above the 2006 bubble peak. That is the setup for some mean reversion over the next few years.
My internal models point to a 32% to 41% decline in prices over the next few years. This is my forecast, not a promise. Real estate is illiquid, so it does not happen overnight; it plays out slowly.
The pain shows up first in the markets that ran the hottest, the Sun Belt: Florida, Texas, Colorado, Arizona. Those areas saw 40%-plus appreciation on the back of pandemic-era speculation and migration. The Northeast, which under-built and saw outflows, is adjusting from the other direction.
The real problem: wages never kept up
Americans didn't stop working hard. Over recent decades income rose roughly 10x, but the cost of shelter rose about 17x, college about 16x, and healthcare about 42x. Wages simply didn't keep pace with the cost of living.
That is why so many households feel stretched. A large share of Americans now live paycheck to paycheck, consumer confidence keeps sliding, and delinquencies on credit cards, auto loans, and student loans are rising across the board. A maxed-out consumer has a much harder time qualifying for and carrying a mortgage, which feeds right back into those frozen turnover numbers. The affordability gap tells the same story: in 1985 a home cost about 3.5x median income; today it's closer to 5.8x, and in some areas as high as 7x.
Rent vs. buy: why renting is winning right now
The consumer has options, and that is the single biggest thing a seller is competing against. In today's market, buying can run up to 50% more per month than renting a comparable home, before you add repairs and maintenance. You might rent a house for $1,700 that would cost a $3,000 payment to own.
If you're going to buy, you need to plan on staying long enough for the economics to work. The fastest way to see your own numbers is to run them: we built a free rent vs. buy calculator where you plug in your rent and it shows what that translates to as a purchase. A lot of people are surprised by the result.
The Sun Belt fire-sale map
Here's what's happening on the ground. The demand that flooded the Sun Belt from 2020 to 2022, remote workers relocating, drove prices to records. Many who bought from 2022 to 2024 are now underwater, and when a job loss, a return-to-office, or a life event forces a move, those homes become fire-sale inventory. With transaction costs around 10% to buy and sell, the margin for error is thin.
In Florida you can see the stress concentrated in the big growth markets, Jacksonville, Orlando, Tampa, and Fort Myers, with Miami starting to feel some of it. Every market is hyper-local, so a metro headline is never a price for a specific home, which is exactly why working with a local agent who tracks your zone matters.
The new-construction glut and builder buydowns
Be especially careful buying new construction late in a master-plan's phasing. When there are more phases coming, builders are handing out heavy incentives, often buying down your interest rate rather than cutting the price, because they can purchase rate buydowns in bulk far cheaper than reducing the sticker. The "housing shortage" narrative also deserves scrutiny: by stage of construction, the for-sale new-home pipeline is large, in some measures larger than during the financial crisis.
In Jacksonville specifically, we are overbuilt on multifamily relative to current demand, and projects that are already financed have to finish. The result is a market where rents are falling, prices are falling, and rents are falling faster, which keeps renters renting. For more on the trade-offs, see new construction vs. resale and the live numbers on our Northeast Florida housing statistics page.
What this means if you're buying or selling in Florida
If you're selling, your real competition is the rental market and a pile of builder incentives. Price to the market that exists today, not last year's comp, and lean on marketing and condition to stand out. If you're buying, run the rent-vs-buy math honestly, plan to stay put long enough for it to pay off, and be cautious about late-phase new construction. Either way, the metro headline isn't your answer, the right number comes from recent comparable sales in your specific neighborhood.
Mortgage rates are the swing factor. Forty years of falling rates drove the bulk of the appreciation we've seen, and every roughly 1% move higher cuts buyer purchasing power by about 10%. If rates stay high or climb, expect more price cuts, more listings, and more buyers choosing to rent.
Track the latest local numbers on our Jacksonville housing market page, and if you want a straight answer on your specific situation, talk to our founders or call (904) 351-6461.
This article summarizes Jon Brooks's market commentary and includes his personal forecasts and opinions. It is for general informational purposes only and is not financial, investment, legal, or tax advice. Market projections are inherently uncertain and are not a prediction for any specific property. Consult a licensed professional about your situation.