Sarasota, Manatee vacation-home frenzy fades, signaling economic shift

The Sarasota-Bradenton real estate market has seen a dramatic pullback in vacation and second-home sales, suggesting the pandemic-era buying spree is over and consumers are holding off on big-ticket discretionary purchases.

What was once a “feeding frenzy” of out-of-state buyers snatching up second homes or vacation properties has slowed due to higher mortgage rates, soaring insurance costs and growing uncertainty about the broader economy, economists and some local Realtors told Suncoast Searchlight. 

Second-home purchases in the North Port-Bradenton-Sarasota metropolitan area plunged 67% between 2021 and 2025, according to a recent study by SellMyTimeshareNow, a global timeshare resale and rental organization. The report analyzed nationwide vacation home purchases financed with a mortgage. 

Although the decline was only slightly steeper than the national average, the North Port-Bradenton-Sarasota metro area is “among the places most exposed to the national slowdown in vacation-home purchasing,” Michael Stromberg, spokesperson for SellMyTimeshareNow told Suncoast Searchlight.

Nearly 1 in every 7 homes sold in the North Port-Bradenton-Sarasota metro is used seasonally, recreationally or occasionally, the report found. Many are owned by snowbirds, who purchase homes to live here during the winter months, then return to their primary residences up north over the summer.

Because second homes are often discretionary purchases made by more affluent buyers, a slump in that market can serve as a partial gauge for broader economic conditions, said Chris Jones, an economist at the University of South Florida and president of Florida Economic Advisors.

The decline suggests even higher-income households are becoming more cautious about major purchases, Jones said, although he cautioned against seeing it as evidence of a major economic downturn. For that, he said, economists typically look for a slump in the primary home market, along with declines in economic output and job growth, before raising alarms.

Still, Jones told Suncoast Searchlight the slowdown reflects growing concerns over inflation and high housing costs. And, though the report examined purchases only through 2025, he said more recent events, like the impacts of a global oil shock tied to the conflict in Iran, have added another layer of economic uncertainty for buyers.

These conditions could be a possible sign that the United States is heading toward a rare period of stagflation, which occurs when there is slow economic growth, high unemployment and rising prices. 

The last time the United States experienced this economic anomaly was in the 1970s following the OPEC oil embargo and Iranian Revolution. 

The local impact of a decrease in second-home sales can have broader implications, Stromberg said.

“Fewer second-home purchases can translate into less activity for businesses and service providers that benefit from seasonal residents, while also reducing a source of demand that has historically supported parts of the local housing market,” Stromberg said.

“At the same time, the decline likely reflects broader affordability challenges facing vacation-home buyers nationwide rather than a loss of interest in the Sarasota area itself,” he said. “The region remains one of the country’s most prominent vacation-home markets.”

Current economic shift

The decline in purchases aligns with “a rapid deterioration in affordability,” according to the SellMyTimeshareNow report.

“Mortgage rates rose significantly from pandemic-era lows, increasing borrowing costs and reducing purchasing power, even for higher-income households that typically drive second-home demand,” the report states.

Previous reporting by Suncoast Searchlight found home prices rose by about 60% since 2019 to more than $400,000 in 2022 and have hovered around there since. The median sale price for a home in the Sarasota area was $490,000 in March, about 16% higher than the rest of the state.

But primary home sales are beginning to level off — and houses are now sitting on the market for longer.

Sean Snaith, director of the University of Central Florida’s Institute for Economic Forecasting, said the United States is in the midst of a slowing economy that is creating plenty of uncertainty in the real estate market. 

While unemployment rates are low by historic standards, hiring rates are very slow. There is uncertainty with artificial intelligence and the impact it will have on the labor market, Snaith added. Plus, with the shock of oil prices leading to higher costs of living, buyers are waiting to see how things shake out.

But Snaith noted that the current situation doesn’t mirror that of the 2008-2009 financial crisis that led to the Great Recession. At that time, low lending standards enabled anyone to get a mortgage for a home. After a year or two, borrowers were unable to keep up with mounting mortgage payments, leading to a rush of foreclosures from borrowers underwater on their payments and ushering in the financial crisis.

“(The) bottom line is there are a lot of variables that are in motion right now that are impacting the ability of people to make this decision about buying a vacation home,” Snaith said. 

COVID-19 pandemic “feeding frenzy” comes to an end

In the almost 30 years Laura Benson has been a Realtor, what happened during the pandemic was something she’d never experienced.

Now a sales leader for Compass Real Estate in Sarasota, Benson recalled how agents could list a property for sale, and by the next day, 20 offers would pour in. Properties were being snatched up at levels never seen before, she said, calling it “a feeding frenzy.” 

“The economics of that period of time were an anomaly,” Benson said. “I have never seen anything like it. People were buying anything they could get their hands on. That was weird.”

Benson added that there has been a big drop since 2021, with real estate market conditions returning to a more normal or cyclical level. 

Mortgage rates are now double what they were during the pandemic, Benson said, and insurance costs also have soared. 

In Florida, homeowner’s insurance premiums shot up 75% between 2021 and 2025, according to a report from the national nonprofit group Coalition for an Insurable Future. 

“Over the last three years, it’s been more consistent, the number of properties that are put on the market versus those sold,” Benson said.

What’s happening locally in Sarasota and Manatee counties?

The slowdown Benson described has been most evident in the second-home market.

The overall market had a slight rebound this year compared to the six-month loss period at the beginning of 2025, which was affected by high interest rates, the back-to-back hurricanes that hit Sarasota and Manatee counties and high insurance rates, said Alex Krumm, broker owner with NextHome Excellence and Broker Advisory Committee Chair with the Realtor Association of Sarasota and Manatee. 

When interest rates went down towards the end of 2025, there was a huge sales boost in Sarasota and Manatee counties, Krumm said. 

Now, though, he said, it’s like someone turned the lights back on and people are putting a pause on buying homes.

Benson wasn’t quite sure the report provided “an accurate conclusion,” noting that the area experiences waves of property purchases with the number of listings steadily increasing recently and the number of purchases staying relatively consistent over the last three years. 

In May, Benson said around 2,400 properties went under contract in Sarasota and Manatee counties, compared with about 2,000 during the same time last year.  

She added that condominium sales have seen a big drop-off due to legislation that went into effect after the 2021 collapse of Champlain Towers South in Surfside. Insurance rates also significantly increased, with condos now required to fully fund the reserves for their capital maintenance needs.

“Condos are taking longer to sell,” Benson said, “and usually there has to be a price premium for someone to consider buying it.” 

Krumm argues that the market is far from dead. Now, local residents are the ones driving the market forward instead of out-of-state retirees.  

“It’s actually one of the best times to buy right now,” Krumm said, “even though the interest rates are high, the prices are down, and I would rather have a high interest rate on a low price than a high price on a low interest rate.” 

Gabriela Szymanowska is a contributor for Suncoast Searchlight. Email her at gszymano20@gmail.com.