At the halfway point of 2025, it's the perfect time to assess Panama City real estate for both buyers and sellers, identify current trends, and gain a better understanding of where the market is heading for the second half of the year. After a few years of meteoric growth, the pace has shifted—measured, more selective, and increasingly favorable to buyers who know where to look. Make no mistake, this isn't a market downturn, far from it. However, there has been a considerable shift towards a more balanced luxury home marketplace, where numerous opportunities exist for both those seeking Emerald Coast properties and those looking to sell.
Current Market Trends
Panama City and neighboring Panama City Beach have long held a unique position in Florida's housing landscape—part beach escape, part small-town charm at the eastern end of the state's celebrated Emerald Coast—the area is increasingly a haven for investors looking to balance affordability with lifestyle-driven demand. In the past, such desirability drove the market to new heights, primarily benefiting home sellers.
This year, however, that narrative is evolving in meaningful ways. Home prices in the area have eased slightly, reflecting broader shifts across many Florida markets. At the end of May 2025, in Panama City proper, the median home price dipped to around $331,300, a nearly 4% decline year-over-year. In Panama City Beach, prices have pulled back more noticeably, with the median listing price now at $444,000, a decrease of over 6.8% from the same time last year.
The corrections are by no means dramatic—home prices have been trending this way for the past two years, largely in response to economic uncertainty and mortgage rates tracking in the opposite direction. The good news is the newfound market balance provides buyers more breathing room—especially when coupled with the growing number of active listings coming to market, which creates space for more balanced negotiations.
Inventory is Up, and Buyers Are Taking Their Time
Increased supply has helped cool what was once an overheated market. For June 2025, in Panama City Beach alone, more than 1,900 homes are now on the market, a 115% increase from the previous year. Panama City has roughly the same number of available listings, a 67% increase from the same time frame last year. The average days on the market are up considerably in Panama City, where homes are sitting on the market 33% longer than they did in June last year. Time on the market for beach listings is trending down, averaging 87 days on the market—a 15-month low.
This doesn't mean homes aren't moving; they are. But the days of full-price, same-week offers are on pause for now. For serious buyers, this creates a more thoughtful environment—one where due diligence, contingencies, and competitive pricing strategies are far more commonplace than in prior years.
Mortgage Rates
Even in a state that claims a large percentage of all-cash home sales, interest rates continue to play a key role in overall market activity. With 30-year fixed mortgage rates hovering near 7%—and no clear sign of sharp relief ahead—many buyers are recalculating their monthly payments and waiting for more favorable terms. Even well-qualified buyers are weighing the benefits of creative financing, adjustable-rate options, or seller buy-down incentives to make the math work.
Yet, the high rate trend—the last time the primary mortgage rate for a 30-year fixed-rate mortgage was below 6.5% was in October 2024; the last time it fell below 6% was in September 2022—hasn't completely sidelined the market. What it has done is shift the market more in favor of buyers, who now carry stronger negotiating power.
What This Means for Sellers
If you're considering listing your home in Panama City or the beach communities, the playbook has changed. Today's successful sellers are embracing a comprehensive listing strategy, which includes single-property websites, professional staging and photography, video marketing, digital advertising, and cultivating a diverse range of potential buyers, including those internationally.
Homes that are turnkey, thoughtfully updated, and well-located—particularly those with water views, deeded beach access, or walkability to amenities—are still attracting strong interest. But while price remains critical to buyers, what they're buying carries far more weight than what we saw between 2020 and 2023.
For Buyers: Timing, Inventory, and Value Are Finally Aligning
Buyers who felt priced out in recent years may find 2025 more forgiving. The combination of rising inventory and slightly softened prices is creating opportunities across multiple price points—from under $400,000 for inland properties to $1 million+ for waterfront estates. With more time to tour, compare, and negotiate, the luxury buyer now has room to be selective—and strategic.
Vacation home seekers and investors also have renewed options. Whether it's a short-term rental opportunity near the beach or a longer-term income property closer to town, the fundamentals remain strong—but the deal structure needs to reflect today's carrying costs and future growth potential.
Looking Ahead
The next nine months, heading into the Spring 2026 buying season, are likely to bring more of the same: steady activity, moderated price movement, and a continued shift away from the frenzy of years past.
The luxury tier—particularly well-maintained Gulf- or inland-water view homes and new construction near the water—should remain resilient. But inventory will continue to shape the story. If rates fall slightly toward the end of the year, expect renewed buyer competition and a more balanced market between supply and demand.
The key for everyone, whether buying or selling, is realistic expectations and guidance rooted in current, hyper-local knowledge.
Explore More of Panama City's Luxury Lifestyle with a Trusted Local Expert
2025 is shaping up to be a year of rebalancing in Panama City's real estate market. The days of unchecked growth may be behind us, but what's emerging is a more sustainable, opportunity-rich market—especially for buyers, sellers, and investors who know how to navigate it.
If you're ready to start your search for a Panama City luxury home—or if you're interested in listing yours for sale—contact The Real Experts today to start your Emerald Coast real estate journey.
