December 2025 — Market Outlook

Closing Out the Year With Momentum and Milestones

As 2025 draws to a close, we find ourselves reflecting on an extraordinary year — in the markets, in the economy, and along our own Emerald Coast. This edition marks a special milestone: the completion of 19 consecutive years of publishing our Monthly Newsletter. To commemorate the occasion, we’ve expanded this final issue of the year to three pages LOL

Last week’s FOMC announcement brought a welcome, albeit widely expected 0.25% reduction in the Fed Funds Rate. It’s a modest cut — but it is a meaningful signal. And, not a bad way to end the year.

Below, you’ll find a chart that tracks three essential benchmarks from 2015 to today: the Federal Funds Rate, the Prime Rate, and 30-year mortgage rates. Together, they tell the story of a decade that started with near-zero rates, shifted abruptly during the inflation surge beginning in 2022, and now appears to be slowly settling back toward balance.

The quick take:

· The Fed held rates near 0% for years, then executed the fastest tightening cycle in decades.

· The Prime Rate moved in tandem, as it typically runs roughly 3% above Fed Funds.

· Mortgage rates remained low until inflation ignited, then rose sharply alongside the 10-year Treasury.

 

The Local Market: A Year of Stops, Starts, and Signs of Strength

Here along the Emerald Coast, buyer activity has been sporadic — coming in pulses rather than the steady rhythm we typically see in the fourth quarter. This quarter has historically been one of the strongest of the entire year. While this year hasn’t followed its usual pattern, the overall momentum remains absolutely positive. We are seeing more buyer engagement and more enthusiasm.

Inventory levels dipped this month, as did total sales and average sale prices. This tightening is common in a transitional market and signals that we’re preparing for a stronger start to 2026. In short: we’re heading toward greener pastures.

Single-Family Homes: About 8.3 months of inventory (249 days). Recent sales averaged 127 days on market and closed at 96% of asking price, reflecting steady buyer confidence.

Condos: Roughly 12.5 months of inventory (376 days). Sold units averaged 285 days on market, achieving 95% of list price. Year-to-date, active condos average 226 days on market.

With an estimated 68% of homes owned free and clear or with more than 50% equity, the Emerald Coast market remains fundamentally strong and well positioned for sustained growth.

A summary of November Average Sold Prices:

                                                    Single Family                  Condo
 30-A                                          $2,364,455   (69)         $1,247,179   (15)                                   
Destin/Miramar Beach           $1,147,057   (45)         $   647,754   (70)
Ft. Walton Beach                     $  471,794    (62)         $   342,000   (11) 

Interestingly, the median home sales price — Fort Walton Beach to Inlet Beach — in November was $1,311,515, versus the median sales price of $875,000. Simply put, this spread indicates that significantly more upper-end properties sold than lower-end in November.

Bottom line: 2025 was underwhelming, but the handwriting is on the wall — 2026 has all the earmarks of a much improved year!

Wishing everyone a Very Merry Christmas and a Joyous Holiday Season!

 

Ed & Terri Smith 

RE/MAX Coastal Properties

Selling Emerald Coast Real Estate Since 1987!

Inlet Beach - 30A - Santa Rosa Beach - Miramar Beach - Destin - Fort Walton Beach