The 2025 real estate market has picked up exactly where Q4 of 2024 left off! It has been a quality start to the year, with a lot of highlights. The Mexico Beach/St Joseph Beach area saw its highest sale ever in February, with 9113 Hwy 98 selling at $3.15M. This is the first beachfront sale of over $3M in the area. The MB/SJB area has also seen more sales volume through Q1, compared to this time last year, with over $20M selling so far. The number of sales for properties within the $500k-$1M range is up 35%, while the number of days these properties are on the market, has decreased. Properties under $500k are right on par with last year, sales-wise, while the days on the market are down 11 days from 2024. The $1M+ homes aren’t moving as much as they did in 2024, but there are still a handful of properties moving.
The biggest attraction so far this year has been canal-front properties, with five sales already this year and another one under contract, set to close in April. We have also seen building across the Forgotten Coast start to pick up from the beginning of the year. In March, builders started construction on 11.2% more homes than in January. Part of this does play into rates coming down from the start of the year. Rates have come down about a third of a point from 1/1 to now. They are currently sitting at around 6.65% for a 30-year fixed rate, which is down over a half point from the middle of last year. Plus, rising for the third straight month, Industrial Production hit an all-time high, Retail Sales rebounded in February, and the Leading Economic Index (LEI) stayed on its upward trend, indicating no imminent recession.
Rentals
Rentals are holding steady as well. However, the market has definitely become more rate-sensitive due to the constant increase in vacation rentals. Most rental companies are starting to place a lot of emphasis on specials and discounts to attract more renters with the growing competition. The average book-to-stay date has gone down, showing that more bookings are coming at the last minute rather than months in advance. The current average sits around 78 days, whereas it was at 97 last year. According to two local rental companies, march bookings are up significantly from last year and 2023. Overall, it is very possible to surpass 2023 and 2024 rental numbers, but you have to keep a good eye on your rates compared to the rest of the market. Long-term rentals are up 3.6% on average rent for single-family residences and 2.5% on multi-family. There has been no drastic increase in the number of long-term rentals in the area since the end of 2024.
What’s New | Update on the Area
A lot is going on in the Mexico Beach area. The biggest project by far is the $26M beach renourishment that is taking place. This was 100% covered by state and federal grants. We were told they would be done by May and so far, that looks to be true. They are working 24 hours a day to get it done! We will also be seeing a couple of new businesses and buildings come to the area. The official name of the new grocery store will be Seaside Marketplace. This will be located next to Mango Marleys and will feature a Lucky Goat coffee shop upstairs. Below is a rendering of what the building will look like. They are hoping to go in front of the city council for approval within the next month. Toucans is also continuing with construction, hoping to be open by the end of 2026. Also opening soon will be the Mexico Beach Bar. This will be located right next to the Express Lane. It will also feature the MB Liquor Store, which was previously on 15th St. The old Beach Pizza building is also getting closer to completion and already has a tenant coming in to open a new restaurant. Lastly, a mixed-use building, just to the west of that building, was just permitted and will feature both retail/office space and a 3BR residential ensuite upstairs.
