The Island Estate Report — August 2025 | Key West Real Estate Market Update

With July now in the rearview mirror, Key West continues to show clear signs of a buyer's market, with the absorption rate climbing to 10.3 months, up 8% from July 2024. This indicates homes are taking longer to sell, a thesis further supported by the increase in the average days on market, that sits at 141 days—up over 53% from last year.

Prices show mixed trends: average list prices for active listings have slightly decreased by 2.8% year-over-year to around $1.75 million YTD, median sold price has risen 11%, reaching $1.1 million, while the average sold price lagged, increasing by 5.69%, now approximately $1.45 million, suggesting that high-end listings might be facing downward price pressure. Overall the long-term growth trend appears positive despite prices trending lower over the short to medium term.

Key Takeaways

• Buyer's Market Conditions: With over 10 months of inventory and properties sitting longer, buyers have leverage.

• Sellers Must Price Strategically: Overpriced homes are languishing. Proper pricing ensures faster sales and fewer negotiations.

• Longer Timelines: Both DOM and absorption rate increases show a market that requires patience from sellers and responsiveness from agents.

The sold-to-list ratio has significantly dropped, now at around 85%, meaning sellers are receiving lower offers relative to their asking prices. Overall, inventory remains high and homes are spending more time on the market, underscoring the importance of strategic pricing and top-shelf marketing to attract serious buyers in this competitive environment.

If you're looking for a more personalized market report, our team is here to provide a custom analysis of your home, neighborhood, or island. Whether you're curious about your property's current value or want a deeper understanding of market trends in your area, reach out for all things Florida Keys real estate.