John Hawley
May 26, 2025
Fueled by migration from high-cost metros like Miami and New York, Jacksonville’s appeal is growing—but cracks are showing in both residential and commercial segments.
As Jacksonville enters the heart of 2025, the city’s real estate landscape is showing both promise and pressure. From booming industrial developments to a cooling residential market, Jacksonville offers a revealing snapshot of how Sunbelt metros are evolving in a post-pandemic, high-interest-rate environment. The contrast between sectors is stark—highlighting an economy in transition and underscoring the importance of strategic planning by developers, investors, and homebuyers alike.
Commercial Real Estate: Sector Snapshots
Industrial: Growth with Growing Pains
Jacksonville’s industrial sector remains a standout regionally, though it’s starting to feel the weight of its own success. In Q1 2025, the vacancy rate rose to 7.0%, fueled by speculative development and heavy construction deliveries—5.4 million square feet are still in the pipeline, with only 15% preleased.
Despite softening tenant demand, net absorption reached a healthy 959,000 square feet, and average asking rents held firm at $7.85 per square foot. Northside saw the largest rent gains, rising over 10% year-over-year thanks to demand for newer, premium space.
Outlook: The market remains fundamentally strong, but tenants are gaining leverage as supply outpaces demand. Developers face pressure to lease new builds in a cautious economic climate.
Office: High Vacancy, Tentative Recovery
In stark contrast, Jacksonville’s office sector continues to wrestle with high vacancy—22.0% as of Q1 2025. Downtown corridors, particularly Northbank and Southbank, saw significant occupancy losses, including a net 133,000 square feet in the CBD. Class A vacancy climbed to 24.2%, reflecting ongoing hesitancy among large tenants.
Yet there are green shoots. Leasing volume nearly doubled year-over-year to 728,000 square feet, driven by major leases from the Jacksonville Sheriff’s Office (342,000 SF) and Haskell (139,000 SF)—signaling strong institutional interest.
Outlook: With only one new office project under construction, supply constraints could support recovery in late 2025 if leasing activity continues to rebound.
Multifamily: Absorption Surges, But Rents Soften
Jacksonville’s multifamily market was one of the region’s most dynamic in 2024, with a record 7,181 units absorbed. However, effective rents declined 2.0% year-over-year to $1,497, and stabilized occupancy dipped to 90.6%. This reflects a catch-up phase as the market works through an oversupply of recently delivered units.
Notably, the pipeline is shrinking—just 4,193 units are under construction, down 59% from a year ago. Class A rents continue to command a premium, averaging $1,726 per unit, nearly 12% higher than Class B.
Outlook: Fewer new deliveries and sustained demand are expected to stabilize occupancy and put upward pressure on rents in 2025.
Residential Real Estate: A Market in Correction
Jacksonville's residential market is cooling amid rising rates and affordability concerns. According to Redfin, the median home price dropped 1.8% year-over-year to $304,495, while homes are sitting on the market 63 days, up from 49 days last year. Sales volume is down 8.9%, and the area is seeing a significant 18.4% home purchase cancellation rate, one of the highest nationally.
The price-per-square-foot fell to $184, and buyers are typically securing homes for about 3% below asking. These trends point to a market correction driven by both supply growth and reduced urgency among buyers.
Quick move-in inventory is up more than 320% compared to pre-pandemic levels, highlighting builder urgency to offload existing stock.
Neighborhood Highlights: Where the Shifts Are Most Visible
Downtown Jacksonville (32202): Prices collapsed 69.1% YOY to just $88,000, though time on market shortened to 28 days, suggesting investor activity or discount-driven interest.
North Jacksonville: Modest 3% price drop to $320,000; median days on market improved slightly.
32224 (Beaches/Intracoastal): Prices rose 1.5% to $492,500, defying the cooling trend. However, sales volume dropped and homes took longer to sell.
32209 (Urban Core/Westside): Prices surged 12.2% to $140,300, but homes lingered longer on the market—suggesting price-sensitive buyer segments.
Migration Trends: Where New Residents Are Coming From
Jacksonville continues to attract newcomers from both within Florida and across the U.S., according to Redfin driven by relative affordability and a growing job base. The top 10 metros feeding net population gains into Jacksonville from February to April 2025 include:
Miami, FL
New York, NY
Washington, DC
Atlanta, GA
Los Angeles, CA
Boston, MA
Orlando, FL
Chicago, IL
Seattle, WA
New Orleans, LA
These migration flows underscore Jacksonville’s appeal to residents seeking lower costs, looser zoning, and coastal proximity—particularly compared to more expensive cities.
How Jacksonville Stacks Up Statewide and Nationally
Compared to Florida cities like Tampa, Miami, and Orlando, Jacksonville has maintained stronger affordability metrics but is now facing similar headwinds: rising insurance costs, natural disaster risk, and high interest rates. Unlike Miami or Tampa, where prices continue to climb, Jacksonville is showing early signs of plateau or correction—potentially making it more appealing for long-term buyers.
On a national level, Jacksonville remains competitive due to its low unemployment (3.5%), moderate home prices, and strong industrial base. However, elevated cancellation rates and flattening rent growth reveal the vulnerability of a market transitioning from pandemic-era booms to more normalized conditions.
Jacksonville’s 2025 real estate outlook is one of measured recalibration. The industrial sector continues to outperform but faces potential oversupply. Office space is in flux, but recent major leases could spark stabilization. Multifamily is absorbing past surpluses and primed for growth later this year.
On the residential side, Jacksonville offers opportunity for buyers willing to negotiate, while sellers face heightened competition and longer sale timelines. Migration trends remain strong, but affordability and confidence will dictate the pace of future growth. In a region defined by contrasts, Jacksonville is learning how to balance expansion with resilience—and offering a case study for other Sunbelt metros navigating similar terrain.
