Are you a real estate investor or landlord in Southwest Florida? Curious about where the rental market is headed in Fort Myers, Cape Coral, Naples, Port Charlotte, or Lehigh Acres?
You're not alone.
At Red Fortress Property Management, we've been managing properties across this region for over 35 years. This report offers a clear, data-backed look into Q1 2025—so you can make informed decisions in a market that’s constantly evolving.
National Rental Trends – A Slowdown in Growth
Before we dive into local numbers, let’s set the stage with what’s happening nationwide.
Occupancy Is Down
According to Zelman & Associates, single-family rental occupancy has dropped to 95.5%, the lowest it's been in over a decade. This challenges the popular narrative that housing inventory is tight—at least on the rental side.
Rent Growth Has Stalled
Nationally, new move-in rent growth is hovering around 1%—a historic low over the past 13 years. Blended rent growth (new move-ins plus renewals) is also minimal, sitting at just 2%, levels not seen since the COVID-19 shutdown in early 2020.
Housing Construction Shifts
HUD data reveals a national decline in multi-family housing starts, while single-family home starts are trending upward. This is key—investors may see fewer new apartments entering the market, while competition among single-family rentals may grow.
Local Insights – What’s Happening in Southwest Florida?
Let’s zoom in on our region. Here’s a breakdown by city, showing rental availability for 3-bedroom homes across different price points.
| Region | Trend | Notable Data |
|---|---|---|
| Fort Myers | Slight uptick in availability under $2,000 and $1,700/mo | Moderate growth |
| Cape Coral | Steady inventory growth including under $2,000/mo | From 950 in Jan to 1,182 in Mar |
| Lehigh Acres | Inventory growth with some price pressure down | 536 to 673 homes available |
| Port Charlotte | Most stable market in the region | Very little new inventory |
| Naples | Holding steady, but no options under $2,000/mo | A lot of 3 bedrooms available |
Click here for our blog on why Red Fortress markets better than MLS!
Why Red Fortress Property Management Markets Better Than the MLS
Key Market Observations
A Rise in Furnished Annual Rentals
We're seeing more furnished units offered as annual rentals, a shift from traditional seasonal strategies. Owners who can’t sell are trying to lease their properties without removing furniture—an indicator of market pivoting.
Pre-Construction Rentals Are Clouding the Data
Builders are increasingly listing homes for rent before they’re completed, often using stock photos. This makes it difficult to assess real-time inventory and can confuse potential renters about availability.
Applications Are Holding Strong
Our property management office saw consistent application volumes in early 2025, echoing trends from 2023. Keep in mind, post-Hurricane Ian demand in 2023 drove higher rental interest. So, while application counts are good, they’re more balanced now.
Sales Market Slowdown Is Contributing to Rental Pressure and Inventory
Zillow’s Heat Index Shows Cooling Demand
In February 2025, Zillow reported the worst seller’s market in seven years for Naples, Cape Coral, Fort Myers, and Port Charlotte and surrounding areas. Fewer homes are selling at asking price, pushing owners to pivot their listings into rentals—further adding to supply.
Understanding Mortgage Rates and Market Forecasts
Let’s clear up a common misconception: mortgage rates don’t move in lockstep with the Fed’s interest rate.
What Really Affects Mortgage Rates?
The real driver is the 10-year U.S. Treasury note. Despite the Fed’s rate adjustments, the 30-year fixed mortgage rate has stayed flat around 6.5% for the past year.
This is the metric to watch if you’re planning to refinance or buy.
Final Thoughts – What’s Next for SWFL’s Rental Market?
Construction and Oversupply
In 2023, Lee County built more single-family homes than any other Florida county—over 10,700 new units. With around 30,000 new residents moving in annually, we're currently overbuilt.
Expect a construction cooldown in the next year or two, which should help rebalance supply and demand.
Inflation, Oil, and Government Spending
U.S. oil production is climbing, which should ease energy costs.
The federal government is aiming to reduce deficit spending, which may influence interest rates long-term (downward pressure).
Employment is rising (March 2025 added 228,000 new jobs), but inflation and tariffs could complicate things for construction costs.
What This Means for Landlords and Investors
Pricing matters more than ever. With growing inventory, particularly over the $2,000 range, landlords must stay competitive.
Monitor rental trends monthly. Our team tracks actual market data—not just seasonal or national opinions.
Diversify offerings. Furnished annual rentals could appeal to a shifting tenant base who want furnishings.
Know your exit plan. If you can't sell, be ready to lease—and vice versa.
Ready to Talk Strategy?
Whether you own one property or manage a portfolio, understanding the real-time rental landscape can make or break your ROI. If you’d like help evaluating your investments or setting rental pricing, let’s chat.
📧 Reach me at mike@redfortresspm.com
