Posted on Wednesday, March 28, 2018
If there is one thing to take away from this month’s look at Naples real estate it is this, supplies tightened, year over year prices rose modestly and sellers received offers close to asking price as more buyers arrived in Naples. Unusual spring snow storms “up north”, a strong economy, new tax breaks and baby boomer demographics all seem to contribute to very positive real estate demand here in Naples.
Here are a few highlights:
This is a great time to buy or sell a home in Naples as many properties exchange hands as seasons draws to an end.
The highlights above may be all you need to know, but please keep reading. The overall market is one of the best in a while but as our readers know results vary by neighborhood, property type and many other factors. We need to get into the numbers to show you how things are going. Here we go!
One year ago the median Naples property (single family and condos) sold for $348,000. This month we are at $370,000 for a 6%+ year over year increase. Buyers continue to find Naples homes and prices attractive.
At the heart of property prices in any real estate market is supply and demand. The Naples market inventory is at 8.39 months and the tightest we have seen in March in two years. If historic supply and demand forces hold true we should see further price increases. Any supply level under 12 months tends to be positive to prices.
There may be important shifts in the months ahead however so keep reading our newsletter! At the time of this writing the Federal Reserve raised rates, a trade war may be looming and the US stock market swooned. So what? Well the “so what” is mortgage rates are rising and will probably continue to rise in the face of market uncertainty. Demand may slow in the face of uncertainty but so far our great weather and lifestyle bring in the buyers.
Balancing rising rates are those international buyers. The weakening dollar means real estate here looks cheaper and cheaper if your are buying with foreign currency. About 21% of our market buys in foreign currency. Get ready to welcome the Western Europeans and Canadians back to this market.
Let’s look at price reductions for more interesting news. Where sellers used to take 16-20% price reductions to sell their home, sellers need only 2%+ reductions (on average) to sell. Sellers gained a lot of ground when negotiating with buyers this month. Interesting!
Another interesting area to look at – The Luxury Market. We now have a real rally taking place after months of slow sales. Naples luxury properties (defined as properties listed above $2,000,000) sold for a lot more money this month and inventories improved to 13+ months. Luxury is back – let us see if the trend continues.
Readers will remember condo prices fell a full year before single family home prices in the Great Recession so condos may be a “canary in the mine” indicator to foretell future trends. So what happened this month? Inventories tightened to 8+ months and prices increased 6%. Nice. The canary is fat and happy – no worries here!
We all know real estate is local, so what is happening in different neighborhoods? Let’s take a look. Oh good, more data!
Olde Naples – Who doesn’t like Olde Naples? Walk to the beach, retail shops and restaurants needing no car or even a scooter. The real estate pace improved this month. Inventories are at 11+ months and much better than last month – we should see support for prices in the months ahead.
Pelican Bay – back to its old ways Pelican Bay is again a hot market. Inventories tightened to 9+ months inventory so expect support for price increases.
We helped one of our customers write an offer here last month AND placed a $1,000,000+ property under contract. Our marketing methods are working well for our sellers and buyers here. What a wonderful place to live and enjoy those beach amenities!
Windstar On Naples Bay – “A one of kind community with a yacht club, a golf course and a private shuttle to Keewaydin Island – all on Naples Bay”
So how is inventory in Windstar? 9+ months – so expect prices to rise here in the short term. Open houses are very popular and when you buy at Windstar on Naples Bay you get Tom Fazzio’s first Florida golf course and a yacht club all on Naples Bay! And … residents and non-residents alike may purchase well priced boat slips right on Naples Bay!
Another seller in Windstar selected our real estate team over two other top teams in a hotly contested battle! After a thorough analysis we are so pleased to report these wonderful home owners selected our team to sell their home. Can we be of help to you and your friends?
Crayton Road – “The charm of this near north side neighborhood away from the maddening crowd is truly wonderful”
The current 9+ month inventory improved over last months 12 month level so we expect price increases here in the short term.
Royal Harbor – “On water living and walkable to town and new development on the way”
Royal Harbor inventory is at 5+ months and red hot – the hottest market in our report this month. You rarely see inventories this low in recent months. We expect very strong support for price increases in this area in the months ahead. There is a lot to like in Royal Harbor.
Port Royal and Aqualane Shores – “one of the finest enclaves anywhere”
Unfortunately inventories are too high here. At 22+ months we are at twice the level we like to see for price stability. The build up started last March and seems to continue. We need to see price drops or more buyers or both to get this market moving again. Are homes selling here? Of course, but it is clearly a buyer’s market. Join us and make an offer for a spectacular home!
Marco Island – “Island life and the beach at Tiger Tail offer a remarkable experience”
Inventories tightened to 11+ months (same level as last month) so expect stable prices here in the short term. Houses and condos may be less pricey here compared to Naples and include incredible boating, golf, tennis and beach lifestyles. Check it out with us – there is a lot to love about Marco Island. Our colleagues at Marco Island Coldwell Banker provide excellent service.
Following our own advice we may have an exciting new project to announce next month so stay tuned! Think on water luxury in Paradise.
What we continue to find interesting on the Island is the struggling luxury single family home market – defined as properties above $2,000,000. Many of these properties offer incredible bay views and yet inventories are 30 months+ up from 20 months+ last month. Our readers will know this figure is too high to support prices in the short run. Similarly to Port Royal, we need price drops or more buyers are both to get the Marco Luxury market moving.
The Marco Island single family market priced $500,000 to $2,000,000 is in much better shape! Inventories in this price range are 13+months showing homes are fairly priced – in fact if you find new on water homes with favorable sun exposures the market is very strong!
And the story on new construction? The big market dynamic of new construction continues and perhaps we are now overbuilt slightly. It is tough to capture real data from the developers but the scuttlebutt is “we are a little far out over our skis”, meaning overbuilt. There are an estimated 18 new communities in Collier County at a variety of price points with some fantastic floor plans. Developers offer some nice incentives to encourage sales. If you are considering new construction right now, this is a good time to be looking.
So our market is experiencing another peak tourist season filled with buyers excited about Naples and Marco Island. The months ahead will tell the tale but sunny weather and millions of boomers moving to Florida may continue to drive the markets up. All signs are for a very strong end to the 2018 tourist season. We will see.
Please give us a call if you are considering buying or selling in Naples. We would love to talk with you!
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