| Welcome to the July Naples Best Addresses newsletter. For the supposedly quiet summer months real estate activity is good. Yesterday we helped one of our buyers go under contract on an investment property and we have strong interest from a number of other buyers. Here is what we are seeing:
Just The Facts: Prices Continue to Climb as Supply Decreases In the twelve months ending June 30 the median home price rose 3.96% and supply (inventory) decreased 18.6.%. These figures follow the continuing price increase /supply decrease trend reported previously. Results differ by price segment and location but the overall trend is positive right now. We are particularly encouraged by the inventory decrease which in most measures is at or below twelve months, the theoretical price equilibrium point. Well priced properties are moving quickly and buyers and sellers are on a more even footing.
What are we hearing on the street? As we work with our clients we are finding current buyer thinking is a product of other real estate markets where perhaps the recovery is not yet underway. Let’s take a look at what we are hearing and how these thoughts relate to the on-the-ground facts here in town.
“You can buy something in Naples at 1/2 price!” A common claim. Such a purchase may be possible when comparing to 2005 price levels, however most properties today in Naples are closing with 75-85% of the original asking price. Original meaning before any price reductions. With improving prices in our local market and the decrease in available properties something closer to the asking is becoming a good indicator of closing price.
“I want new construction near the water.” Another frequent request.. This is a tough one as most of the near water properties were built out by the late 1990’s. There are a few vacant lots and some new spec homes – but not many. You can tear a place down (a trend some REALTORS are predicting to increase) but many target properties are already priced high anticipating the eventual value of a new home on the lot. You can also renovate and lift the roof to make nine foot ceilings and newer amenities. But … there are few “new” properties near the water.
“It is a buyers market.” It depends. As we reported on thenaplesbestaddresses.com web site and in our last newsletter inventories are decreasing. We are at the theoretical twelve month equilibrium overall and in some localized areas. In a theoretical “equilibrium” buyers and sellers are on even ground. There are opportunities but this is not the buyers market of 2008-2010.
4) “I want a great deal.” You can certainly demand properties in good condition, and target prices per square foot, but Naples is watched closely by lots of buyers. A true “steal” is very hard to find these days – and you need to be ready to jump on it the day it appears on the market, and expect a multiple offer situation. With the increase in the use of the internet to watch properties the seasonality of our market is decreasing. There are buyers out there every day of the year.
Please give us a call and let us know what is on your mind. Yesterday we previewed properties, same today and Friday morning we spend the day with one of our buyers. We think we have a good “on-the-ground” view of the market so call us or follow along virtually as we work in the Naples real estate market.
Have good month,