Posted on Wednesday, November 02, 2011
Some of our clients here locally are looking to acquire and rent Naples real estate properties and this summer we observed Naples annual vs. seasonal rental properties were tough to find. The national press hints at a warming rental market as well … for example Capital Economics economists observed the median monthly mortgage payment is about equal to the median rental payment and Axiometrics reports rents are rising at a 5.17 percent annual rate, approaching a record high set in 2000 (Florida REALTOR, NABOR).
So what’s up? Is the Naples real estate rental market heating up? Maybe – we hear potential buyers are purchase shy, snow birds and local residents alike are interested in moving into new real estate properties but with the rough markets of the last few years feel they should rent. Will the renters miss some capital appreciation if prices rise? Maybe, they might also avoid a down turn and frankly they want to take the risk out of home buying for now – even if they miss a little upside.
In addition there are the traditional renters – the one to multi-month snowbirds who might rent the same place time after time and the first-time-in-towners who now want to rent for a while (typically one to three seasons) to get a feel for real estate in Naples. Gone, for now, is the fear they might lose a great property to another buyer so they rent and wait and watch.
Rent, rent, rent – and up go the rental rates. No wonder our investors are looking to buy, hold and rent as their new strategy. But what do the numbers say? Well, it looks like a normal rental year quite frankly, nothing extraordinary. We do not see a break away rental market – yet. In the last twelve months in Naples 1,721 properties were rented and as of this morning as we head into season we have 1,727 properties for rent – so annual demand and current supply are dead even. Now some of this data is tough to figure out because of our winter season peaks but today in Naples we don’t see a big real estate rental supply shortage. So rents may be rising nationally but locally it feels like supply and demand are about right.
Let’s see what the rental rates look like in the next NABOR report. Today the Naples real estate rental market feels like it might be improving but we need to see next month’s numbers – more on this later.
What are your thoughts on the Naples rental market for seasonal or annual real estate properties?
Mark Goebel, PA is a REALTOR with Coldwell Banker on 5th avenue in Naples, Florida with 35+ years of visiting and living in Naples. After 25 years at Accenture, Mark retired as a managing director and spends his time helping non profits and building a Naples real estate team with his wife Nan. Talk to Mark and Nan about life in Naples and why they chose this place to live full-time over all others.
Mark Goebel, PA