Luxury Market Leading the Way!
By Robert L. Nardi
Unlike national figures for home sales in January which, according to the National Association of Realtors®, dropped 4.8 percent compared to sales in January 2017, home sales in Collier County rose 11 percent in January to 671 home sales in January 2018 from 603 home sales in January 2017. In fact, closed sales of luxury properties (homes above $1 million) were quite remarkable in January with a 123 percent increase over the number of closed sales of luxury properties in January 2017, according to the January 2018 Market Report released by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island).
The luxury properties seem to be driving the market. Pending sales of homes priced above $1 million increased 67 percent in January compared to last year. It appears there was greater demand between the $1-$2 million and the inventory was 19% lower. As a result, the median price increased by 17%. However, it appears that prices did drop almost 19% for the $2 million & up properties. Yet, pending sales were up almost 88%.
Overall median prices in January decreased for homes up to $1 million compared to last year. For example, median closed prices for properties in the $300,000 and below price category decreased 6 percent in January to $205,000 from $219,000 in January 2017.
Overall inventory in Collier County decreased 5 percent in January to 6,071 homes from 6,393 homes in January 2017. However, inventory has been on the rise over the past few months and while the nation continues to experience declining inventory levels that resulted in a 3.4 months’ supply for January, the Naples area market is seeing its inventory levels increase to 8.2 months of inventory for January.
There are areas in which prices increased. The South Naples (34112, 34113) and East Naples (34114, 34117, 34120, 34137) single-family home markets continued to see the strongest increases in value in January, as reflected in 8 and 9 percent increases in median closed prices, respectively. This is probably due to the vast amount of new construction that is taking place in those specific zip codes.
The NABOR® January 2018 Market Report provides comparisons of single-family home and condominium sales (via the Southwest Florida MLS), price ranges, and geographic segmentation and includes an overall market summary. The NABOR® January 2018 sales statistics are presented in chart format ( CLICK HERE) which would assist you with getting more detailed information.
What does this all mean?
It looks like the luxury market is leading the way. Numerous spec homes (homes that builders built, speculating that someone would buy them) and new luxury condominiums appear to be our “best sellers.” Why? Based on what we learned in the report, there was a surge of buying for properties between $1-$2 million, lower inventory & more demand. Also, prices decreased a whopping 19% over the $2 million mark. Therefore, Buyers took advantage of these price drops and found the value they were looking for.
In the meantime, Inventory is higher, and demand is somewhat lower in other segments. When this occurs, prices start to drop. I believe the reason why demand is lower is because of the new tax laws affecting mortgage interest tax deductions. People feel insecure until they fully understand the tax law.
Searching for the Perfect Property?
Are you searching for the perfect property to purchase or rent? Please feel free to perform your own property search at www.NardiRealty.com. The search tool is easy to use. You can also check out all our own properties for sale & for rent with one click of a button. And as always, I am here to assist. Please feel free to call me directly at 239-293-3592 or e-mail me at Robert@NardiRealty.com.
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