By Robert Nardi
According to the November 2022 Market Report by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island), there were 552 overall closed sales in November, which is a 41.4 percent decrease from 942 closed sales recorded in November 2021. The post-pandemic home buying surge when mortgage rates were historically low has ended. Housing inventory in Naples is rising but remains low at just 2.8 months of inventory reported in November (a balanced market has a six-month supply of inventory). As expected, the limited inventory environment in Naples is restricting sales and increasing prices. Though broker analysts reviewing the report pointed out that cash sales accounted for 62.3 percent of closed sales in November, it indicates that the Naples housing market remains a solid investment. The November report showed inventory rose in all price categories except the $300,000 and below category, which decreased 14.2 percent from 127 to 109 properties. Overall inventory in November rose 96.8 percent to 2,478 properties from 1,259 properties in November 2021. Comparatively, in November 2019, there were 5,563 properties in inventory, which was split between 2,771 single-family homes and 2,792 condominiums. Today, the inventory is single-family home heavy, accounting for 63 percent of all homes in Naples. November's overall median closed price increased 20.4 percent to $600,000 from $498,500 in November 2021. Here is the report in chart form (CLICK HERE) for those of you who wish to see all the statistics.
What does this all mean?
We are slowly turning into a balanced market. The only hurdle now that we have is insurance. Since Hurricane Ian, insurance companies have been inundated with insurance claims. To add to the mix, they are swamped with the harsh weather up north (pipes bursting from the cold, roofs leaking, etc.). They are moving slower than usual, so many potential sellers are also slow to move. They need to work with their insurance company to get a resolution to repair damaged properties to put them on the market. Hence, it will be slow before six months of inventory are available.
Now for the buyers who are purchasing and wish to obtain insurance, it is becoming more and more difficult. If you purchase a property with a 20-year-old clay tile roof that is sound and has no leaks, no insurance company will insure the property. However, you can seek a third-party insurer, like Lloyds of London. The price of insurance could be costly until a new roof is installed. If it is a shingle roof and is 15 years old, insurance companies will still insure it but will need to undergo a certification process each year up until its 20th year, and then it must be replaced. Lastly, some insurers now offer insurance but will no longer insure the roof. Hence, when looking at a property, you must read the Seller's Disclosure, find out the roof's age, and investigate your insurance options. You can also try shopping for insurance using an Insurance Broker instead of just going through one company. They can send out your information and receive 3-4 quotes back.
The benefits of living in Florida full time.
Property owners pay three times more for property insurance than in other states. However, there are many financial benefits to living here. First of all there is no state tax, and if you purchase in Collier County, real estate taxes are 1.25% of the assessed value set by the Collier Appraiser. I am happy to report that Collier County has the lowest real estate taxes in all of Florida. In addition, if you don't live in the City of Naples proper, you have no city tax. The other huge benefit is the homestead exception. If you become a full-time resident, you'll receive this exception on your real estate taxes, saving you up to $625 a year on your taxable value. The most significant savings is that your taxes can only increase by 3% a year until you sell your property. Even though your property value could go up 10% a year, you pay taxes of 3%. This is a considerable saving over time. Another benefit is if you are a married couple and one spouse dies, it simply transfers to the other spouse without any tax ramifications. Lastly, since it is your homestead property, if you were ever involved in a lawsuit and a lien was placed on your home, a judge could never force you to sell your property to pay off the lien.
We live in paradise!
Southwest Florida is recovering quickly from Hurricane Ian. 95% of our beaches are open. The Gulf of Mexico is shimmering greens and blues. Our weather is fantastic in the winter months. So if you are looking to buy a little piece of paradise, you could always start searching online at www.BuyNaples.net , or if you wish to have personalized service, please feel free to contact me directly at 239-293-3592 or send an e-mail to Robert@NardiRealty.com . I am here to help! Happy New Year!