Naples Area Real Estate News & Market Trends
by Robert Nardi

Robert L. Nardi, Broker/Owner of Nardi Realty provides his perspective on the real estate market, trends, and news for Naples, Florida and the surrounding area each month. To subscribe to Robert's Monthly e-Newsletter click this link.

You’ll find our blog to be a wealth of information, covering everything from local market statistics and home values to community happenings. That’s because, at Nardi Realty, we care about the community and want to help you find your place in it. Please reach out if you have any questions at all. We’d love to talk with you!

Jan. 8, 2023

Market Watch January 2023

Purchasing and Insurance!

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!

Posted in Market Updates
Dec. 19, 2022

Market Water December 2022

Hurricane Ian and a Balanced Market

By Robert Nardi

Speculation that home sales in October would drop dramatically in Collier County following Hurricane Ian was proven inaccurate as closed and pending sales for the month increased by 23.7 and 8.7 percent. Respectively, compared to closed and pending sales reported in September, according to the October 2022 Market Report by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island). And even though 525 listings were either terminated, expired, or withdrawn from the Southwest Florida MLS during October, overall inventory increased 72.7 percent to 2,325 properties from 1,346 properties in October 2021.

Admittedly, compared to 2021, a standout year for real estate in Collier County, closed sales in October decreased 24.5 percent to 662 closed sales from 877 closed sales in October 2021. Pending sales (homes under contract) dropped 43.3 percent to 673 pending sales from 1,186 pending sales in October 2021. According to NABOR®’s statistics, October’s overall median closed price held fast at $555,000, the same as was reported in September. But compared to October 2021, the median closed price increased 23.3 percent from $450,000. The statistics showed a 1.6 percent decrease in median closed prices for condominiums between September and October. There was a 26.1 percent increase in new listings in October compared to September, which broker analysts say is typical this time of year. Overall new listings in October decreased by 13.9 percent to 908 from 1,054 in October 2021. Still, new listings for single-family homes soared in October and were just ten properties shy of the 548 new listings reported in October 2021.

The NABOR® October 2022 Market Report compares single-family home and condominium sales (via the Southwest Florida MLS), price ranges, and geographic segmentation and includes an overall market summary. NABOR® sales statistics are presented in chart format ( CLICK HERE ) for those who like statistics.

What does this all mean?

Unfortunately, the tragedy of Hurricane Ian and those that received water damage spurred some other types of buyers to the area. Some investors want to swoop down and “catch” a good deal, while others see Southwest Florida as a new opportunity to purchase at a reduced price. Some lower elevated homes West of 41 took a hard hit with flooding. Therefore, owners can either rebuild, re-model or sell the property “As Is” (which means they are not making any repairs). Many have owned their properties for years, with built-in equity. They are either too old or tired or do not want to take on the remedial process.

Also, some sellers have decided that they want to move East of 41 and no longer wish to live near the Gulf of Mexico even though they experienced no damage. And lastly, Hurricane Ian pushed them to move up North to be with family and friends full-time. Therefore, Naples/Southwest Florida housing market is starting to weaken as a Sellers’ market because the overall percent of the current list price received is 96.4 percent and has been declining since April. In a nutshell, more available units are now on the market. There are 2478 available properties for sale in Naples based on NABOR® MLS data (12/10/2022). We are inching our way to a balanced market (around 6000 units), allowing Buyers to negotiate a bit more than in the past. 

Demand for Rentals

As you may have noticed, rentals have taken a life of their own. They have increased in number, and rental payments have increased significantly. The demand for annual and short-term rentals has been overwhelming not only because of trying to find housing for displaced individuals from Hurricane Ian but because of the spur of people who want to rent for three months during the season. You would think that people would not want to come down in season; however, it has been the opposite. Naples/Southwestern Florida is still in demand. People want to experience “paradise” and get away from the cold. Nardi Realty still has some rentals available. If you are considering renting, please call my Rental Administrator, Lilly Fulcher, at 239-571-6189. She can let you know our rental availability, assist with your search, or put you in contact with one of our REALTORS® that specializes in rentals.

In closing, I want to wish all of you Happy Holidays! May your New Year bring you loads of health, happiness, and prosperity. 

Posted in Market Updates
Nov. 13, 2022

Market Watch November 2022

Hurricane Ian Impacting SW Florida Real Estate

By Robert Nardi

The impact of Hurricane Ian, as witnessed on the last two days of September, is not reflected in the September 2022 Market Report by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island). Given this, September's data showed a predictable pattern of slow closed and pending sales with a slight increase in inventory, which is traditionally the case in historically stable September.

 

If you are comparing sales, etc., from September 2021 to September 2022, the following statistics are:

 

  • Total showings (month/month) 28,452 to 19,034, -33% change
  • Total closed sales (month/month) 931 to 523, -43.8% change
  • Total pending sales (homes under contract) (month/month) 1,085 to 619, -42.9% change
  • Median closed price (month/month) $455,500 to $555,000, +21.8% change
  • New listings (month/month) 985 to 694, -29.5% change
  • Total active listings (inventory) 1,387 to 2,146, +54.7% change
  • Average days on the market 24 to 40, +66.7% change
  • Single-family closed sales (month/month) 454 to 258, -43.2% change
  • Single-family median closed price (month/month) $615,000 to $682,500, +11.0% change
  • Single-family inventory 883 and 1,379, +56.2% change
  • Condominium closed sales (month/month) 477 to 265, -44.4% change
  • Condominium median closed price (month/month) $355,000 to $446,520, +25.8% change
  • Condominium inventory 504 to 767, +52.2% change

I published all these statistics because they give you an excellent insight into our current market if you wish to see the full market report ( CLICK HERE ).

 

What does it all mean?

 

The statistics above show the market is shifting from a "Sellers' Market" to an "Even Market."

 

Unfortunately, when Hurricane Ian made its crashing entrance, the national news showed all the devastation that occurred in Southwest Florida. I had friends and family that thought Naples was underwater.

 

My company received numerous calls from around the world from owners and renters to find out the status of the livability of the Naples area. The bad news was that if you were West of 41, near the coast or on the beach, you most likely experienced flooding. There was very little damage if you lived or owned East of 41. Hurricane Ian was not a wind event but a storm surge event for Naples. Fort Myers Beach, Sanibel, Captiva, and Cape Coral not only received storm surges but also high winds as Hurricane Ian pushed its way farther North and East when it made its landfall, making them the hardest hit areas.

 

The one bright spot is that the clean-up and rebuilding are the fastest I have ever seen. 85% of restaurants, golf courses, etc., are open for business. If you drive East of 41, you would be hard-pressed to conceive there was a hurricane here. The devastation was all storm surge related on or near the coast.

  

Unfortunately, many people were displaced if they lived along the coast. Some stay with friends and family, while others seek short-term or annual rentals. For example, rebuilding a home in the hardest-hit areas will take at least a year or more. Therefore, rents are at a premium. For those owners that did not have damage, this may be an opportunity to rent their properties. Not only will they be able to help someone in need, but receive a rental income.

 

Who's buying now?

 

Naples continues to grow. People are coming here for their jobs and are seeking to purchase. It's a bit harder because the interest rates continue to climb, but there is still demand.

 

Another demand is owners with large homes damaged on the coast. They still want to live in Naples, so some displaced people are purchasing properties to live in during the repair/rebuild process. They figured once they moved back into their original home, they could either sell their temporary property or use it as an investment property.

 

Investors are swooping in as well. Some people had extensive damage and did not want to go through the rebuilding/repairing process. Therefore, they are lowering their prices and putting their properties on the market significantly lower than fair market value knowing the amount of money needed to bring it back to where it was before Hurricane Ian.

 

Best advice

 

For those people who were affected by the storm, work closely with your insurance company. Document what you need to document and understand what your policy covers. Insurance companies can reimburse you for your temporary housing, community assessments levied for clean-up, failed equipment, and other damages. Make sure you know what you are entitled to and put in a claim.

 

 

If you have questions concerning buying, selling, or renting, don't hesitate to contact me at 239-293-3592 or via e-mail at  Robert@NardiRealty.com . In addition, you can always perform your searches at  www.NardiRealty.com .

Posted in Market Updates
Oct. 15, 2022

Market Watch October 2022

Selling & Finding a 55+ Community

By Robert Nardi

Indications that the Naples area housing market is transitioning to a balanced market became more evident during August as inventory and days on the market increased. According to the August 2022 Market Report by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island), overall inventory increased 71.3 percent to 2,140 properties from 1,249 properties in August 2021. Of the homes on the market during August, 35.8 percent of them (766) experienced a price decrease, and the overall list price received for the month slipped slightly to 96.4 percent from 99.2 percent in August 2021. These seller and buyer behaviors resemble a healthy market environment.

 

The overall median closed price continued to increase in August, up 30.7 percent to $575,000 from $440,000 in August 2021. Only 31 single-family homes and 79 condominiums under $300,000 were on the market during August. In August 2019, there were over 1,400 properties on the market for under $300,000. We are on par with new listings compared to pre-pandemic levels in August 2019. There were 850 new listings in August, a 16.9 percent decrease compared to 1,023 in August 2021.

 

The NABOR® August 2022 Market Report compares single-family home and condominium sales (via the Southwest Florida MLS), price ranges, and geographic segmentation and includes an overall market summary. NABOR® sales statistics are in a chart format ( CLICK HERE).

What does this all mean?

Once again, from all indications, we are moving to a balanced market. Supply and demand are starting to even out. This balance can be attributed to longer days on the market, fewer showings than in the past, and slight price decreases, so inventory appears to be more significant. A balanced market is not such a bad thing. Buyers and Sellers get to play in the same sandbox and come up with a fair market price to sell and buy!

A great time to Sell if you are a Senior!

 

If you are a Senior, I believe it is a great time to sell in Southwest Florida. Prices are still up, and it is an ideal time to purchase if you are thinking about a 55+ community. It seems like 55+ communities are popping up all over the place. What’s nice about these communities is that there is something for everyone. Some only have single-family homes and offer numerous amenities, even walking/biking trails, and water activities like kayaking. Other communities have step-down facilities. You would start in Independent Living, then move to Assistant Living, Memory Care, and even skilled nursing offerings. In some 55+ communities, you have ownership, while others are simply “renting” the unit.  Most charge a more significant monthly maintenance fee, but you can get a big bang for your buck. Some include chauffeured visits to your doctors, shopping, dinner, etc. Others have activities on campus where you can play bingo, sing karaoke, watch a movie, participate in exercise classes, do water aerobics, etc. Some have meal plans, and some cook breakfast, lunch, and dinner for you.

 

After Hurricane Ian, many of these 55+ communities did very well. Many are newer and built to withstand a category four hurricane. They are also equipped with generators and have a built-in care system for Seniors. You most likely would not be without a meal or the use of an elevator.

  

If you are not ready to sell but still want to move to a 55+ community, it may be a great time to put your property up as an annual rental. Unfortunately, many people lost their ability to live in their homes/condos based on the damage caused by Hurricane Ian. It would be a win-win for both you as the Landlord and the Tenant. You have a stream of income every month, and a tenant has a place to stay for a year while they rebuild.

 

Are you thinking of renting, selling, or buying? Do you need some guidance with 55+ communities? Nardi Realty can help; please feel free to call me directly at 239-293-3592 or send an email to Robert@NardiRealty.com 

 

Please stay safe, healthy & happy. 

Posted in Market Updates
Sept. 20, 2022

Market Watch September 2022

Still on the Road to a Balanced Market

By Robert Nardi

Naples's housing market experts reviewing the July 2022 Market Report by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island), confirm the data reflected normal activity levels akin to pre-pandemic summer months. Historically, closed sales in Naples during the summer months trend at around 800 sales a month. But during the last two years, summer sales were well above 1,000 closed sales a month. This July, overall closed sales decreased 43.4 percent to 662 closed sales from 1,170 closed sales in July 2021. For perspective, in July 2018 and 2019, there were 774 and 829 closed sales, respectively. The current activity is what market experts expected in a post-pandemic summer. It signifies that we are on a path back to a balanced market.

 

Additional indications in the July report supporting this shift are the number of pending sales. Overall pending sales decreased 33.8 percent to 751 pending sales from 1,135 pending sales in July 2021. The tempering of closed and pending sales, which began in June, produces one very welcome result: an increase in inventory. In July, inventory rose 87.6 percent to 2,429 properties from 1,295 properties in July 2021 (there were 5,200 properties in inventory during July 2019). There were 905 price reductions in July compared to 293 in July 2021. But demand is still very high. The median closed price in July increased 16 percent to $545,000 from $469,950 in July 2021; it decreased 9.8 percent from $604,000 in June.

 

The NABOR® July 2022 Market Report compares single-family home and condominium sales (via the Southwest Florida MLS), price ranges, and geographic segmentation and includes an overall market summary. NABOR® sales statistics are presented in chart format ( CLICK HERE ) for those who like statistics.

 

What does this all mean?

 

As I stated in previous newsletters, we are on the road to a balanced market. Our inventory is going up, and even though there is demand in the market, prices are minimally coming down. On average, they are coming down 5% where before, listings were selling at asking or above. However, price reduction depends on the location. As they say, it is all about "Location, Location, Location" in real estate. Properties near or on the beach are still in the highest demand. Prices there most likely will not go down, but they will probably go up. I recently put a three-bedroom, two-bath home on the market West of 41, three and a half miles from the beach, and I was able to get it under contract within three days. I had two offers in hand. Usually, my seller would say, "Let's do the highest & best!"  However, this strategy in this market does not work as well as in the "buying frenzy" market. If I say, "Highest & Best" in this market, some buyers will drop out, not go up in price (keep the same offer), or then there would be one that would raise their price but add "extra's in the contract" like furnishings, televisions, etc. Adding items to the contract would never happen at the height of buying because the demand was so great. The bottom line is buyer's urgency to purchase has dissipated. They hope the inventory will continue to grow, giving them more choices. Therefore, the days of 20-30 multiple offers are gone.

 

What's happening with the rental market?

 

It appears that the seasonal rental market demand is slowing, and prices are coming down slightly; therefore, a good sign for people who wish to be here in season and make a "last minute" booking. However, month choices may be limited.  

 

The annual rental market is still moving. However, landlords must be realistic with pricing. Yearly rents have gone up significantly since last year, but some annual rents are higher than they should be. If you have a yearly rental, price it accordingly, and it can rent quickly.  Why keep it on the market for one to two months at a higher price? You would be losing money. Like selling, price it right, and it will sell/rent.

 

If you are considering taking a plunge into the rental market, either putting a property up for rent or renting annually/seasonally, please contact Jessica Martin, my Rental Administrator, at 239-631-9447. She can talk to you about your potential rental property or find an annual/seasonal rental.

 

Where to find us!

 

As a reminder, you can perform your property/rental searches at  www.BuyNaples.net  or find us on Facebook at  www.facebook.com/nardirealty  or on Instagram at  www.instagram.com/nardirealty .

 

 

Fall is coming! Enjoy the change in weather. As the winter months come upon us, please think of us for your buying, selling, and/or rental needs as you make your entry or return to Southwest Florida.

Posted in Market Updates
Aug. 26, 2022

Market Watch August 2022

Price Reductions & More Inventory

By Robert Nardi

Data reflecting the Naples area housing market activity during June showed signs of a return to pre-pandemic summer activity when market conditions were balanced. According to the June 2022 Market Report by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island), pending sales decreased 36.8 percent in June to 794 pending sales from 1,236 pending sales in June 2021. In addition, closed sales fell 38.4 percent in June to 952 closed sales from 1,545 closed in June 2021. On the positive side, an 80.5 percent increase in inventory during June to 2,294 properties from 1,271 properties in June 2021 should spark sales. With 2.2 months of inventory available in June (up from .8 months in December 2021), the journey back to a balanced market is starting to take place. In addition, nearly 50 percent of our inventory this past June had a price reduction. These price reductions should be viewed as new listings because the newly lowered price is now attractive to a larger pool of buyers. Thus, there are more opportunities available for home buyers.

The NABOR® June 2022 Market Report compares single-family home and condominium sales (via the Southwest Florida MLS), price ranges, and geographic segmentation and includes an overall market summary. In addition, NABOR® sales statistics are presented in chart format ( CLICK HERE ) for those that would like to see all the statistics.

Median closed prices in June increased 31.8 percent to $604,000 from $458,281 in June 2021, but median closed prices for single-family homes decreased 7.7 percent to $750,000 in June from $812,500 in May. Conversely, median closed prices for condominiums in June increased 2.5 percent to $497,000 from $485,000 in May.

What does this all mean?

If you live in Naples all year round, you will notice that restaurants have fewer patrons this summer because fewer people are here. Why? Because with COVID restrictions lifted, there is no immediate need to get down to Florida to live a “normal” life. During the beginning COVID years, even people who owned here stayed throughout the summer. They were hoping that their state would lift the mask mandate, etc. Therefore, fewer people are down here, and thus, there is less demand. Also, for two years, Florida was a preferred vacation area. All states have lifted the mask mandate and opened up. Therefore, tourists are going to other vacation areas within the United States of America and abroad.

International travel has increased, and it appears many are enjoying Europe or domestic travel like Alaska, which seems very popular. On the upswing, international travel is making its way back slowly to Naples.

Add to the mix higher mortgage rates, worries about a possible recession, an ailing stock market, and inflation all contribute to demand tapering off. When demand lessens, inventory increases, and prices decrease. However, the price decreases I am seeing are minimal, not drastic. I still believe that these slightly lower prices will be more attractive to buyers, but we will not have the debacle of the great recession of 2005.

Rentals are still in high demand!

If you are a senior and decided to live in an independent living facility instead of just selling your home outright, it may be a good time to rent it annually. Especially if you have a single-family home with a pool, it is the most sought-after rental that we have in our inventory. Annual rent could be anywhere from $4500 and up, depending on the condition, location and amenities offered. Also, moving your home from your homesteaded domicile to a rental can provide quite a few tax advantages. You may want to discuss it with a real estate attorney or accountant.

What does the future hold?

Our inventory is going up, and I believe we will have a market where supply and demand will be in equilibrium over the next two years. The economy will be more robust, and inflation will taper off, and once inflation is under control, then mortgage interest rates will come down. Therefore, even if you are buying today at a higher mortgage interest rate, you can always refinance in the proceeding years once the interest rates come down.

Lastly, Southwest Florida is still attractive to buyers and always will be. The weather, beaches, low real estate taxes, no state tax, highly rated hospitals, and an overall strong economy. By the way, Collier County has the lowest real estate taxes in Florida. 1.25% plus if you homestead, you get an additional $650 deducted from your tax bill at the end of the year. What’s not to love?

Enjoy the rest of your summer! Before you know it, Fall will be upon us! 

Posted in Market Updates
July 11, 2022

Market Watch July 2022

Highest Number of Listings, May 2022

By Robert Nardi
May had the highest number of new listings in the last three years than any May. Fellow brokers who also analyzed the NABOR® May 2022 Market Report are pleased with this trend as it will lead to more options for summer buyers. New listings during May pushed the inventory of homes for sale up 58.6 percent to 2,046 properties compared to 1,290 properties in May 2021. By the end of May, our inventory in Naples has nearly doubled since the same time a year ago. And if you include the 889 homes that had a price reduction in May in this inventory mix, then we're in good shape for the summer months. Price reductions are like new listings because the home's new price point becomes a unique opportunity for a larger pool of buyers. Brokers like me prefer to compare this year's activity to the activity in 2019, as it was a balanced year with a 7.3-month supply of inventory. A healthy market for us is six to 12 months of inventory.

 

 

There was a 24.5 percent decrease in May to 1,249 closed sales from 1,654 closed sales in May 2021. However, using 2019's balanced market activity as a comparison, closed sales increased 7 percent month/month and 18 percent year to date. Demand remains strong despite having three times fewer inventory options than 2019 levels. Today, we have a 1.9-month supply of inventory.  The median closed price increased 40.3 percent in May to $608,000 from $433,500 in May 2021. Since January, we've seen a 21.9 percent increase in the number of homes sold in the $500,000 to $1 million price category.
  

The NABOR®, May 2022 Market Report, compares single-family home and condominium sales (via the Southwest Florida MLS), price ranges, and geographic segmentation and includes an overall market summary. For those who enjoy statistics, the NABOR® market report is in a chart format ( CLICK HERE ). 

 

What does this all mean?

 

The red-hot Naples Market from June 2021 through March 2022 is starting to cool. As mentioned, inventory is increasing, and we still have demand, but having multiple Buyers throwing in competing offers is becoming rarer. However, a larger supply is not the only factor. Interest rates are climbing. The stock market is down 35%, and we are experiencing rapid inflation.

 

All this news is not copasetic for the average Seller, but Buyers are sighing with relief. They still are not in the driving seat, but they are sitting "prettier" than they were just a few months ago. Prices are coming down, but not significantly. Why? Because Naples and the Southwest coastland have been undervalued compared to other coastal cities. The market in the past year has made its correction.
 

Everyone who purchased a home during this time paid cash or financed. In fact, in May, 63.3% of purchases in Naples were cash. Today, financing is not an easy task because the underwriting process is so regulated and rigorous that everyone financing can afford to purchase. It is very different from the "Great Recession" and the housing industry's collapse during that period.

 

What about the Rental market?

 

Seasonal rentals (January, February, and March) in 2022 were booming. Demand was so great that monthly rentals rates increased by at least 20%. In 2023 there is still demand, but not the kind of demand we had earlier this year. Because Florida opened earlier than most states, many people flocked in 2020, 2021, and the beginning of 2022. However, most of the United States is now open and has lifted the mask mandate, so there was no reason for these people to head south. Therefore, the rental market is starting to soften here, and monthly rental rates for seasonal and annual rentals are decreasing by an average of 5%.

 

The cache of the Southwest Florida Market

 

The Southwest Florida market is still very appealing, and people want to live here. In fact, out of the 25 fastest-growing cities in 2022, Florida has 11 cities on the list, and Naples and Fort Myers are two of those cities.

 

Florida has the tenth-best quality of living in the country. Florida's economy is one of the strongest in the nation, with a GDP of over $1.1 trillion. Florida would be the fifteenth wealthiest nation in the world if it were a country. The economy also continues to grow, with over 500,000 jobs added last year. Our beaches, quality of life, and being a tax-friendly state is unmatched.

 

If you need assistance selling, buying, or renting, please contact me at 239-293-3592 or send an e-mail to  Robert@NardiRealty.com . I am here to help!

 

 

Enjoy the rest of your Summer!

Posted in Market Updates
June 14, 2022

Market Watch June 2022

Housing Market is Starting to Balance

By Robert Nardi

During April, the overall inventory in Naples increased 16.5 percent to 1,668 properties from 1,432 properties in April 2021. After reviewing the April 2022 Market Report by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island), the Naples area housing market appears to be making a turn toward a balanced and healthy market. With the swell of new single-family home listings, up 5.7 percent over last year, and with 549 price reductions (33 percent of the inventory), we have 1.5 months of inventory, the highest level since March 2021. However, demand for the Naples lifestyle remains strong. Days on market for April were 16 days, considerably less than the historic 90-day average.

In April, the overall median closed price increased 39.2 percent to $599,000 from $440,000 in April 2021. Median closed prices continue to rise in the single-family home market, up 8.7 percent from March, but median closed prices during April in the condominium market decreased 1.1 percent from March. One "stand-out" observation is that with the increased appreciation over the past year, and the depletion of properties listed at $300,000 or less, there were only 96 properties below this amount in April 2022. Wow!

 

If you want to see the NABOR® April 2022 Market Report in chart form,  CLICK HERE . It compares single-family home and condominium sales (via the Southwest Florida MLS), price ranges, and geographic segmentation and includes an overall market summary. 

 

What does this all mean?

 

It simply means that the Naples market is starting to correct itself, however, do not count on prices plummeting. We see a lot of price decreases, but that is because these properties were overpriced, to begin with when they hit the market. The current market is dictating the selling price.

 

In 2004 & 2005, mortgage lenders financed Buyers through no-doc loans, which accelerated demand, causing properties to increase in value dramatically. It was relatively easy to get a mortgage by simply stating yearly income, running the Buyers' credit score, and performing a desktop appraisal. However, in today's housing market, Buyers getting a mortgage must go through a tremendous amount of scrutiny when securing a mortgage. Several of my customers have complained about the underwriting process because it feels like an "invasion of privacy." Also, the Naples area is in a bit of a bubble because many people sell their homes for large amounts of monies in coastal regions and then purchase in cash here. In fact, in April 2022, 66.7% of property buyers paid cash. Therefore, people waiting on the sidelines for prices to drop dramatically will be waiting a long time. It will not be a repeat of the "Great Recession" because everyone who is purchasing can afford to buy the property.

 

What should you do in this housing market?

 

If you are a Seller in Southwest Florida, then sell your property. If it is not moving, it is likely priced too high and will need a price deduction. I am not saying a significant reduction, but some reduction. Because the market is correcting, it will take longer to sell your property. Please keep that in mind.

If you are a Buyer in Southwest Florida, keep your eye out for properties entering the Multi-Listing Service (MLS) every day. You can also enlist the help of a REALTOR® to assist you. A REALTOR® can set up automatic searches for properties with the same characteristics or if you are looking in a particular area or development. Once a property comes on the market, you will need to act quickly on it. Make an appointment immediately and if it is something you like, put an offer in with few contingencies.

The NABOR® contract's three major contingencies are financing, inspections, and closing date. My best advice for those who have cash but want to get a mortgage is to select "Cash" on the contract. In essence, you are waiving all financing contingencies; however, you most likely can get approved for a mortgage in 35 or fewer days. Therefore, when selecting a closing date, I would make 40+ days from the effective date (when both parties come to terms and sign).

 

I would tighten the time frame from 15 to 10 days as far as inspections go. In addition, I would seriously consider an "As Is" contract that would allow you to inspect within the designated period. If you find something wrong with the property, you can walk away and receive your escrow monies back. However, if you see something wrong and still want the property, then "As Is" means precisely that. You are saying that you will not request from the Seller any remedial action or a credit at closing to fix those items.

 

Once the inspection period is over, then the only other contingency is the closing date. The NABOR® contract makes the closing date, "Time is of the essence." You must close on the date specified in the contract. According to the agreement, if you refuse or cannot close, the escrow money you put down is forfeited. The Seller is entitled to this money as "damages." You can always ask for a closing extension, but I highly doubt they would extend the closing date because it is a Sellers' market.

 

Need help with any of this? Please feel free to write me at Robert@NardiRealty.com or phone me at 239-293-3592. Enjoy your summer!

Posted in Market Updates
May 9, 2022

Market Watch May 2022

Some Price Reductions but still a Sellers' Market

By Robert Nardi

Demand for the Naples lifestyle remains strong as closed sales in March increased 49.9 percent compared to those reported in February. Although closed sales decreased 36.5 percent to 1,205 in March 2022 from 1,899 in March 2021, the increase from February to March was a welcome result of a steady wave of new listings. According to the March 2022 Market Report released by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island), new listings decreased only 4.3 percent to 1,637 new listings from 1,711 new listings in March 2021. If this wave of new listings remains steady during the coming months, it could mean more options for buyers navigating the area’s limited inventory.

 

The March report showed that inventory decreased 23.5 percent to 1,392 properties from 1,819 in March 2021. However, the good news is that March inventory increased 20 percent compared to inventory levels NABOR® reported in February (1,176 homes). In March, more homes for sale meant sellers enjoyed 43,206 showings that ultimately inspired 1,611 pending sales (homes under contract). The median closed price increased in March, up 39.6 percent to $575,000 from $412,000 in March 2021, and 62.7 percent of the month’s closings were cash sales. The NABOR® March 2022 Market Report compares single-family home and condominium sales (via the Southwest Florida MLS), price ranges, and geographic segmentation and includes an overall market summary. NABOR® sales statistics are in chart format ( CLICK HERE )

 

The March report showed about a third of the homes for sale (417) decreased in price during the month, a typical scenario where sellers list their property at a high price at the beginning of the winter season. Then as the season ends sometime after Easter, they reduce the listing price with the hope of selling their property before they head back to their primary home. There were 51 percent more price decreases in March than in February, indicating that they were too high for the market.

 

What does this all mean?

Higher mortgage interest rates and the increase in inventory are having a direct effect on slightly lowering prices. Condominiums and single-family homes are coming onto the market more rapidly. The season is over, and properties have been used or rented. Snowbirds and landlords decide to sell to "ride the wave." As of today, there are 1422 properties available in Naples, Florida. Just three months ago, there were only 825 properties available for sale. Inventory has gone up 58%!

The median price jumped nearly 40% from a year ago, reflecting economic theory. When you have lower supply and higher demand, prices go up. Southwest Florida, for years, has been undervalued, and it was time for it "catch up" with other coastal cities.

Naples, FL, is in the news for its ideal weather, beaches, and quality of life. Recently,  Healthgrades recognized Naples Community Hospital Health System as being in the Top 5% of Hospitals in the U.S. for Patient Safety Excellence. Impressive for Collier County, where there are only 370,000 inhabitants in season and 250,000 inhabitants out of season.

Advice

If you are a landlord or a snowbird and wish to sell, I would do it sooner than later. I do not believe that prices will go down significantly, but I think days on the market will be longer. There is always an unknown of other listings coming on the market, either the same model or square footage in your community or area, at a lesser price. Recently, I listed a single-family home, and a similar model came on the market for thousands less. There was no comparison because the newly listed house was barebones, builder-grade, and sat on an inferior lot. Yet, Buyers for my listing were throwing out low ball offers. It was like comparing apples to oranges, not apples to apples. However, Buyers see the prices going down slightly and think now they can get a deal. Prices are only going down because they were priced too high from the start. It is still a Sellers' market and will remain that way for many more months until the market is in equilibrium. 

My best advice is to find a REALTOR® that understands the market and can price your home based on comps, knowledge, and experience. They also have access to licensed handypersons, electricians, plumbers, housekeeping, professional staging companies, real estate attorneys, title companies, etc. Working with a skilled REALTOR® can be invaluable and make the selling process so much easier.

 

Any questions or need assistance, please feel free to contact me at 239-293-3592, send an email to  Robert@NardiRealty.com or search at BuyNaples.Net.

Happy Mother's Day!

Posted in Market Updates
April 10, 2022

Market Watch April 2022

Sellers making the right move!

By Robert Nardi

More sellers are motivated to enter the market as home values continue to rise because of limited inventory and high demand in the Naples area. According to the February 2022 Market Report released by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island), the overall median closed price in February was $550,000, a 37.5 percent increase over the median closed price in February 2021. The number of showings demonstrates the high demand for homes in February, 43,032. When divided by the number of homes in inventory during February (1,176), it averages 36 showings per home. For perspective, in 2019, there were 2.9 showings per home. The data also shows that homes sold fast in February, within 23 days on the market, and the percent of list price received was 100.6 percent, which pleased many sellers. While inventory during February decreased 47.1 percent to 1,176 homes from 2,224 homes in February 2021, the actual inventory number is higher because the report does not capture the number of off-market listings.

 

In February, the median closed price increased 37.5 percent to $550,000 from $400,000 in February 2021. It appears that the median closed price is starting to stabilize. It only increased .2 percent from January to February, and the report shows February had more price decreases [276] during the month than price increases [170]. During the years leading up to the pandemic (2017-2019), Closed sales in February averaged in the low 600s. Still, demand for the Naples lifestyle and the amenities have driven buyers to the paradise coast in record numbers in recent years. It is only due to a lack of inventory that home sales in Naples did not fare as well as last February. Overall, closed sales decreased 39.5 percent to 804 in February from 1,330 in February 2021. The only area where we see a decrease in closed sales over the last year is the $300,000 and below range because there were only 26 single-family homes at this price level.

 

The NABOR® February 2022 Market Report compares single-family home and condominium sales (via the Southwest Florida MLS), price ranges, and geographic segmentation and includes an overall market summary in chart form ( CLICK HERE ).

 

What does this all mean?

 

It continues to be a Seller’s market. I recently listed a two-bedroom/two-bath condo in North Naples for $249,900. Great location and schools. It was over 1150 sq. ft. of living area. Within a few days, I received over 30 highest and best offers. Yes, 30 offers, you read correctly. With this large number of competing bids, it sold for a much higher price. I worked with my Seller to create a strategy for producing offers, and then when offers were rolling in, I had to categorize each and break down their terms in a language my Seller could understand. In addition, offers have become very complicated with escalation clauses, appraisal waivers, cash vs. a mortgage contingency, etc. Five seemed to contain the best terms and pricing out of the submitted offers. Out of the five, one had the least number of contingencies and the highest price. That offer won the race.

 

My best advice to all Sellers out there is not to do a “For Sale by Owner” unless you are willing to take a lower offer or know the person and want to give them a discount concerning pricing. It is essential not to go alone in this market if you are a Seller and utilize a REALTOR®. Why not maximize one of your greatest assets?

  

Renting after Selling?

 

Sellers need to have a game plan because the property will sell and perhaps sell quickly. Therefore, one option they have after closing is to rent. However, the rental market is like the sales market; very tight and has few choices. Recently, Naples, Florida, was deemed one of the most expensive cities for rentals in the national news. On average, renting a two-bedroom/two-bath condominium annually is $2000 per month.

 

Demand has increased 100-fold regarding seasonal rentals, and therefore, monthly prices have increased anywhere from $1000 to $3000 per month. Other factors that fuel the fire are its distance to the beach or if it resides in a resort community. Nardi Realty has a waiting list of 350 people seeking rentals from January through March of 2023, and willing to pay $4000 per month for a small condo to $42,000 per month for a luxury high-rise on the Gulf of Mexico. Simply mind-blowing!

 
The best advice I can give to Sellers is to do their due diligence and have a moving plan. Don’t leave anything up to fate.

 

Posted in Market Updates