October 2023 Inventory is Up!

By Robert Nardi

Real estate brokers reviewing the October 2023 Market Report by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island), were encouraged to see a 31.8 percent increase in new listings to 1,231 new listings from 934 new listings in October 2022. The report also showed the median closed price of homes in Naples during October increased 4.5 percent to $580,000 from $555,000 in October 2022. According to broker analysts, these two factors indicate rumors of an extreme market correction were false. They also illustrate renewed seller confidence, which will be good news for buyers seeking more options in the coming months.

October had the highest number of new listings added to the market compared to any October in the last two years. Historically, and according to NABOR®’s monthly market reports, October and January have the highest number of new listings. New listings in October for the condominium market shot up 61.9 percent to 612 new condominium listings from 378 new condominium listings in October 2022. Single-family home new listings in October also increased at a healthy rate of 11.3 percent to 619 new single-family home listings from 556 new single family homes listings in October 2022. Pent up consumer travel during the summer distracted attention away from home sales as the report showed both pending sales (homes under contract) and closed sales activity were lower than pre-pandemic levels reported for October. This can be traced to lower showing activity during the recent summer compared to summer 2022 levels. As such, overall pending sales in October decreased 1.2 percent to 665 pending sales from 673 pending sales; and overall closed sales in October decreased 12.8 percent to 594 closed sales from 681 closed sales in October 2022. Higher days on the market also contributed to lower sales in October.

Sales of luxury properties continue to drive the metrics for the real estate market in Naples. Looking at October’s market report the average closed price of all properties – year to date – in Naples is over $1 million. And compared to last October, there are now 275 homes for sale in the $5 million and above price category, a 55.4 percent increase.

The NABOR® October 2023 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. NABOR® sales statistics are presented in chart format (CLICK HERE) for those of you who like to see all the statistics.

What does this mean?

One factor contributing to a rise in new listings this October was the need for many homeowners to postpone listing their properties for sale last October until damage from Hurricane Ian could be repaired.  Surprisingly, interest rates are not as much an obstacle in Naples as cash sales continue to exceed 50 percent of all our sales, but they are for many northern home sellers who rely on buyers that require financing. There’s talk that some buyers are also sitting on the fence waiting for rates to drop.

I have a listing in Golden Gate Estates.  A beautiful home on 2.34 acres.  We have had the gambit of showings and some offers.  Several “low ball” offers were thrown into the mix.  I think these are investors who want to make a quick buck.  They are hoping there are some distressed sales out there.  So, they go “fishing” and hope to catch “the big one!”  Yet, with this home, we did have a buyer that fell in love with it, but he must sell his home up north before he can purchase in Naples.

The good news for buyers is that the percentage of list price received has decreased 2.7 percent and 3.5 percent in the single-family and condominium market over the past 12 months, respectively. There were also 1,004 price reductions in October, basically a third of all homes for sale. If inventory continues to rise at its current pace, there will likely be more opportunities for buyers to negotiate.

Rental Opportunities

During COVID Florida was booming.  Many people stayed here all year round because they did not want to be in states that sanctioned tougher COVID restrictions.  Now that COVID restrictions have been lifted, not as many people are seasonal renting here. They have an opportunity to rent somewhere else.  For years, my rental department had a waiting list for seasonally rent properties, but that no longer is the case.  This now is having a direct effect on rental prices.  They care coming down for both annual and seasonal rentals.  Therefore, if you are thinking about coming down to Southwest Florida, you would have a nice selection of rentals to choose from.  If you have any interest, please feel free to contact Sheri Martin, my Rental Administrator at 239-571-6189 or send her an e-mail at sheri@teamonesource.com.

 

I wish you Happy Holidays and a very Healthy, Happy and Prosperous New Year!  2024, where has time gone?