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.