Some Positive News for Housing in January
(Fort Myers, FL – February 22, 2017) – 2017 started off with a lot of positives for the Lee County housing market. Closed Sales, Pending Sales, Sale Price were all up in January. However, there were some statistics that were in the green that indicate more of a buyer’s market, including Months Supply and Median Time to Contract.
Starting out the new year, the number of Closed Sales were up for both Single Family Homes (46 more, or a 6% increase) and Condos (29 more, or a 7.6% increase), compared to the same time last year. Median Sale Prices rose almost 8% for Single Family Homes, and stayed level for Condos. Pending Sales jumped more than 18% for Condos in January, while Single Family Homes stayed about flat.
The number of Active Listings skyrocketed for Condos in January. There were 3,589 Active Listings compared to 2,708 in 2016 – a jump of 32.5%. Active Listings for Single Family Homes jumped 12%. Contracts are taking longer, with a Median Time to Contract of 61 days last month, compared to 55 days in 2016.
The Months Supply of Inventory last month was more than 18% higher than it was in January 2016.
The cities with the biggest jump in the number of Single Family Home Closed Sales last month were Sanibel/Captiva (35.3%), Pine Island (25%), and Estero (31.4%). Fort Myers Beach closed sales dropped 60% year-over-year, but the current median price for a home on the beach is $1,795,000 – an increase of 211.6% compared to last year.
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January Home Sales Strong
Naples, Fla. (February 17, 2017) – The new year rebounded with a strong gust of activity in the Collier County real estate market. Increases in overall pending sales (homes under contract), overall closed sales and overall inventory indicate a strong season ahead. Broker analysts who reviewed the January 2017 Market Report, which tracks home listings and sales within Collier County (excluding Marco Island) using the Southwest Florida MLS, are confident that market indicators are favorable to support momentum through season.
“We are definitely in a buyer’s market now, and home sales were strong in January,” said Phil Wood, President & CEO of John R. Wood Properties, who pointed out that the 6 percent increase in overall closed sales for January was driven by an impressive 14 percent increase in closed sales of condominiums. He remarked, “Properties that are selling rapidly are those that are priced at true market value.”
In response, Mike Hughes, Vice President and General Manager for Downing-Frye Realty, Inc., agreed with Wood adding that, “the increase in inventory is a positive opportunity, especially for buyers looking in the under $300,000 condominium market, which increased by over 400 units in January.”
According to the January Market Report, overall pending sales increased 9 percent to 924 pending sales in January 2017 from 847 pending sales in January 2016. Broker analysts said they are most encouraged by pending sales activity in the middle range of the market; namely, homes between $300,000 and $2 million, which all experienced double digit increases in January.
Overall closed sales increased 6 percent to 603 closed sales in January 2017 from 571 closed sales in January 2016. Interestingly, January was the first time both overall pending sales and overall closed sales were on the upswing simultaneously since March 2015.
The report also showed that overall inventory for all price segments increased by double digits in January too. Comparatively, condominium inventory in the $2 million and above category had the highest gain with a 44 percent increase to 135 condominiums in January 2017 from 94 condominiums in January 2016.
“Increases in inventory typically drive prices down,” said Kathy Zorn, broker/owner, Florida Home Realty. This was the case where the overall median closed price decreased 8 percent to $314,000 in January 2017 from $340,000 in January 2016. Notwithstanding, the jump in inventory for condominiums in the $2 million and above price category resulted in an 18 percent decrease in its median closed price to $2,850,000 in January 2017 from $3,495,000 in January 2016.
Zorn added that geographic proximity to the beach remains a driving force in the Naples real estate market. As such, properties located in the Naples Beach area experienced a 15 percent increase in overall median closed price to $784,000 in January 2017 from $680,000 in January 2016. Pending sales for the Naples Beach condo market for January 2017 increased by almost 40 percent compared to last year and closings were up 16 percent. This was mostly driven by a somewhat limited condominium market in the Naples Beach area, where inventory increased 34 percent and pending sales shot up 39 percent in January.
“Today, buyers have more choices,” Zorn said.
The NABOR® January 2017 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 2017 sales statistics are presented in chart format, including these overall (single-family and condominium) findings:
CATEGORIES January 2016 January 2017 CHANGE Total homes under contract (pending sales) 847 924 9% Total closed sales 571 603 6% Median closed price (month / month) $340,000 $314,000 -8% Total active listings (inventory) 5,091 6,393 26% Average days on market 75 91 21% Single-family closed sales 291 284 -2% Single-family median closed price (month / month) $425,000 $397,000 -7% Single-family inventory 2,715 3,219 19% Condominium closed sales 280 319 14% Condominium median closed price (month / month) $278,000 $265,000 -5% Condominium inventory 2,376 3,174 34%
“We are in a different market than we were a year ago,” said Jeff Jones. “The stock market is now performing very well, home sales are now very strong in northern states, and winter came early up north so people fled to Florida’s warm weather early too.”
Nationally, a balanced market (balanced equally between buyers and sellers) is considered to be six months of inventory. Yet, as observed by Adam Vellano, West Coast Sales Manager, BEX Realty - Florida, “Our report shows 8.91 months of inventory for January. The last time we had a supply of inventory like this was five years ago. I think it’s time to remind sellers that ‘price sells a home’.”
Many broker analysts including Zorn, Vellano, and Wes Kunkle, President and Managing Broker at Kunkle International Realty, said they have observed a large increase in investor held single-family homes being added to the inventory mix in recent weeks. Zorn pointed to signs of bracket creep in the report, such as a 23 percent increase in inventory for single family homes in the $300,000 to $500,000 price category, while its median closed price fell 4 percent. Jones also cited that days on market for single-family homes in the $500,000 to $1 million price category had doubled in January, while this price category’s median closed price actually rose 4 percent.
Responding to these observations, Cindy Carroll, SRA, with the real estate appraisal and consultancy firm Carroll & Carroll, Inc., warned that sellers who are testing the market with high list prices may be disappointed in a few months as “these sellers see a reduction in list price as a reduction in value, when this is not the case at all. Working with a REALTOR® who closely monitors comparable listings will help them avoid months of waiting for a sale.”
Zorn agreed and added that the cost of holding out for a higher price in many cases – especially for investors – could result in a loss of revenue from both rental income and unavoidable costs like taxes and insurance.
Contacts: Dominic Pallini, NABOR® President, (239) 597-1666 Marcia Albert, NABOR® Director of Marketing, (239) 597-1666