As always in Naples, the real estate market has nuances from neighborhood to neighborhood. I have said it before and I will say it again a thousand times over lest anyone forget that important point! As an example, just looking at single family homes west of Route 41 (Tamiami Trail), the real estate market will always be different in Pelican Bay versus canal homes in Conners at Vanderbilt Beach versus investor opportunities in Naples Park. The reality is that supply and demand will always control the market.
Let’s bring you up to date from the period of the “COVID Property Rush” to the current market of today. We experienced never-been-seen-before demand combined with painfully low inventory driving prices up at a record price. There was a mass exodus from states that typically do not provide many of our buyers (New York , New Jersey, California, Texas) in addition to the usual suspects such as high tax states in the mid-west. People were escaping COVID lockdowns in search of living a normal life in the Sunshine State with fewer mandates, schools open, outdoor activities, and a “free” lifestyle. Working from home allowed many to be stationed wherever they chose.
Although most of the buyers in our area pay cash, the historically low mortgage interest rates helped and we experienced more purchases with mortgages than ever before. At the same time, the inventory of properties on the market for sale was low and consequently drove prices up in leaps and bounds. Although property owners loved hearing how much appreciation they have enjoyed, the first question out of the homeowner’s mouth was, “But where do I go?”
As prices increased so rapidly and reached levels that stopped making sense (again, different neighborhoods had different experiences), we began to feel some resistance to price. This is where our “finger on the pulse” and living / breathing real estate every day came up in our every day conversations. Many sellers and their agents were still promoting the idea of multiple offers and “Best and Final Offers by Monday at 5pm”, “Cash Only,, “As-Is Contracts” and “Sellers to Remain in Property 90 Days after Closing as a Convenience.” We still see some of that posture. It’s a smoke screen or disillusioned dreaming or bad advice from listing agents or ignoring the facts of the market or some combination of the above.
In short, those days are done. Anyone that tells you different is mistaken. Using one neighborhood of 3,000 single-family homes that is investor heaven because of its walking distance to beaches and no HOA restricting rentals, we went from an all time low of 7 homes on the market just a couple of months ago to 60 for sale today. Just the increase in inventory begins to level the playing field between sellers and buyers.
Here’s some advice to sellers:
*Price accurately for the location, condition, age and improvements to your home. Otherwise, you will be noted as “overpriced” and you will sit on the market. We are not falling off of a cliff, but there is a leveling off underway at this time.
*The market is going to tell you very quickly if you are priced competitively. If you are not getting interest and showings, then you are asking too much. If you list on the lower side, you will attract multiple offers and end up at market value.
*Get advice and consultation from more than one real estate agent. It is critical to have true information and honesty to make a good decision for the sale of your home. Your listing agent must have their “finger on the pulse” and be forward looking. This is not yesterday’s market.
*Presentation of your home or condo is important. Sticking it in the MLS system with photos from someone’s iPhone is not marketing for the best outcome.
*Timing is everything. Seriously. Do you want to be the only one in your neighborhood to be on the market for sale or do you list while a dozen neighbors are trying to sell? And then your neighbors start reducing their list prices.
Here’s some advice to buyers:
*Be patient as inventories will improve but be ready to take decisive action at a moment’s notice.
*Don’t make the mistake of thinking that the longer you wait, the more it is to your advantage. You will be left behind empty handed.
*When a home or condo comes on the market that meets all of your criteria and represents value to you, jump on it. There are still plenty of other buyers out there who are looking at the same properties for the same reasons.
*Give value to the things that are priority to you and you cannot change. In other words, if location, view and pet friendly are the most important factors then keep those as the “must haves”. Replacing flooring or renovating a kitchen are things you can change.
*June through October is going to be a good time to be a buyer. More inventory, less competition and motivated sellers.
*Timing is everything. The right place at the right price comes on the market for sale…….do you write a contract on Day One? Or do you wait until three other buyers are interested and now you have to compete?
We are here to serve and give you the best advice from years of experience in the Naples and Bonita Springs areas through all market conditions. Our current real estate market is leveling off with motivated sellers having to improve their prices. Call it a “correction,” if you like. There is still strong buyer demand as we are enter a much more balanced situation.
Remember, each neighborhood is different so contact us for our take on things in your particular area of interest. As always, it matters if your property of choice is a single-family home or a condo, pet friendly or not, boating access to the Gulf of Mexico or not and more.
Ask questions – we have the answers.
