SWFL Active Residential Inventory and Pending Activity for the first half of the year over the past 4 years!
Category: Real Estate News
Real estate leader Robin Sheakley, president of Sibcy Cline Realtors, received a text from a friend in Ohio asking for help in buying a house in Sarasota. Coincidentally, Sheakley happened to be in Sarasota at the time and was attending a dinner party hosted by Michael Saunders, founder of Michael Saunders & Co. Sheakley and Saunders see this as an example of the continued flow of homebuyers to areas on the west coast of Florida, despite some signs of weakness in the overall real estate market. They, along with four other realty brokerage leaders from around the state and country, spoke about the real estate market during a media session on April 26 at The Ritz-Carlton in Sarasota. The leaders were in town for a conference hosted by The Realty Alliance, a network of elite real estate brokerages across North America. They discussed the state of their home markets, trends, and what they see happening in Florida.
Inventory
Robin Sheakley notes that her company’s transaction volume in Ohio has decreased by 35% in 2023 due to a severe shortage of inventory. The other panelists, including Stephen Baird, President and CEO of Baird & Warner in Chicago, also report struggling with inventory. Baird, whose company is the oldest independent family-owned real estate services company in the U.S. and the largest independent real estate brokerage in Illinois, says his firm’s listings of homes for sale are down 50%. Despite high demand, they are unable to sell due to the lack of available homes.
Florida Pipeline
Despite facing challenges in the real estate market, including inventory shortages, the executives on the panel agree that Florida remains a popular destination for homebuyers. Ron Howard of John R. Wood Properties in Naples notes that many buyers seek second homes or condos in Southwest Florida for the weather and active lifestyle. John Horning of Shorewest Realtors in Wisconsin reports seeing an increase in dual ownership, with clients keeping condos in Wisconsin and buying another in Naples or elsewhere in Florida. Stephen Baird of Baird & Warner in Chicago also sees this trend, but believes the national stories of people fleeing Chicago and Illinois are overblown. Nonetheless, he recently opened a Florida office in Naples due to demand from his agents. Michael Pappas of The Keyes Co. in Miami says that people from the Midwest tend to head to the west coast of Florida, while those from the Northeast prefer the east coast. Some buyers are even purchasing homes in Ave Maria, 90 miles west of Miami, and commuting to Miami-Dade or Broward counties due to crowding in South Florida.
Insurance
Despite reforms to the state’s insurance market, affordable insurance remains a challenge for some homebuyers. Michael Pappas, president of The Keyes Co., notes that 80% of his firm’s clients are insured by Citizens Property Insurance Corp. due to lack of coverage options. Pappas also gives an example of the high cost of insurance in Miami, where he is paying $85,000 for insurance on a $3.5 million home. Some South Florida buyers in the higher price range have even decided to forego insurance altogether, according to Pappas.
Mortgage Rates
Panelists are advising clients that low mortgage rates of 3% or 4% are unlikely to return. However, Michael Pappas notes that even the current fixed-rate of 7.1% is better than it has been for at least 40 of the past 50 years. Buyers are being informed that this is the new normal, but they can purchase now and refinance later if/when rates go down. As Elizabeth Sheakley says, “you date the rate, but you marry the house.”
Design
Real estate executives see a trend towards more space, including backyards, pool areas, and ceiling heights, as well as better use of space, such as sliding doors. They note that the Mediterranean look is out and modern style is in, and that the outdoor lifestyle is popular. Michael Saunders & Co. has 20 sales offices and over 600 agents in Sarasota, Manatee, and Charlotte counties.
Click here to the entire article
During a public hearing on Thursday, the Cape Coral City Council unanimously approved the Hudson Creek planned unit development, which encompasses a mixed-use area. This 1,732-acre development is located in northwest Cape Coral, positioned east of Burnt Store Road and north of Jacaranda Parkway.
The project will comprise up to 3,500 dwelling units, with 2,500 of these being single-family homes. Alongside the residential components, the development will feature 425,000 square feet of retail and restaurant space, 500 hotel rooms, and 150,000 square feet of office space.
Moreover, the site has been designated for a potential 800-bed assisted-living facility and a 3,000-student university, but no discussions have taken place with interested colleges or universities. The proposed schedule of uses serves as a guideline for permissible developments that can be established on the site.
Over the years, some sections of the site have been part of Cape Coral, while other portions were annexed into the city at different times.
The entire site remains undeveloped, with no existing roadway access and no utilities present.
A central spine road will be constructed through the development, with access from Burnt Store Road, Wilmington Parkway, Jacaranda Parkway, and Chiquita Boulevard. The neighborhood roads will feature sidewalks on both sides, and the spine road will have bike lanes on both sides as well. Click here for the entire article
Closed Sales
Closed sales for the 12-month period ending October 31, 2022 were down 27.28% from the preceding 12-months, from 40,710 to 29,606. The 1,454 sales posted for the month of October were down 40.24% when compared to October of 2021, a time when the market was still posting a record-breaking sales pace. Compared with pre-pandemic trends, October sales were down 21%.
Listing Inventory / New Listings
As of October 31, 2022, 5,215 properties were available, up 102.5% from one year prior and down 3% from the prior month. New listings for the 12-month period ending October 31, 2022 were down 6.54% from the preceding 12-months, from 37,318 to 34,876. For the month of October, new listings were down 33.5% from October of 2021. 2.11 months of supply was posted as of October 31, 2022, remaining well into a sellers’ market territory. In Southwest Florida, 6 to 12 months of supply is generally considered a balanced market.
Average Selling Price
The average selling price for the 12-month period through October 31, 2022 was $766,357, up 23.2% from the preceding 12-month period when the average selling price was $621,936.
Summary
While other parts of the country have posted increases in available inventory in recent months, inventory in Southwest Florida has posted three consecutive months of modest declines. This already-declining listing inventory was exacerbated by October’s particularly slow pace of new listings due to Hurricane Ian, down 33.5% from the same period last year and down 49% from the pre-pandemic pace. After a temporary disruption during the weeks just after Hurricane Ian made landfall, the rate at which listings have been going under contract for purchase has largely recovered and is now in line with the pre-storm pace. Newly pended sales are now trending with the pre-pandemic pace our market has been mirroring for much of the year. Hard hit areas such as Fort Myers Beach and the Islands will take more time before sales move back to their normal pace; however, sales are starting to pick up in those areas. Influenced by Hurricane Ian, year-over-year declines in closed sales for September and October were steeper than those for the preceding months, but recent increases in newly pended sales suggest that such steep year-over-year declines may be short-lived. We will continue to follow the various Southwest Florida markets closely and will keep you informed.
Click here for the full market report
Our Southwest Florida Market Report for September 2022 includes the latest real estate data, as well as a comprehensive list of market conditions in SWFL. From inventory and sales activity to market trends, it all comes together in this monthly market report. Stay up-to-date and plan ahead with our monthly market reports!
Closed Sales
Closed sales for the 12-month period ending September 30, 2022 were down 26.7% from the preceding 12-months, from 41,559 to 30,480. The 1,449 sales posted for the month of September were down 44.8% when compared to September of 2021, a time when the market was still posting a record-breaking sales pace. Compared with pre-pandemic trends, September sales were down 14%.
Listing Inventory / New Listings
As of September 30, 2022, 5,375 properties were available, up 108.5% from a year prior but down 1% from the prior month. New listings for the 12-month period ending September 30, 2022 were down 5.4% from the preceding 12-months, from 37,884 to 36,836. For the month of September, new listings were down 26.6% from September of 2021. 2.12 months of supply was posted as of September 30, 2022, remaining well into a sellers’ market territory. In Southwest Florida, 6 to 12 months of supply is generally considered a balanced market.
Average Selling Price
The average selling price for the 12-month period through September 30, 2022 was $755,403, up 22.6% from the preceding 12-month period when the average selling price was $615,992.
Perspective
Other than some end-of-the-month closings that no doubt were cancelled or postponed due to hurricane Ian, statistics as of our September report show little influence from the storm. In coming months, as more data filters through, we will be better positioned to assess the level of influence the storm has had on our local markets, and we will be certain to report those findings to you. Clearly, new listings and sales in the most impacted areas such as Fort Myers Beach and the Islands will post initial declines and lower than normal activity during the recovery process. If history is any indication, less impacted areas are likely to experience an increase in demand, both from displaced residents seeking housing, as well as from buyers who were targeting the now-impacted areas, and instead may seek alternative locations, at least until the most impacted areas recover.
What we can report so far for the market-at-large is that since Hurricane Ian passed, after newly pended sales fell sharply in the days following the storm, the rate of newly pended sales has increased steadily and, as of October 7th, daily sales were already back to 73% of their pre-storm pace. That’s for all Collier and Lee areas from Marco up to Cape Coral and the Islands. We are optimistic that overall market recovery will be swift, just as has proved to be the case in the past after other storms have impacted Southwest Florida. And yes, some specific areas will take longer, but those areas, too, will indeed recover and reemerge brighter and stronger when they do.
Hurricanes and Real Estate
Generally speaking, after a period of slower-than-usual sales, real estate markets usually recover at a surprising rate. This proved to be the case with Hurricane Irma which hit Southwest Florida in 2017. Newly pended sales dropped by 90% just following the storm, then were back to their normal pace just five weeks later. Reviewing what history suggests about how storm surge impacted markets recover; after Hurricane Katrina in 2005, sales in the Metro New Orleans market fell noticeably for about a month’s time before they returned to, and then even exceeded, their prior pace. More recently, after Hurricane Harvey in 2017, a similar trend held true for the Houston Metro area. Every storm is different and every market is different, and it remains to be seen exactly how recovery will look for Southwest Florida, but early indicators are favorable. Historical post-storm trends, a strong resolve by residents to rebuilt, and a continued deep passion for Southwest Florida’s beauty and lifestyle by residents and visitors alike, all bode very well for a strong recovery.
Click here for the full market report
Our Southwest Florida Market Report for August 2022 includes the latest real estate data, as well as a comprehensive list of market conditions in SWFL. From inventory and sales activity to market trends, it all comes together in this monthly market report. Stay up-to-date and plan ahead with our monthly market reports!
Closed Sales
Closed sales for the 12-month period ending August 31, 2022 were down 24.7% from the preceding 12-months, from 41,906 to 31,541. The 1,876 sales posted for the month of August were down 30.8% when compared to August of 2021, a time when the market was still posting a record-breaking sales pace. Compared with pre-pandemic trends, August sales were down 13%.
Listing Inventory / New Listings
As of August 31, 5,420 properties were available, up 108.8% from a year prior but down 2% from the prior month. New listings for the 12-month period ending August 31, 2022 were down 5.4% from the preceding 12-months, from 38,564 to 36,467. For the month of August, new listings were down 7.5% from August of 2021. 2.06 months of supply was posted as of August 31, 2022, unchanged from the prior month and remaining well into a sellers’ market territory. In Southwest Florida, 6 to 12 months of supply is generally considered a balanced market.
Average Selling Price
The average selling price for the 12-month period through August 31, 2022 was $745,219, up 22.5% from the preceding 12-month period when the average selling price was $608,210.
Perspective
Over the past 18 months, after the pandemic-driven frenzy peaked in early 2021, the Southwest Florida real estate market has steadily moved back toward a state of normalcy. The rate of newly pending sales returned to pre-pandemic levels in May, and in June and July trended below pre-pandemic levels resulting in fewer than normal closed sales during the following months. However, after that June and July slowdown, newly pended sales started to strengthen and, by the end of August, were once again in line with pre-pandemic trends. This ebb and flow isn’t unusual, and it may be a good sign considering it’s a shift from a trend which, up until that point, was one of deceleration in newly pending sales. After steady increases from the low in February, listing inventory plateaued in August, posting a modest decrease from July. This is due to steady sales absorbing available inventory, as well as to a somewhat slower than usual pace of new listings entering the market in August. Listing inventory, at 5,420 units as of August 31, has a long way to go before it returns to pre-pandemic levels and, with 2.06 months of supply, we are still firmly in a seller’s market.
Click here for the full market report
Closed Sales
Closed sales for the 12-month period ending July 31, 2022 were down 23.2% from the preceding 12-months, from 42,071 to 32,295. The 1,911 sales posted for the month of July were down 38.7% when compared to July of 2021, a time when the market was still posting a record-breaking sales pace.
Listing Inventory / New Listings
As of July 31, 5,552 properties were available, up 112.9% from a year prior and up 4% from the prior month. New listings for the 12-month period ending July 31, 2022 were down 6.2% from the preceding 12-months, from 39,158 to 36,714. For the month of July, new listings were down 5.3% from July of 2021. 2.06 months of supply was posted as of July 31, 2022, keeping the market well into a sellers’ market territory. In Southwest Florida, 6 to 12 months of supply is generally considered a balanced market.
Average Selling Price
The average selling price for the 12-month period through July 31, 2022 was $730,978, up 21% from the preceding 12-month period when the average selling price was $604,220.
Summary
After two years of unprecedented sales activity, simply returning to a more normal pace can create an illusion that sales are struggling. Although sales have slowed down considerably from the all-time records that were created over the past two years, homes are still going under contract at a steady pace not far from pre-pandemic levels. The market has not suddenly stalled as headlines might lead one to think. Compared to pre-pandemic levels, buyer activity peaked in late 2020 into early 2021. After a generally gradual descent from that peak, newly pending sales have leveled out and they continue at a steady pace not far from pre-pandemic levels. This has allowed listing inventory to grow, providing buyers more options and reducing competition for properties. However, the rate at which listing inventory had been increasing has slowed, with only a 4% month-over-month increase in July. With this in mind, buyers waiting for an inventory surplus to emerge might consider whether waiting for the unknown is worth risking missing out on currently available homes that could be the right fit. With more listings for buyers to choose from, and with less competition between buyers, sellers will have to take this into consideration when pricing their homes and entertaining offers. This is not to say that it’s not a good time to sell; it is a good time to sell, but expectations for a seller are not the same as they were earlier in the year. Properly positioned homes can still sell for a good price in a reasonable amount of time, but a seller who has priced their home well above recent closed sales may have to reduce, and even when priced correctly it may take longer to sell than homes that closed even just a few months ago. Average days on market for closed sales in July was 21 days, up from a low of 15 days in April. The average for currently pending sales is 36 days; still low compared to the pre-pandemic average of 93 days.
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Closed Sales
Closed sales for the 12-month period ending April 30, 2022 were down 7.13% from the preceding 12-months, from 38,016 to 35,304. With the 12-month period through July 2021 marking the height of the buying frenzy with 42,071 closes sales, it comes as no surprise that 12-month rolling sales are now posting modest declines by comparison, and we should expect this trend to continue over the coming months as sales continue to normalize. Sales are still strong, however, with April 2022 posting 3,190 closed sales; an April sales pace only exceeded last year when 3,267 sales were posted for the month.
Listing Inventory / New Listings
2,590 properties were available as of April 30, 2022, up 3.31% from the same date in 2021. New listings during the twelve months ending April 30, 2022 were down 7.58%, from 39,179 to 36,210. After several months of year-over-year declines, monthly new listings for March and April posted increases of 5.91% and 3.34%, respectively.
Average Selling Price
The average selling price for the 12-month period through April 30, 2022 was $688,596, up 20.69% from the preceding 12-month period when the average selling price was $570,564.
Summary
While down 80% compared to pre-pandemic levels, listing inventory has posted slow and steady increases over the past three months. 2,590 homes were on the market as of April 30, a 27% increase from 2,035 posted in January. This is due in part to an increase in new listings in March and April, but also can be attributed to the pace of sales slowly cooling after several months of record-breaking activity. Compared to pre-pandemic levels, closed sales for the month of February were up by 31%. March reflected a 23% increase, and April’s closed sales were up 14% compared to pre-pandemic levels. This movement toward a closer-to-normal pace of sales is a welcomed trend for buyers desiring more options; however, with .88 months (27 days) of supply posted at the end of April, it’s clearly still a strong sellers’ market.
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INFLATION/ FED SPEAK/ GEO POLITICS
Higher inflation has been the main topic for several months and mortage interest rate market has been volatile.
Last week the markets were stunned by the high 6% CPI year-over-year increase and fun her stunned when Fed President from St Louis (Bullard) declared he wanted to see a 1% increase in the Fed Funds rate by July I, 2022. With only 3 meetings scheduled between now and July I, using Bullard’s math one of the meetings (March, May, or June) would need to see a .50 basis point increase and the financial markets have been more in line with pricing for a .25 increase. As a result, mortgage rates climbed to the highest levels in over two years.
So as we move into a new business week there are 2 items that we will are keeping our eye on;
Even though the CPI report is in the rear-view mirror and we rum our anent ion to tomorrow’s Producer Price Index. The Producer Price Index is a measure of wholesale inflation and much of this gets passed on to the consumer.
Russia/Ukraine border situation- there has been a lot of news regarding a Russian invasion, but it has not materialized yet. Headline news/geopolitical news in recent months has not had an impact on the bond market but in this instance, the Russia/Ukraine border issue is moving markets.
Looking at the week ahead, investors will focus on tomorrow’s Producer Price Index which measures wholesale inflation. The Federal Reserve notes are due out this Wednesday and are likely to get attention as they may speak to the view of future Fed activity. Retail Sales and Existing Home Sales information are also coming out this week.
Sources: Bloomberg, CNBC, XIN IX, Inc., Business Insider, Mortgage Bankers Association, Mortgage Daily News, Investing.com
2022 Single Family Mortgage Loan Limit
- Conventional Loan Limit $647,200
- FHA – Collier County – $552,000 or FHA – Lee County is $420,680
- (Duplex, Triplex and Quad Loan Limits are Higher)
FREDDIE MAC’s WEEKLY PRIMARY MORTGAGE MARKET SURVEY® From January 27, 2022
- 30 Year Fixed= 3.69% + .8 discount point/ IS Year Fixed= 2.93% + .8 discount point
- The 30 Year fixed mortgage rate is approx. 1 year ago – February 4th, 2021 was 2.73 +.7 discount. A discount point of .7 means an additional charge to the buyer of $2870.00 based on the average mortgage loan of $410,000 (MBA). A discount point of .7 means an additional charge to the buyer of$2870.00 based on the average mortgage loan of$410,000 (MBA)
LEADING INDICATORS TODAY
- 10 Year Treasury-Opened Today 1.9630 the 52 week low is 1.1280 and the 52 week high is 2.0630
- WTI Crude Oil (CLl}-Opened Today $93.93 the 52 week low is $57.25 and the 52 weeks high is $95.82
Closed Sales
Closed sales for the 12-month period ending December 31 were up 23% from the preceding 12-months, from 31,834 to 39,179. Sales for the month of December, although down 20% from the unprecedented surge we experienced in 2020, were up 34% when compared to pre-pandemic levels of the three preceding years.
Listing Inventory / New Listings
With 2,108 properties on the market as of December 31, listing inventory remains low. This is less due to a lack of listings entering the market than it is to the rate at which listings are selling. New listings for the 12-month period ending December 31 were down 4% from the preceding 12 months, from 37,855 to 36,282.
Average Selling Price
The average selling price for the 12-months through December 31 was $641,354, up 24% from the preceding 12-month period when the average selling price was $518,791.
Summary
Despite historically low standing inventory throughout the year, with nearly 40,000 properties sold, 2021 broke all past annual closed sales records. New listings, although down somewhat from 2020, still came in at a steady pace but most were spoken for by buyers right away, sometimes even prior to the listings making it to the Multiple Listing System and thereby never being counted in the standing inventory. 2021 also realized a notable increase in the average sales price with a 24% gain over the preceding year. By comparison, 2020 posted a 17% increase. Notably, prior to these considerable increases, the average price only rose an average of 2% per year from 2016 through 2019. The average sales price in Southwest Florida has risen an average of 11% per year over the past five years.
For 2021, John R. Wood Properties surpassed all other brokerages in total closed transactions, total closed sales volume, and total listings sold in Southwest Florida!