RISMEDIA, Saturday, May 28, 2016— Pending home sales rose for the third consecutive month in April and reached their highest level in over a decade, according to the National Association of REALTORS®. All major regions saw gains in contract activity last month except for the Midwest, which saw a meager decline.
The Pending Home Sales Index, a forward-looking indicator based on contract signings, hiked up 5.1 percent to 116.3 in April from an upwardly revised 110.7 in March and is now 4.6 percent above April 2015 (111.2). After last month’s gain, the index has now increased year-over-year for 20 consecutive months.
Lawrence Yun, NAR chief economist, says vast gains in the South and West propelled pending sales in April to their highest level since February 2006 (117.4). “The ability to sign a contract on a home is slightly exceeding expectations this spring even with the affordability stresses and inventory squeezes affecting buyers in a number of markets,” he says. “The building momentum from the over 14 million jobs created since 2010 and the prospect of facing higher rents and mortgage rates down the road appear to be bringing more interested buyers into the market.”
On the topic of mortgage rates, which have remained below 4 percent in 16 of the past 17 months, Yun says it remains to be seen how long they will stay this low. Along with rent growth, rising gas prices – and the fading effects of last year’s cheap oil on consumer prices – could edge up inflation and push rates higher. For now, he foresees mortgage rates continuing to hover around 4 percent in the coming months, but inflation could potentially surprise the market and cause rates to increase suddenly.
Adds Yun, “Even if rates rise soon, sales have legs for further expansion this summer if housing supply increases enough to give buyers an adequate number of affordable choices during their search.”
Following the housing market’s best first quarter of existing-sales since 2007 (5.66 million) and a decent increase (1.7 percent) in April, Yun expects sales this year to climb above earlier estimates and be around 5.41 million, a 3.0 percent boost from 2015. After accelerating to 6.8 percent a year ago, national median existing-home price growth is forecast to slightly moderate to between 4 and 5 percent.
The PHSI in the Northeast climbed 1.2 percent to 98.2 in April, and is now 10.1 percent above a year ago. In the Midwest the index declined slightly (0.6 percent) to 112.9 in April, but is still 2.0 percent above April 2015.
Pending home sales in the South jumped 6.8 percent to an index of 133.9 in April and are 5.1 percent higher than last April. The index in the West soared 11.4 percent in April to 106.2, and is now 2.8 percent above a year ago.
“This report rounds out a triple crown of April home sales reports with existing home closings, new pending contracts, and new home sales all solidly up as the spring buying season ramped up,” says realtor.com chief economist Jonathan Smoke. “Across these metrics, the pace of total home sales is up more than 10 percent over last year, putting 2016 in the pole position to earn the standing of the best year in a decade.”
For more information, visit www.realtor.org.
Naples Real Estate: April Report Shows Real Estate Market in a Sweet Spot with More Choices & Steady Prices
Naples, Fla. (May 20, 2016) – As predicted by broker analysts in January, declines in home sales activity that appeared in the first quarter of 2016 were not a trend. This was further evidenced in the April 2016 Market Report released by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island). In fact, the April report showed several signs that the Collier County residential resale market is a healthy, self-correcting machine that’s on a steady course to becoming even more balanced.
Rick Fioretti, NABOR® President and Broker Associate with Berkshire Hathaway Home said, “Closed sales have eased from April 2015 to April 2016 due to a leveling off of the market.”
Overall inventory increased 36 percent in April 2016 to 5,480 homes from 4,040 homes in April 2015. Most surprising was a 171 percent increase in inventory for condominiums in the $2 million and above price category, which resulted in 92 condominiums for sale in April 2016 from 34 condominiums in April 2015. Condominium inventory in the Naples Beach area also increased 73 percent to 683 condominiums in April 2016 from 394 condominiums in April 2015.
The NABOR® April 2016 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® April 2016 sales statistics are presented in chart format, including these overall (single-family and condominium) findings:
- Overall pending sales decreased 10 percent to 1,084 in April 2016 from 1,210 in April 2015.
- Overall pending sales for homes in the $1 million to $2 million price category increased 4 percent to 93 homes in April 2016 from 89 homes in April 2015.
- Overall closed sales decreased 7 percent to 9,117 homes in the 12-months ending April 2016 from 9,856 homes in the 12-months ending April 2015.
- Closed sales of single-family homes in the $300,000 to $500,000 price category increased 26 percent to 881 single-family homes from 698 single-family homes in April 2015.
- Overall median closed price increased 11 percent to $314,000 in the 12-months ending April 2016 from $283,000 in the 12-months ending April 2015.
- Median closed price for single-family homes in the $300,000 and below price segment increased 25 percent to $227,000 in April 2016 from $182,000 in April 2015.
- Overall inventory increased 36 percent to 5,480 homes in April 2016 from 4,040 homes in April 2015.
- Inventory for condominiums in the $300,000 and below price category increased 33 percent to 1,181 condominiums in 1Q 2016 from 887 condominiums in the 1Q 2015.
- Inventory for condominiums in the Naples Beach area increased 73 percent to 683 condominiums in April 2016 from 394 condominiums in April 2015.
- Average days on market decreased 9 percent to 72 days in April 2016 from 79 days in April 2015.
Beside the Immokalee/Ave Maria area, inventories are the highest in the Naples Beach area, which saw a 47 percent increase in inventory to 1,276 properties in April 2016 from 868 properties in April 2015. The number of condominiums in this geographic area swelled impressively by 73 percent in April making it a buyer’s paradise once again.
By Laura Layden of the Naples Daily News
The busy season may be over in Southwest Florida, but the region’s businesses are still busy hiring.
Employers in Collier, Lee and Charlotte counties added 15,900 jobs over the year in April, according to a monthly report released Friday by the Florida Department of Economic Opportunity.
The Naples area added 3,000 jobs year over year. Its jobless rate fell to 4.1 percent in April, down from 4.6 percent a year ago.
In a news release, Gov. Rick Scott called it “great news.”
“We are working every day to support economic growth so our state can outcompete all other locations for new jobs and opportunities,” he said.
Read more on naplesnews.com
Cuban sandwich | photo courtesy of Fernandez the Bull restaurant, Naples, Florida
By Laura Layden
Naples is on yet another top 10 list.
It landed at No. 9 on the list of Best Small Town Food Scenes in the U.S., based on votes by readers of USA TODAY’S 10 Best travel section.
USA TODAY editors chose Naples as one of their 20 best places to enjoy a happening food scene in a small town, then readers voted for their top 10 from the nominees.
“It’s great to be in the top 10 because that means we get a lot of publicity,” said JoNell Modys, public relations and communications manager at the Naples, Marco Island, Everglades Convention & Visitors Bureau.
Frankenmuth, Michigan, took the No. 1 spot, with Fredericksburg, Texas, coming in 10th place for its food scene.
The 10 Best Readers’ Choice Award contest launches new categories every other Monday at noon, revealing each category’s 20 nominees. After four weeks of voting, the contest closes. On the Friday after voting ends, winners are announced.
In other recent voting by readers of USA TODAY’s 10 Best, Naples ranked No. 1 as the Best Destination for Luxury Travelers, and it came in second as one of the best Alfresco Dining Neighborhoods in the U.S.
“We’re really on a roll with lots of editorial and readers’ choice accolades for having a great food scene here in Naples, and in Marco Island as well. It really does reflect what has been going on here since there has been a great evolution of dining opportunity over the past five to 10 years,” Modys said. “There has always been a lot of locally owned restaurants. Now there is even more of them, and what they are offering is really resonating with what travelers like.”
In visitor research surveys in January and February, dining rose to the No. 1 favorite activity in the Naples area, surpassing the beach.
Locally sourced, fresh ingredients are commonly used at area restaurants, following a global trend, and Naples has some attributes that help it stand out including creative chefs and delicious seafood from the Gulf of Mexico, Modys said.
“We have more restaurants that are staying open later and just have more of an eclectic, fun vibe,” she said.
Naples has also been named one of the top 20 American cities for food as part of Condé Nast Traveler’s Readers Choice Awards for the last three years.
“The consistency of these recognitions is very significant. And people notice that,” Modys said.
The awards could help attract younger visitors.
“Research is showing that millennial travelers like to travel for specific food experiences, or they seek out what is the best in an area, often based on online reviews,” Modys said.
With announcements and stories about the top awards continuing to live online, they’ll pop up in Internet searches by travelers, which could influence their decisions for years to come.
Naples could soon make it on another top 10 food-related list. Voting is open through May 9 for the Best Cuban Sandwich in Florida. The duo of Cuban sandwiches sold at Naples’ Fernandez the Bull restaurant is at No. 2, ahead of well-known eateries such as the venerable Columbia Restaurant in Tampa and El Mason de Pepe in Key West.
Fans of Fernandez the Bull can cast their vote at http://www.10best.com/awards/travel/best-cuban-sandwich-in-florida/fernandez-the-bull-naples/share/
Highlights from the NABOR® Economic Summit Event
Naples, Fla. (May 2, 2016) – More than 400 REALTORS® and real estate professionals interested in the economic health of Collier County attended the Naples Area Board of REALTORS® (NABOR®) 2016 Economic Summit, “The New Future: A View from the Top,” on Thursday, April 21, 2016 at the Hilton Naples. Three guest speakers provided national, state, and local analysis of recent growth and home sales activity as well as predictions of what to expect in the next 12 months.
Cindy Carroll, SRA, with the real estate appraisal and consultancy firm Carroll & Carroll, Inc., set the tone of the conference when she asserted, “I’m a truth teller!” The audience’s familiarity with Carroll’s wit brought laughs, but the comment wasn’t in vain as her reputation in deciphering predictive patterns in market behavior commands serious respect. Carroll’s presentation reflected the First Quarter 2016 Market Report released by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island).
“My headline for March would be ‘Inventory is up 35 percent over the last 12 months,'” said Carroll, who added that it fell 22 percent between March 2013 and March 2014, but only fell 1 percent between March 2014 and March 2015. “Anytime there is less than 6 months worth of inventory, prices go up. But we’re currently at 7.3 months of inventory and the report shows very little movement in price. When we get to 9 months, price increases will most likely really slow down. When we achieve a years worth of inventory – what I consider a balanced market for our area – then we’ll start to see pricing mature anywhere between 4 to 8 percent.” Carroll added that if the Naples area ever achieves 2 years worth of inventory (something it experienced in 2006) again, then we may begin to see signs of value erosion.
Where is all this inventory? “Not in the $0 to $300,000 single-family home market,” said Carroll. “This segment’s inventory is down 10 percent and its median closed price is up 15 percent. Inventory in all other price categories within the single-family home market increased from 18 to 42 percent.”
According to Carroll, in December 2010 the median closed price for the single-family home market broke $300,000. The under $300,000 market consumed 44 percent of the market then. Now, it makes up only 12 percent of the market. Interestingly, the median closed price in the condominium market broke $300,000 in December 2013. But today the median closed price in the condominium market is $252,000. For perspective, condominiums in the $0 to $300,000 price category represented 59 percent of the condo market in December 2010. Now, they are only 48 percent of what’s available.
Carroll said there appears to also be an exodus to the Ave Maria area as the single-family home median closed price rose 105 percent in that area. “Buyers seeking affordable housing are going East!”
Most neighborhoods west of U.S. 41 exceeded or are nearing a stable market level of one year of inventory. Meanwhile, a severe shortage of supply persists in the entry-level markets of Golden Gate City and Naples Manor.
When Mike Timmerman, President and CEO of MJT Realty Economic Advisors, took the stage, he said the speculative home market in neighborhoods nearest U.S. 41 had peaked about a year and a half ago. “There is a 60-month supply of new product in Pine Ridge,” he said. “And the Park Shore and Moorings neighborhoods are in a major redevelopment phase too.”
One big change Timmerman likes is the new architectural designs being chosen. “Instead of the Mediterranean style home, we are now seeing homes in Neo-classical styles.”
Between 2014 and 2015, developers added 3,500 new units around Collier. “There’s now an excess supply and we are starting to see communities offer incentives again,” said Timmerman. “But it’s unclear what effects this election year will have on out-of-state buyers next season.”
Timmerman concluded with a few predictions:
- The current pace of redevelopment will create more price reductions,
- High rise development will see a resurgence,
- REALTORS® will see more incentives from community developers, and
- Communities will introduce more multi-family product.
Despite commenting that spending in the upper-end of the market is sensitive to an election cycle, Dr. Lawrence Yun, PhD, Chief Economist National Association of Realtors® (NAR®) said, “The wealthy are looking for great options and this area has them.”
“Lifetime wealth is at an all time high,” said Yun, who added that middle America’s income is falling.
“Corporations are sitting on cash and this lack of infusion into the market is why growth is sluggish.”
Yun went on to add that, “Homeownership is near a 50-year low, but home sales are rising nationally. “Young people are struggling to get in the market, but the new tight lending standards are hammering Millennials and, saddled with too much college student loan debt, they can’t qualify for home loans.”
Vacation home sales surged in 2014 according to Yun, and he sees pending sales holding steady nationally for now. “Mortgage rates will go up moderately,” said Yun, adding that the Federal Reserve may increase interest rates twice this year and up to four times in 2017.
In closing, Yun said builders in Florida are not adding product fast enough and this will create a pinch in an already tight rental market, where rates will continue to rise.
