photo: London Bay Homes
By June Fletcher
Forget recent stock market volatility: Real estate experts say the outlook for Southwest Florida’s economic future is sunny.
Strong job and population growth will spur a healthy economy and robust real estate development in every sector, the experts told a group of about 150 business people at a Real Estate Investment Society workshop Friday at the Cohen Center at Florida Gulf Coast University.
“It’s time to gear up,” said Jerry Parrish, chief economist and director of research at the Florida Chamber Foundation, adding Florida will need to add two million new jobs by the year 2030, partly to serve a population older than 65 that is projected to grow by an equal amount.
In Southwest Florida, jobs growth is already running ahead of the state. Parrish noted the Naples metro area saw 22 percent job growth over the year in July and Cape Coral-Fort Myers 20.8 percent. Both grew faster than the state as a whole, which rose 16.6 percent.
But since retirees are also leaving the workforce at a quick clip, the region needs to focus on bringing young, new talent to the workforce to keep businesses humming. “We need every able bodied person working,” he said.
Sustained job growth is also vital to the state’s economic health because nearly three-quarters of Florida’s general revenues come from sales and use taxes. “The more people at work, the more property and sales taxes are paid,” he said.
Robert Beatty, dean of the Lutgert College of Business at Florida Gulf Coast University, said that there are more jobs open in both Lee and Collier counties than there were before the housing crash.
But since the region’s population is growing, too, he found the increase sustainable and a reason to be optimistic.
“We’re seeing people who want to come and stay here,” Beatty said.
For those involved in construction, the recent uptick in job and population has spurred a business bonanza.
Michael Greenberg, Southwest Florida regional president of Neal Communities, said his company has already sold out two of the seven communities it has built in Collier and Lee counties.
The downside is, he’s also scrambling to find enough skilled construction workers to build new homes — a problem other homebuilders in the region are facing, too.
“We need for the labor force to grow — biggest issue we face is we’re all competing for the same labor,” he said.
Those who build commercial properties are reaping profits, too.
“It’s fun to be in real estate again,” said Brian Goguen, chief operating officer at Barron Collier Companies, mentioning the firm’s recent sales of the Mercato for $239 million and La Playa Beach and Golf Resort for $188 million, or about $1 million a room.
“Everyone is bullish on real estate, a lot of money has flooded into the market,” he said, adding “large institutional investors are chasing deals.” And after a long period of caution, “banks are lending again,” he said.
Mark Stevens, president of Stevens Construction Company, said “we’re starting to do some commercial work that just wasn’t out there a few years ago.” The company’s Fort Myers office is currently building the Southwest Florida Performing Arts Center in Bonita Springs, as well as a bank, a deli and some medical offices.
Adam Palmer, principal of Land Qwest in Fort Myers, pointed out that commercial building owners also have an opportunity to profit by raising rents on tenants whose leases were written during the downturn, when rents were less expensive.
But investors in commercial properties shouldn’t expect rampant appreciation to fuel profits in the future, as they have for the past few years, said Randy Anderson, chief economist for Griffin Capital Corp. based in El Segundo, California.
Speaking to the group via Skype, Anderson said “we’re not in the first innings” of the real estate recovery, and therefore investors should stick with the fundamentals when assessing a deal.
“Buy assets in good markets where you can where raise rents and where management matters,” he said.
Looking at various sectors, Anderson was most bullish about the industrial market, largely due to the need for more warehouse space as online retailers like Amazon grab more market share. For the same reason, he was less enthusiastic about the retail sector. “Stores in strip malls in the middle of nowhere have a hard time paying the rent,” he said.
Telecommuting and the trend toward cube farms and flex space, rather than big private offices, has muted the need for more office space, he said.
But multifamily still has room to run, he said, as young people create new households and older ones downsize.
“Real estate is not cheap anymore and it’s not a simple game,” he said. “But there are still a lot of good deals and opportunities available over the next three to four years.”
photo: del webb
NABOR Report | Collier
Increase almost double July’s growth | By June Fletcher | Naples Daily News
Home price growth in Collier County revved up at a double-digit rate in August, traditionally a slow month, a new report released Friday said.
The Naples Area Board of Realtors said overall median home prices jumped 15 percent in August, to $306,000 from the same month a year earlier.
The monthly report covers existing Collier home listings and sales, excluding Marco Island.
The increase was nearly twice the year-over-year price bump up of July, when prices rose 8 percent to $287,000 from $265,000.
Prices jumped the most in South and East Naples, where they are lowest, but also were strong along the expensive beachfront area where multimillion homes are common.
Single-family homes saw prices swell 22 percent, to a median of $388,000 from $317,000, while condos rose more modestly, to $235,000 from $230,000, a 7 percent increase.
Mike Hughes, president of NABOR, said the price growth was due to a number of factors, including worries about stock market volatility, an improved job market and fears that mortgage interest rates will soon rise.
Competition for the ever-shrinking supply of homes costing less than $300,000 — supply was down 26 percent year over year, to 946 from 1,279 — also pushed up prices, he said. “Hopefully, builders in this price range will help us out,” he said.
Because there were fewer homes available in the lowest price point — a situation that has lasted for several months — sales slowed 21 percent, to 338 from 430 The drop contributed to a slowing of sales overall, down 8 percent, to 689 from 747.
But closed sales rose dramatically in all the highest price points: in the $1 million to $2 million range, they were up 48 percent, to 49 from 33, and in the $2 million and up price range, they jumped to 24 from 19, a 26 percent rise.
Pending sales followed a similar pattern, dropping in the under $300,000 range and rising in all other price points. Overall, they were up 2 percent, to 811 from 795. Reflecting the tightening supply, days on the market decreased 4 percent, to 78 from 81. There’s now a little over 4 months’ supply of housing.
A service from the Naples Area Board of REALTORS®
REALTORS® Busy from Beaches to Beyond
Naples, Fla. (August 21, 2015) – Activity in the Naples area housing market continued its upward momentum moving into summer as evidenced in the July 2015 Market Report released by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island). An 8 percent increase in overall pending sales (homes under contract) from 845 in July 2014 to 913 in July 2015 is one indication REALTORS® stayed busy in July. Unlike July 2014 where both overall pending sales and overall inventory decreased 13 percent respectively, activity in July 2015 had many notable peaks and very few valleys. For example, overall inventory decreased 1 percent from 3,563 in July 2014 to 3,518 in July 2015, but inventory for single-family homes rebounded with a 7 percent increase from 1,906 single family homes in July 2014 to 2,040 single family homes in July 2015.
Inventory continued to dissipate at double-digit rates in the low end of the market (overall inventory for homes in the $300,000 and below price category decreased 26 percent from 1,281 homes in July 2014 to 945 homes in July 2015); yet inventory in most other price categories during July was replenished. This is most apparent in the single-family homes market where the $300,000 and below price category fell 31 percent, but other categories saw big gains.
The NABOR® July 2015 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® July 2015 sales statistics are presented in chart format, including these overall (single-family and condominium) findings:
- Overall pending sales increased 8 percent from 845 homes in July 2014 to 913 homes in July 2015.
- Overall closed sales increased 1 percent from 9,751 homes in the 12-months ending July 2014 to 9,879 homes in the 12-months ending July 2015.
- Overall closed sales for condominiums in the $300,000 – $500,000 price category increased 38 percent from 686 condominiums in the 12-months ending July 2014 to 947 condominiums in the 12-months ending July 2015.
- Overall median closed price increased 14 percent from $259,000 in the 12-months ending July 2014 to $295,000 in the 12-months ending July 2015.
- Overall median closed price for homes over $300,000 decreased 5 percent from $550,000 in the 12-months ending July 2014 to $520,000 in the 12-months ending July 2015.
- Overall median closed price for homes in the $2 million and above price category increased 16 percent from $2,850,000 in the 12-months ending July 2014 to $3,300,000 in the 12-months ending July 2015.
- Overall inventory decreased 1 percent from 3,563 homes in July 2014 to 3,518 homes in July 2015.
Condominium inventory decreased 11 percent from 1,657 condominiums in July 2014 to 1,478 condominiums in July 2015.
- There is a 4.35 months supply of inventory.
- Conventional sales comprised 40 percent of all transactions in July 2015.
- Average days on market did not change between July 2014 and July 2015 to remain at 77 days.
New home construction in Livingston Lakes, Naples, Florida
photo: WCI Communities
By June Fletcher
Single-family homes in Southwest Florida topped the state in price growth in July, but town houses and condos showed more lackluster increases, a new report shows.
Median single-family home prices in the Naples-Marco Island area rose 23.1 percent in July over the year, to $400,000 from $325,000, according to a monthly report by Florida Realtors.
That put it first among 20 residential areas the Orlando-based trade group tracks.
Cape Coral-Fort Myers was second in the state. Single-family home prices were up 17.2 percent, to $210,900 from $179,900.
Both areas handily beat statewide single-family price growth of 8.1 percent, to $199,900 from $185,000.
They also want to snag a vacation home in the offseason and “prove the myth that you can visit Naples in hot, steamy weather and save money,” he said.
But price growth has abated in Southwest Florida’s multifamily homes, which had big year-over year increases in June.
Town houses and condo median prices rose only 4.3 percent in Naples-Marco Island, to $245,000 from $235,000, and 6 percent, to $169,500 from $159,950 in Cape Coral-Fort Myers.
That put both metro areas low on the list for multifamily price growth in Florida: Naples-Marco Island ranked 14th, and Cape Coral- Fort Myers ranked 11th.
Statewide, multifamily median prices hit $150,000, up 9.1 percent from $137,500 a year earlier.
John Tuccillo, chief economist for the trade group, said in the
But price growth has abated in Southwest Florida’s multifamily homes, according to a monthly report by Florida Realtors.
A service from the Naples Area Board of REALTORS®
2Q Report Indicates Housing Market is On Pace to Be a Great Year
Naples, Fla. (July 17, 2015) – According to the Second Quarter 2015 Market Report released by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island), 60 percent of the market experienced inventory growth, and overall sales activity remained on pace with activity experienced in the second quarter of 2014. The report also indicated a 9 percent increase in pending sales (quarter over quarter) for homes priced above $300,000. These factors and other statistics in the 2Q 2015 Market Report have led broker analysts to conclude another great year is very likely.
Brown pointed out that from 2010 to 2012 80 percent of all pending sales were composed of homes under $300,000. But second quarter reports for 2014 and 2015 identify a shift took place in pending sales activity to homes at higher price points within the market. And while inventory in the under $300,000 price category decreased 24 percent in the 2Q of 2015 (the same rate as in the 1Q of 2015); this price segment no longer makes up the majority of the market’s inventory.
Broker analysts contend that the market was quite different 10 years ago with a lot of flipping and loose financing going on. But the consumer and industry setting is different today. The 2Q 2015 Market Report revealed where the differences occurred like median closed price, where prices for homes between $300,000 and $2 million leveled out increasing or decreasing 0 to 2 percent. Other differences revealed in the 2Q Report are a gradual increase in financed homes to 38.3 percent of the market in June 2015, and a non-traditional market (short sales and foreclosures) that is dwindling at just 7 percent of the market.
According to the 2Q 2015 Market Report, the Naples area experienced a 14 percent increase in overall median closed price from $255,000 in the 12-months ending 2Q of 2014 to $290,000 in the 12-months ending 2Q of 2015. Yet this increase was driven by increases at both ends of the market spectrum during this time period; i.e., an 11 percent increase in homes under $300,000, and a 15 percent increase in homes $2M and above. Incidentally, the median closed price for homes in price categories over $300,000 and under $2M decreased 1 percent.
Pockets of market highs and lows will continue to appear in the area, as demand and location continue to be major market influencers. For example, the report showed an 83 percent increase in inventory for condominiums in the $2M and above price category from 29 units in the 2Q of 2014 to 53 units in the 2Q of 2015, and a 23 percent decrease in condominium inventory in the Naples Beach area from 476 units in the 2Q of 2014 to 368 units in the 2Q of 2015.
Inventory for single-family homes continued to rise in the 2Q of 2015 with a 9 percent increase from 1,964 single-family homes in the 2Q of 2014 to 2,133 single-family homes in the 2Q of 2015. Whereas the condominium market saw an 11 percent decrease in inventory for 2Q 2015 from 1,759 condominiums in the 2Q 2014 to 1,565 condominiums in the 2Q of 2015.
The NABOR® 2Q 2015 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® 2Q 2015 sales statistics are presented in chart format, including these overall (single-family and condominium) findings:
- Overall pending sales decreased 4 percent from 2,949 in the 2Q of 2014 to 2,843 in the 2Q of 2015.
- Overall closed sales remained flat with no increase or decrease reported in the 2Q of 2015.
- Closed sales for condominiums in the $300,000 to $500,000 price category increased 38 percent from 682 in the 2Q of 2014 to 938 in the 2Q of 2015.
- Overall median closed price increased 14 percent from $255,000 in the 12-months ending 2Q of 2014 to $290,000 in the 12-months ending 2Q of 2015.
- Overall inventory decreased 1 percent from 3,723 homes in the 2Q of 2014 to 3,698 homes in the 2Q of 2015.
- Overall inventory for homes in the under $300,000 price category decreased 24 percent from 1,366 homes in the 2Q of 2014 to 1,036 homes in the 2Q of 2015.
- Inventory for single-family homes in the $500,000 to $1M price category increased 32 percent from 456 single-family homes in the 2Q of 2014 to 604 single-family homes in the 2Q of 2015.
- Average days on market decreased 20 percent from 94 days in the 2Q of 2014 to 75 days in the 2Q of 2015.
The NABOR® June 2015 Market Report was also released and reflected these overall (single-family and condominium) findings:
- Overall pending sales increased 5 percent from 840 homes in June 2014 to 882 homes in June 2015.
- Overall closed sales remained flat with no increase or decrease reported in the 12-months ending June 2015.
- Overall median closed price increased 14 percent from $255,000 in the 12-months ending June 2014 to $290,000 in the 12-months ending June 2015.
- Overall inventory decreased 1 percent from 3,723 homes in June 2014 to 3,698 homes in June 2015.
- Average Days on market decreased 22 percent from 94 days in June 2014 to 73 days in June 2015.
To ensure your next sale or purchase in the Naples area is a success, contact a REALTOR® on Naplesrea.com.
The Naples Area Board of REALTORS® (NABOR®) is an established organization (Chartered in 1949) whose members have a positive and progressive impact on the Naples Community. NABOR® is a local board of REALTORS® and real estate professionals with a legacy of nearly 60 years serving 5,000 plus members. NABOR® is a member of the Florida Realtors and the National Association of REALTORS®, which is the largest association in the United States with more than 1.3 million members and over 1,400 local board of REALTORS® nationwide. NABOR® is structured to provide programs and services to its membership through various committees and the NABOR® Board of Directors, all of whose members are non-paid volunteers.
The term REALTOR® is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribe to its strict Code of Ethics.
View June 2015 Market Statistics | View 2Q 2015 Market Statistics
To view the entire report, visit www.NaplesArea.com
Sizzling market is about to get hotter
By June Fletcher Naples Daily News
The housing market in Southwest Florida has been red-hot for the past three years. Now it’s about to get blistering.
That’s the conclusion of a new second quarter survey by Local Market Monitor that predicts the Naples-Marco Island area will have the highest cumulative gain in one-to four family home prices — 41 percent — over the next three years of any of the 20 Florida metropolitan statistical areas it tracks.
And it’s up considerably from the 29 percent three-year projection the 25-year-old Cary, N.C.-based real estate research firm made in the second quarter of 2014.
“That’s a big increase,” said Ingo Winzer, president and founder of the firm, which tracks 315 markets nationwide. “You’re looking at a real phenomenon.”
He forecast the giant gain after looking at recent data pointing to a growth in jobs, a shortage of both new and resale homes, and the relatively small number of foreclosed homes on the market.
“There’s been a surge in demand of people who aren’t just visiting but want to live full-time in Naples,” he said. “I think it will continue.”
