Rising Inventory and Competitive Pricing are Favorable for Home Sales
Naples, Fla. (March 29, 2024) – The overall median closed price in Naples increased 5 percent to $625,000 in February from $595,188 in February 2023, but there were also 2,264 price decreases reported. Brokers contend that price decreases may be one indication that sellers are shifting from aspirational pricing to realistic market pricing. According to the February 2024 Market Report by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island), closed sales decreased 9.3 percent in February despite a 66.6 percent increase in inventory to 5,139 properties from 3,085 properties in February 2023.
Rising Inventory Brings Patience
February’s price decreases demonstrate that REALTORS® are counseling sellers about realistic market pricing. Although some sellers are still struggling to accept the fact that the pandemic buying frenzy years with climbing price increases are over. As more new sellers enter the market (up 24.6 percent to 1,668 new listings from 1,336 new listings in February 2023), those sellers with overpriced properties risk missing an opportunity to attract and sell to eager buyers.
According to the report, in February 2019 the median closed price was $335,000. Cindy Carroll of Carroll & Carroll Appraisers & Consultants, LLC., and broker analysts like Budge Huskey, CEO, Premier Sotheby’s International Realty, agree that “in the face of far more inventory and opportunity, home values are holding steady in Naples today. People are being highly selective and will wait until they find the right property.”
Insurance vs. Interest Rates
The February Market Report showed a 103.4 percent increase in inventory for properties under $300,000. Mike Hughes, Vice President and General Manager for Downing-Frye Realty, Inc., said that this might be because “investors are offloading rental property units to capitalize on the winter selling season. Also, the carrying costs on some of these properties has climbed in recent years. This increase in inventory, for buyers looking in this price range, is encouraging as their selection was quite limited a year ago.”
As many Naples residents are discovering, when home values increase, the replacement cost to insure them also increases. Insurance rates and association fees could increase for condominium owners by the end of 2024 as mandatory milestone inspections must be completed by year end. Inventory for condominiums increased 104.2 percent in February to 2,614 condominiums from 1,280 condominiums in February 2023.
The NABOR® February 2024 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. NABOR® sales statistics are presented in chart format, including these overall (single-family and condominium) findings for 2024:
Market Report Standouts
Upon observation, the February Market Report shows median closed price decreased for condominiums located in the Naples Beach (34102, 34103, 34108); Central Naples (34104, 34105, 34116); and Immokalee/Ave Maria areas. And the area with most closed sales of single family homes in February was East Naples (34114, 34117, 34120 and 34137), which also reported the highest inventory of available properties (1,125).
While February’s report showed an average of 69 days on market, it is nowhere near the 101 DOM reported in February 2019. Interestingly, average days on market during February was highest in the $5 million and over condominium market (99 DOM). According to Carroll, months of inventory for neighborhoods west of US 41 tend to be higher as these communities are oversaturated with spec homes and aspirational sellers. “Inventory of homes in Aqualane Shores is 3.5 years; and in Port Royal is 2.9 years.”
If you are considering buying or selling your home, contact David at [email protected] or 239-285-1086. As a Naples REALTOR® he will give you expert advice on how to make the best of today’s market conditions.