Blog – The Wakelin Team

The Naples Area Board of Realtors May 2022 Market Report

Inventory Heating Up is Good News for Summer Buyers

Naples, FL (June 24, 2022) – During a meeting to review the May 2022 Market Report by the Naples Area Board of REALTORS^® (NABOR^®), which tracks home listings and sales within Collier County (excluding Marco Island), long-time Naples broker Bill Coffey, Broker Manager of Amerivest Realty Naples, remarked that, “May had the highest number of new listings than any May in the last three years.” Fellow brokers who also analyzed the May report are pleased with this trend as it will lead to more options for summer buyers. New listings during May pushed the inventory of homes for sale up 58.6 percent to 2,046 properties compared to 1,290 properties in May 2021.

“Inventory has been rising since December,” said Jeff Jones, Broker at Keller Williams Naples. “By the end of May, our inventory in Naples has nearly doubled since the same time a year ago. And if you include the 889 homes that had a price reduction in May to this inventory mix, then we’re in good shape heading into summer. Price reductions are basically like new listings because the home’s new price point becomes a new opportunity to a larger pool of buyers.”

Though many of the brokers reviewing the report warn against comparing activity today to activity in the last two years. “If you look at the percentage of home sales since January compared to last year, it appears we are doing poorly [-32.5%],” said Budge Huskey, CEO, Premier Sotheby’s International Realty. “But 2021 was not a typical year for home sales in Naples. We had record level sales last year. However, we also can’t compare activity today to 2020 because during the first half of that year, the country was under pandemic restrictions which caused sales to suffer.”

As such, brokers prefer to compare this year’s activity to activity in 2019 as it was a balanced year with 7.3 months supply of inventory. “A healthy market for us is six to 12 months of inventory,” said Brenda Fioretti, Broker Associate at Berkshire Hathaway HomeServices Florida Realty.

Looking at closed sales, there was a 24.5 percent decrease in May to 1,249 closed sales from 1,654 closed sales in May 2021. However, using 2019’s balanced market activity as a comparison, closed sales increased 7 percent month/month and 18 percent year to date/year to date. Demand remains strong despite having three times fewer options in inventory compared to 2019 levels. Today, we have 1.9 months supply of inventory.

Not surprisingly, low supply and high demand are driving price increases in Naples and across the nation. “Macro factors are now impacting the pace of sales, but the fundamentals suggest values will be insulated,” added Huskey. “In fact, home prices have historically outpaced the rate of inflation.”

And while new construction is adding to the inventory, it’s not at a rate that will triple the inventory anytime soon.

The overall median closed price increased 40.3 percent in May to $608,000 from $433,500 in May 2021. Jones responded, “Median closed price increases today are somewhat misleading. If we look at closed sales by price range, the $300,000 and below market is down 56 percent. That’s because we have few homes in inventory within this price category anymore. Therefore, a huge drop in the number of sales in the lower price categories means the calculation used to determine today’s median closed price reflects sales in those price categories where there is more inventory.”

“Since January, we’ve seen a 21.9 percent increase in the number of homes sold in the $500,000 to $1 million price category,” added Coffey.

The NABOR^® May 2022 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 2022:

Wes Kunkle, President and Managing Broker at Kunkle International Realty, added that, “There’s a whole generation of new home buyers that have never seen rates this high before. But historically, rates have rarely gone below six percent. Aside from locking in at a rate before it increases, another advantage of buying a home today is that these buyers will be able to take advantage of the mortgage interest deduction on their income taxes.”

Closed sales were down slightly in the high end of the market in May, but this might be due to buyer reluctance to move cash out of the stock market right now. Notwithstanding, cash sales commanded 63.3 percent of closed sales in May, though brokers reviewing the report contend they are seeing more opportunities for buyers choosing to finance their purchase.

If you are looking to sell a home in Naples, contact The Wakelin Team as we have the ability and expertise to provide you with an accurate market comparison in this fast-moving market, manage your showings to the right audience, evaluate the use of contingencies, and help you negotiate your home sale during a multiple offer process. We can ensure your next purchase or sale in the Naples area is a success.

The Naples Area Board of Realtors April 2022 Market Report

Signs Show Naples Housing Market is Regaining Balance

Naples, FL (May 23, 2022) – Overall inventory in Naples during April increased 16.5 percent to 1,668 properties from 1,432 properties in April 2021. Fueled by a swell of new single-family home listings, up 5.7 percent over last year, broker analysts reviewing the April 2022 Market Report by the Naples Area Board of REALTORS^® (NABOR^®), which tracks home listings and sales within Collier County (excluding Marco Island), are confident the Naples area housing market has reached a crossroad and is making its turn toward a balanced and healthy market.

“It’s been thirty months since we’ve seen this many single-family home sellers enter our market in one month,” said Bill Coffey, Broker Manager of Amerivest Realty Naples. Coffey, along with several top brokers in Naples, say the shift indicates the Naples area housing market is redefining itself. Another major factor that signified the market was self-correcting to a new normal in April were the 549 price reductions (33 percent of the inventory) during the month.

“What we are seeing today are more sellers setting realistic list prices from the start and more buyers less willing to settle for homes that don’t meet their exact needs and desires,” said Brenda Fioretti, Broker Associate at Berkshire Hathaway HomeServices Florida Realty, who added that the report showed “we now have 1.5 months of inventory, the highest level since March 2021.”

Demand for the Naples lifestyle remains strong. Days on market for April was 16 days, considerably less than the historic 90-day average. As inventory begins to rise, days on market may increase and list prices in some neighborhoods may shift down slightly; but broker analysts agree that we should not expect home prices to drop to anywhere near pre-pandemic levels.

“There is virtually no data in the MLS for home sales below $300,000,” said Molly Lane, Senior Vice President at William Raveis Real Estate.

Coffey remarked that the $300,000 and below market was once the biggest category for closed sales in Naples. But rapid sales during the last 18 months severely depleted inventory in this price category. As such, there were only 96 properties below $300,000 in April’s inventory.

The overall median closed price in April increased 39.2 percent to $599,000 from $440,000 in April 2021. The uptick reflects the low number of sales in the $300 and below price category. Median closed prices continue to rise in the single-family home market, up 8.7 percent from March, but median closed prices during April in the condominium market decreased 1.1 percent from March.

The NABOR^® April 2022 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 2022:

Rising mortgage rates are likely reducing the number of buyers who can get pre-qualified for a home purchase in Naples, but it did not negatively impact buyer interest during April. In fact, there were over 200 more showing appointments during the month than reported in March, and 66.7 percent of all closed sales in April were cash sales.

Many brokers, including Mike Hughes, Vice President and General Manager for Downing-Frye Realty, Inc., recommend buyers place back-up offers because over 600 properties that went pending were put back onto the market in the last two months. “This is encouraging news for summer buyers as a back-up offer could win the day for them.”

If you are looking to sell a home in Naples, contact The Wakelin Team as we have ability and expertise to provide you with an accurate market comparison in this fast-moving market, manage your showings to the right audience, evaluate the use of contingencies, and help you negotiate your home sale during a multiple offer process. We can ensure your next purchase or sale in the Naples area is a success.

The Naples Area Board of Realtors March 2022 Market Report

Rising Inventory Encouraging

Naples, FL (April 22, 2022) – Demand for the Naples lifestyle remains strong as closed sales in March increased 49.9 percent compared to closed sales reported in February.Although closed sales decreased 36.5 percent to 1,205 in March 2022 from 1,899 in March 2021, the increase from February to March was a welcome result of a steady wave of new listings. According to the March 2022 Market Report released by the Naples Area Board of REALTORS^® (NABOR^®), which tracks home listings and sales within Collier County (excluding Marco Island), new listings decreased only 4.3 percent to 1,637 new listings from 1,711 new listings in March 2021. If this wave of new listings remains steady during the coming months, it could mean more options for buyers navigating the area’s limited inventory

“New listings are almost where they were a year ago,” said Mike Hughes, Vice President and General Manager for Downing-Frye Realty, Inc. “Overall, the report showed new listings have risen since the end of last year, over a three-month period.”

The March report showed inventory decreased 23.5 percent to 1,392 properties from 1,819 properties in March 2021. However, the good news is that March inventory increased 20 percent compared to inventory levels NABOR^® reported in February (1,176 homes). More homes for sale in March meant sellers enjoyed 43,206 showings that ultimately inspired 1,611 pending sales (homes under contract). The median closed price continued to increase in March, up 39.6 percent to $575,000 from $412,000 in March 2021, and 62.7 percent of the month’s closings were cash sales.

Upon reviewing the report, Molly Lane, Senior Vice President at William Raveis Real Estate, said, “As winter visitors go back up north, it’s likely we’ll start to see more new properties come onto the market as homeowners and landlords will want to cash out and take advantage of their ability to make a profit.”

The NABOR^® March 2022 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 2022:

“There were 51 percent more price decreases in March than February,” said Ryan Bleggi, President of NABOR^® and Managing Broker for John R. Wood Properties. “That means a good number of homes were not priced properly when they were originally listed.”

Mike Dodge, Director of Education and Market Research for John R. Wood Properties, pointed out “This could be good timing for potential sellers who have been reluctant to list due to concern about finding a replacement property. Listing now could reap the benefits of selling in an up market, but also the benefit of a market where recent increases in listing inventory should lessen the stress of finding a property to purchase.”

Adam Vellano, a Naples Sales Manager at Compass Florida, agreed and replied by stating, “The trend to list a home at $25,000 to $75,000 over comps is beginning to fade. Pricing should reflect, among other things, the location of the property and volume of homes for sale nearby.”

Hughes added, “In this rapidly fluid market, it’s very hard for homeowners to price a property without assistance from a REALTOR^® with knowledge of the Naples market. For example, the March report showed days on market for condominiums dropped to 13 days. When properties sell and close that quickly it provides a good collection of comps for REALTORS^® to access as they help a new seller set a good listing price. A qualified REALTOR^® can help a seller price the home competitively to begin with so they can avoid a need to reduce the price or wait a long time for their property to sell.”

The Naples Area Board of Relators February 2022 Market Report

Sellers are Taking Advantage of Home Values

Hitting Record Highs

Naples, FL (March 25, 2022) – More sellers are motivated to enter the market as home values continue to rise as a result of limited inventory and high demand in the Naples area. According to the February 2022 Market Report released by the Naples Area Board of REALTORS^® (NABOR^®), which tracks home listings and sales within Collier County (excluding Marco Island), the overall median closed price in February was $550,000, a 37.5 percent increase over the median closed price in February 2021. The high demand for homes is demonstrated by the number of showings in February, which was 43,032. When divided by the number of homes in inventory during February (1,176), this translates to 36 showings per home. For perspective, in 2019 there were 2.9 showings per home. The data also shows that homes sold fast in February, within 23 days on the market, and the percent of list price received was 100.6 percent, which pleased many sellers.

“Twenty-five percent of the homes that went under contract in February came back onto the market within 20 days on average during February,” said Jeff Jones, Broker at Keller Williams Naples.

To take advantage of this occurrence, Jones suggests buyers use a very important tool in real estate: the back-up offer contract. A back-up offer can be placed on any property when that property is already under contract with another buyer. But in today’s market, there is a higher likelihood that the first offer may not stick so a back-up offer is a smart tool for buyers right now.

Brenda Fioretti, Broker Associate at Berkshire Hathaway HomeServices Florida Realty, agreed with Jones and added, “Before the pandemic, we had a 3 to 5 percent back-on-market rate monthly. But things are different today. We are seeing some good success stories when back-up offers are used.”

Fioretti went on to explain that a back-up offer contract – if recommended by a REALTOR® and approved by the seller – may not require a deposit and the buyer can keep searching for a home to purchase until they either become the primary buyer on the first home or cancel the back-up offer. For the seller, back-up offer contracts can provide confidence. In such cases, if a buyer asks to renegotiate, the seller has leverage because they have a back-up offer. Additionally for sellers, back-up contracts allow them to avoid having to re-list the home and start showing it again.

While inventory during February decreased 47.1 percent to 1,176 homes from 2,224 homes in February 2021, brokers reviewing the report like Molly Lane, Senior Vice President at William Raveis Real Estate, say the real inventory number is actually higher because the report doesn’t capture the number of off-market listings. “Because new listings are a hot commodity these days, they often don’t make it to the MLS until after they are sold. Sales are happening so fast that transactions in the ‘shadow inventory’ (homes that are not yet for sale but will be coming to market in the future) are more common than ever before.”

The median closed price in February increased 37.5 percent to $550,000 from $400,000 in February 2021. But according to Dominic Pallini, Broker at Vanderbilt Realty, he believes that prices are beginning to stabilize. “The median closed price only increased .2 percent from January to February, and the report shows February had more price decreases [276] during the month than price increases [170].”

Closed sales in February during the years leading up to the pandemic (2017-2019) averaged in the low 600s, but demand for the Naples lifestyle and the amenities living in paradise offer have driven buyers to the paradise coast in record numbers in recent years. It is only due to a lack of inventory that home sales in Naples did not fare as well as last February. While overall closed sales decreased 39.5 percent to 804 in February from 1,330 in February 2021, Bill Coffey, Broker Manager of Amerivest Realty Naples, pointed out that the report showed “the only area where we are seeing a decrease in closed sales over the last year is in the $300,000 and below price category.”

Mike Hughes, Vice President and General Manager for Downing-Frye Realty, Inc., pointed out that it’s “slim pickins’” for first-time home buyers as the report showed “there were only 26 single family homes on the market during February that were in the $300,000 and below price category.”

The NABOR^® February 2022 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 2022:

There are several other key performance areas within the February report, month/month, that are worthy of mention:

1,261 – The number of new listings added to the existing inventory
69.7% – The percentage increase in median closed price for properties located in 34113
$1,161,203 – The average closed price for single family homes (+5.3%)
5% – The percentage increase in overall closed sales in Central Naples (34104, 34105, 34116)
4 – The number of months in a row that condominiums have sold for over 100% of list price
46% – The percentage decrease in median closed price for single-family homes in the Naples Beach area (34102, 34103, 34108)

“The process and complexity of real estate has changed,” said Budge Huskey, CEO, Premier Sotheby’s International Realty. “Having a REALTOR® on your side is the best way to ensure your interests are met and that you understand what to expect when you buy or sell a home in Naples.”

The Naples Area Board of Realtors January 2022 Market Report

Low Inventory & High Demand Continues to Push Home Prices Up in January

Naples, FL (February 25, 2022) – A 34.5 percent increase in new listings sparked 19,277 more showings during January compared to new listings and showings reported in December 2021. While an increase in new listings demonstrates a solid start for the real estate market this year, low inventory continues to harness the market’s potential. As a result of tight inventory, January sales activity could not meet the level of sales activity reported in January 2021. Historically, month to month sales activity during season ascends through April. But according to broker analysts reviewing the January 2022 Market Report released by the Naples Area Board of REALTORS^® (NABOR^®), which tracks home listings and sales within Collier County (excluding Marco Island), a 74.9 percent decrease in inventory for January to 1,122 homes from 4,474 homes in January 2021 will not provide the same level of sales transactions that occurred last season.

“Low inventory does not mean there are not opportunities for buyers in 2022,” said Ryan Bleggi, President of NABOR® and Managing Broker for John R Wood Properties. “In fact, as expected at the start of season, there was an increase in new listings during January compared to December, so buyers could explore an inventory that included 1,272 new listings.”

Those new listings translated to a 32 percent increase in pending sales to 1,373 pending sales during January compared to 1,038 pending sales reported in December.

“Cash sales exceeded 63 percent in January which is a good sign and proof that there is plenty of equity in the market,” said Adam Vellano, a Naples Sales Manager at Compass Florida. “Buyer demand has not slowed down and we’re seeing a rise in multiple offer situations as well as homes selling for above list price.”

The overall median closed price increased 39 percent in January to $549,000 from $395,000 in January 2021. The condominium market continued to report sales at an above list price trend for the second month in a row, and a 47.2 percent increase in median closed price in January to $427,000 from $290,132 in January 2021. The median closed price for single-family homes rose 25.1 percent in January to $675,000 from $539,500 in January 2021.

With less than a one-month supply of homes, closed sales during January could not realize the level of activity it experienced a year ago and decreased 27.9 percent to 818 closed sales from 1,134 closed sales in January 2021. Pending sales – which reflect the number of new homes under contract – decreased 37.9 percent to 1,373 from 2,210 in January 2021; but, as mentioned above, pending sales in January increased by 335 contracts (32 percent) compared to pending sales reported in December 2021 (1,038).

Molly Lane, Senior Vice President at William Raveis Real Estate, remarked that “if you’re a buyer, don’t expect to negotiate price in this tight market. Homes are being sold at full price or above list price and often without contingencies. I recommend working with a REALTOR® because they have the ability to help a buyer determine whether a home is priced competitively. I also recommend sellers work with a REALTOR® to price their homes right so a majority of offers can begin at full list price.”

The NABOR^® January 2022 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 2022:

New lending rules from Fannie Mae and Freddie Mac go into effect April 1st and add more requirements from those purchasing a second home or condominium. According to Wes Kunkle, President and Managing Broker at Kunkle International Realty, “Some condominium associations are changing their bylaws to prohibit renting within the first year of ownership, which discourages investors.”

Buying or selling a home in Naples is a big and fast-moving endeavor. That is why there has never been a more important time to work with a REALTOR® who can help you write a good contract that protects you and gets the paperwork in order so your sale or purchase goes smoothly. “I know a buyer who didn’t make the deposit on time and the seller cancelled the contract and took a back-up offer for $40,000 more,” said Vellano. “A good REALTOR® can help you avoid situations that might threaten a good opportunity.”

Mike Hughes, Vice President and General Manager for Downing-Frye Realty, Inc., admitted that regardless of when the current seller’s market ends, “Collier is running out of land to develop.” Vellano added that, “Buyer demand is not likely to slow down anytime soon because homes in Naples are still much more affordable than homes in other parts of the country like California, New York and Chicago.”

“I don’t know if we’ll see another 39 percent increase in median closed price year over year this year,” said Dominic Pallini, Broker at Vanderbilt Realty, “but we’re in a unique area of the world where there are buyers willing to pay to be here.”

We encourage the following groups of homeowners to consider listing their properties now if they want to maximize profits before the market changes:

Owners of rental property that require substantial maintenance and who could gain the same or more profit from investment dividends
Older homeowners whose future plans include living in a retirement or assisted living community
Empty nesters who don’t require a large single-family home anymore
Second-home owners who would enjoy a profit and can purchase a Naples home closer to retirement