Naples Area Board of Realtors Mike Hughes was somewhat subdued on Thursday as he announced the latest data for the real estate market in Collier County.
NABOR’s second quarter market report showed double-digit declines in pending and closed sales. It’s provided for a splash of cold water after a torrid 2015.
“We’re facing some headwinds,” Hughes conceded. “We have a nasty presidential election, and I don’t care who you’re for, it’s going to continue to be nasty until the election takes place. So that’s one thing that’s affecting consumer confidence.”
Hughes added that continued weakness in the Canadian dollar has limited international buyers this year, another in a series of issues that have slowed the market down in 2016, starting with a jittery stock market at the first of the year. Other outside factors, including the “Brexit” vote in the United Kingdom, and recent civil unrest regarding police-involved shootings have also created unease within the market, Hughes said.
Pending sales dropped by 11 percent over the same period a year ago, with closed sales falling by 14 percent. Median closed price, which rose by double digits in 2015, has remained virtually flat, growing by 2.0 percent to $325,000. Meanwhile inventory on the market rose by 35 percent over this time last year.
“[T]he days of impressively peaking values and expecting a price over market value are in the past,” said Kathy Zorn, of Florida Home Realty.
One matter that can be resolved at the local level is pricing. A recent market report from B.E.A.R, Bonita Springs-Estero Area Realtors, put some of the blame on sellers setting prices above what the actual market value is.
On Thursday, NABOR agreed.
“If you’re a seller, it’s really critical that you price your property correctly,” Hughes said. “You need to talk to a realtor, and you need to find out how to price correctly. You still see some out there who are trying to shoot for the moon, and trying to get a huge profit. There’s no reason in this market that a property won’t move if it’s priced correctly.”
The housing market is also having to compete with new construction, which MLS data doesn’t track. Factoring new stock onto the market, along with gains made from the first quarter, makes the situation look a lot better, says Bill Coffey of Amerivest Realty Naples.
“Over $300,000 is only down 3.5 percent. That’s nothing, that’s 34 units,” Coffey said. “10 units per month. There’s not a doubt in my mind those 10 units are being fed by new product. If we were able to look at the entire market, we’re probably up.”
At least, that’s the case for single-family homes. Condo sales were down 19 percent.
“There’s nothing good I can say about condos right now,” Coffey said. “There’s not a single price range that’s up.”
Analysts have been trying to make very clear that 2015 was a bit of an anomaly, and have been comparing today’s market to that of the early 2000’s, before the subprime boom sent prices rocketing.
“Despite all these factors, it’s still been a solid year,” Hughes said. “I think that if buyers see their way through all these national and international worries that are out there, the reality is this area’s still paradise. I think those that buy now may look up down the road and be pretty happy that they bought.”
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