There are, indeed, MANY new trends and significant changes that reflect the paradigm that exists now vs. the boom years of 2002-2005.
The good news is that the qualified buyer now has unlimited opportunities to acquire a beautiful house, villa or condo at an amazing discount to previous value. In the boom years, it was very difficult to sell property due to the lack of inventory and affordable homes. I would personally get my name on the waiting lists of new property offerings as they were released by Developers. It was important to “get in” on the pre-construction pricing since the prices kept rising so fast. Multi-million dollar high rise condominiums were increasing in price by $100,000 a day. There was also an increase in “for sales by owner” properties, since the owner simply had to hang out a for sale sign to sell their home. Vacant lots in residential areas were gobbled up at premium prices and negotiating down the price of any property was close to impossible. Speculators were everywhere.
2009 is a far different story. First of all, there is approximately three years worth of inventory available. The speculators are gone, most poorer than when they arrived. Large Developers such as WCI are in Bankrupcy and homeowners who refinanced, took out and spent HELOC funds and/or took a chance on ARMs with large rate spikes are now selling their properties as short sales or have been foreclosed on by their Bank. Other homeowners are selling, for various reasons, at 50% of what they purchased the property for or what it was valued at during the peak. Because of this, many realtors, including myself, are becoming Certified Specialists” in distressed property sales in order to help buyers and sellers navigate through this much more difficult process and in many cases help homeowners avoid foreclosures.
What I am seeing in our 2009 “busy season” is a trend of careful lookers from the Midwest and Northeast. Since 2009 is probably one of the worst winters we’ve had in long time up north, SW Florida and our terrific weather is still very much on the minds of the baby boomers. There has been a large increase in seasonal rentals and there are still good rental deals available. I have shown homes to potential buyers who have money and who feel that real estate is a better investment than the stock market right now. They are cautious and looking for tremendous deals. I am showing high-end luxury homes that cost $2.4M to build and are now selling short at $1.3M, and high rise condominiums now offering for $500K that were previously listed for over $1M.
The real story, though, is the amount of activity in the under $400K range. During the boom years, there was nothing in the MLS under $350K. Now, there are thousands of home showings and many people sitting on the side lines, just waiting for the “end of season” fire sales.
The current “economics driven” Real Estate situation here in beautiful Naples and surrounding areas is a huge story, many times heartbreaking but certainly opportunistic if one has cash. There are different market segments here and while the prices are dropping drastically in some areas, there are other areas holding their value much more such as beach front and high-end golf communities.
Here are some figures from the MLS system that show some positive signs about the market here beginning to pick up.
•January 2009 real estate sales were up 18% vs. January 2008.
•December 2008 real estate sales were up 50% vs. December 2007.
•Full Year 2008 real estate sales were up 21% in Naples/Bonita/Estero vs. a 10% decline for US national sales.
•Naples/Bonita/Estero sales are up 45% since July 1, 2008.
Prices are Down/ Sales are Up:
Median Price:
January 2006:$450,000(market peak)
January 2007:$407,000
January 2008:$380,000
January 2009:$190,000
Pending Sales:
January 2006:721
January 2007:587
January 2008:501
January 2009:885(market peak)
