2019 Ends with Strongest Year in Home Sales! Naples Florida Market Trends
According to the 2019 Year End Market Report released by the Naples Area Board of REALTORS® which tracks home listings and sales within Collier County (excluding Marco Island), existing home sales through December 2019 are the highest the last years. Overall closed sales in 2019 increased 5.6 percent to 10,244 closed sales compared to 9,704 closed sales in 2018. In comparison, the only other year that came close to reaching this stellar sales activity was 2015, which had 10,154 closed sales.
Overall pending sales in 2019 also broke a record during the last decade; resulting in 12,604 total pending sales, a 9.4 percent increase over 2018, which reported 11,520 pending sales.
The 2019 Year End Market Report showed closed sales in 2019 increased in all but the $2 million and above price category, which had a 4 percent decrease to 523 closed sales compared to 544 closed sales in 2018. Of those in this price category, 376 were for single-family homes, and according to a local Broker. “The MLS further revealed that 14 single-family homes priced above $4 million closed in December 2019 compared to just 7 in 2018.”
Condominium closed sales held steady with a 1.9 percent increase in 2019 to 5,085 compared to 4,990 in 2018, but broker analysts reviewing the year-end report anticipate closed sales of condominiums in January will be much higher, especially since pending sales for condominiums increased 28.8 percent in December.
A breakdown of December’s closed sales by area showed Naples Beach reported the highest increase in closed sales during December with a 59.1 percent increase to 140 closed sales compared to 88 closed sales in December 2018. Closed sales by zip code revealed 34113 and 34108 commanded impressive increases, 62.3 percent and 61.5 percent, respectively, in December 2019 compared to December 2018.
“Growth in the eastern part of the county, including the addition of many desirable amenities like restaurants, retail shopping centers, banking, and personal care, is redefining what is a desirable ‘location’ for Collier County,” said a local Broker “West of 41 was a location high point for many years, but I think buyers are finding beach proximity is less important than the lifestyle offered in and around new communities now.”
While inventory fell 21 percent in 2019 to 5,401 properties compared to 6,801 properties in 2018, the Collier County market is still commanding a much higher supply than the state’s average levels. As such, the Market Report showed Collier County enjoyed 6.2 months of supply in the single-family home market during December, while the state reported 3.6 months of supply for the month. Likewise, the report showed 6.4 months of supply in the condominium market for December compared to 5.5 months of supply statewide.
The Numbers, Florida as a State
The year 2018 was rather characterized by weak sales figures, many properties on the market that raged for months there due to a sharp rise in interest rates for long-term loans, a strongly fluctuating stock market and a government that was paralyzed in late 2018 until January 2019.
But a year can make a lot of difference. All in all, December in Florida in real estate sales increased by an incredible 24% in single-family homes and 18% in condominiums as of December 2018!
Why is that? You can usually see a very strong increase in sales in December in most years, as many are still trying to complete the purchase before the end of the year. This peak did not exist in 2018. A large part of the extremely high plus compared to the previous year results from the “peak” not taking place in 2018. However, this does not yet explain the complete increase.
Rather, the falling interest rates for long-term loans and probably also the increasing demand from countries with high taxes. Previously Texas was the No. 1 place of refuge for “tax evaders”, this has now become Florida in 2019! However, every medal has two sides, if the seller is pleased with the increased demand and rising prices, you can see that 11% fewer new properties are coming onto the market in the single-family home area and that the range of properties in the ETW area has decreased by 10%.
But how are the numbers in Collier County? And what can we expect the next years or decades in Naples and surroundings?
NAPLES – IMMOKALLE – MARCO ISLAND
Buyers Market Homes /Closed Sales + 10,4 % Median Sales Price $435.000 – 2,5 % / Average Sales price – 3,2% / New Listings -2,8% / Inventory (month av)+ 3,4% / Months Supply Inve. 7,8 / -2,5%
Buyers Market Condos/ Closed Sales +3,1% / Median Sales Price $ 268.250 – 2,5 % / Average Sales price -2,9% / new Listings -2,1% / Inventory(month av) + 1,3% / Month Supply… 7,6 / -1,3 %
At first glance, you can clearly see a buyer’s market here and it is much more pronounced than in all other regions compared here, both in the EFH and in the ETW area. Where does it come from?
Especially in Naples, which, according to various resources, is one of the richest cities in all of the United States with more than 12,000 millionaire households (report from 2017 City Info)
It begs the question… Does nobody want to buy here? Or why are the properties on the market for so long? Naples has always ticked differently. Here, a very strong “second home market” dominates more than almost all other regions in Florida paired with the very relaxed financial situation of most residents. Which leads to the fact that the fewest owners do not necessarily sell and the fewest buyers, which is usually a second home, do not have to buy or are in a hurry.
Unlike in neighboring County Lee (Fort Myers etc.) where many owners are families who live full-time on site and also work in the region. The long time in the market in Naples also reflects the unrealistic ideas of many sellers far from prices what the market in the neighborhood has to offer. If the property remains on the market for too long, the price drops, which means that some properties are actually sold below their actual value as if they had been offered realistically from the start.
Of course, the buyers who watch the market and consciously wait until the seller becomes realistic and then strike at a reasonable price, of course with another negotiation – the seller is now tired! However, just like in the other regions, you can see that 2019 had started rather cautiously, the length of stay was much longer and the number of sales did not increase rapidly until the second half of the year. The best sales month with 36.1% increase over the previous year at the single family house and 42% in the Condos was December 2019!
Overall, 2019 was one of the best years in sales in this decade. Only 2015 was higher here.
NAPLES REAL ESTATE MARKET, WRAPPING UP
The market seems to be changing significantly, sellers can currently look positively into the future if they enter the market realistically. Because the sales and thus the demand for real estate, correctly priced is high! For buyers, the current market means that it is a good time, with a little patience and negotiation skills, to get a property at a fair purchase price. And depending on the location and price segment, you can make a good deal.
And what can we expect the next years or decades in Collier County?
Florida is #1 in the Top 5 destination states! So we don´t wonder about the new estimates for Collier County. We have around 382,500 residents in Collier County in 2020 we will expect an estimated number of 535,426 people by 2040! That means around 7,000 new residents each year! So it is time to make an investment before the prices for properties in Naples will raise.
Looking for Naples Florida Market Trends for 2020?
Reach out to a local Naples Real Estate Agent like AJ International Group Naples, with Berkshire Hathaway HomeServices to get up to the day Naples Florida Market Trends and other information to help you with buying or selling in Southwest Florida.