Lee County’s real estate market stabilized for the 2nd straight month, further confirming that 2006 will be much more like 2002/2003 levels than 2005 levels.
As this chart illustrates, sales in August 2006 closely mirror 2002 levels. We are back to a normal market, and this is a healthy and encouraging sign. This is an end-user market, which is what it should have been all along until the investors found us and capitalized.
It may not feel like a normal market to some because of all the excess inventory on the market because of the investors who bought property with no end user in sight. Because of this fact in SW Florida, the investors caused the market to over supply. Investors sped up the supply 3-4 years ahead of what the market could absorb.
We probably have 3-4 years of over supply, and this market may feel a pinch for about 2 years until we eat into some of this over supply.
Fort Myers Cape Coral Single family home sales fell 29% in August 2006 from August 2005 levels, down from 968 homes sold to 691 homes sold. Prices fell 7% from $283,600 to $264,100 in 2006.
Fort Myers Cape Coral Condo sales fell 64% from August 2005 to August 2006 from 280 last year to 100 this year. Sale prices fell 15% from $278,100 to $237,500.
The good news is single family home sales have stabilized to about 690 or so sales per month, and median home prices have stabilized to about $264,000. We now know the monthly targets. It’s much easier to analyze the market once it hits a standard, and we think 2002 will be the benchmark.