While home prices may be lackluster, 2018 local home sales are still at a near record pace.  With YTD data compiled through October we see 2018 better than both 2017 and 2016 numbers, and only slightly behind 2015 numbers.  November was a strong month, so when official numbers are released later in December, we believe we may even close the gap a bit heading into finishing out the year.

2018 Local Home Sales Still at Recent Record Pace

2018 Local Home Sales Still at Recent Record Pace

We hear so many agents talk about a shift in the market.  We can’t rule out what may happen in the future.  All we can do is discuss what is happening now. Right now, we haven’t seen a shift in pricing or sales numbers.  There may be another kind of shift we’ll discuss later.

Home prices have been flat since January 2017.  Today’s prices are roughly what they were 2 years ago, and they really haven’t changed much over the last two years.  While the rest of Florida and the country have appreciated, Lee County has not.  We don’t see a significant bubble ahead because of this fact, and because this market is different than the last bubble.  We have end users for homes.  In 2006 we didn’t.

Pressure

 We have pressure in the market.  Interest rates have risen which has lessened affordability for buyers.  The pressure is simply market forces exerting itself on the market.  Pressure will influence direction, and not necessarily change it.  In other words, pressure can limit growth without causing negative pricing.  If you add enough pressure, it can.  Pressure can come from a variety of sources.  Interest rates, wages, economic growth, unemployment, tourism, politics, taxes, supply, demand, and many more.  When you throw them all in the crock pot, its fun to see which ones win out.  We can predict, but forces are always changing in intensity and scope.

Other Shift

 Sometimes in business the numbers don’t change, but the way business is conducted does.  When Amazon entered the market, physical retailers may have sold less, while online sold more.  Overall sales could have been more or less, but it was certainly less for the physical retailers.  The same can be true in real estate.  We could have the same number of transactions, but agents accustomed to doing a certain amount may feel like the market has shifted because their numbers are down, when it really hasn’t.

Real estate is changing.  Sellers aren’t always reaching out to agents who have a track record of selling homes for more money, and faster.  Sellers are selecting agents by who called them on phone, who they saw online, or at an open house they attended.  It’s harder and harder for consumers to know which the really good agents are.  Some of the really good agents are scratching their heads and wondering where the business is going and wondering why consumers aren’t contacting them as much.

Advertising that used to work 10 years ago may be less effective today.  The point I’m making is agents can’t judge the health of the market by how their own sales are going.  Just because an agent’s sales are up 20% or down 20% doesn’t mean the market is.  The Ellis Team is up big time in 2018, and yet we realize two things.  We must keep adapting or we’ll get run over, and we have to keep our eye on the local market and look for changes.

Agents Must Keep Up With Technology

Change is inevitable. It’s like raising a child.  Perhaps you’ve done a great job and your kids are great at 12.  They’re not fully done yet, and you must keep it up for many more years.  Things can change quickly if you don’t stay on top of it.  The market may be balanced today, and move in a year or two.  Forces change, and so will the market.

Always call the Ellis Team at Keller Williams Realty Fort Myers & the Islands with your real estate questions.  If you’re thinking of selling, ask for Sande or Brett 239-489-4042 Ext 4  Or visit www.LeeCountyOnline.com to sell all the homes in MLS and find your piece of paradise.

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While many agents in SW Florida are complaining about lack of closings the numbers just do not bear this out.  Statistically average sale prices are about what they were in the boom of 2005 and early 2006, and 2018 single family real estate closings almost at boom levels as well.

Back in 2005 we had 12,273 single family closings.  In 2017 we had 12,356, and 2018 is on track to beat that.  The peak for closings was between 2009-2011 when prices were a lot lower.  Today we have peak level pricing and high levels of sales.

2018 Single Family Real Estate Closings Almost at Boom Levels

Looking at the single-family homes sold chart shows 2018 neck and neck with 2015 levels, which was a very good year.  We ran Year to Date numbers and discovered 2018 is just 16 closings shy of the 2015 pace.  When we look at real estate pricing along with months supply of inventory, we realize the 2018 real estate market is doing very well.

2018 Single Family Real Estate Closings Almost at Boom Levels YTD Closings

Back in July 2015 the months supply of homes was 3.8 months.  July 2018 it stands at 4.9 months.  Anything below 5.5 months is considered a seller’s market.  The median price in 2018 stood at $255,000 and the average stood at $350,566.  Back in July 2015 the median sold price was $209,830 and the average stood at $326,883.  In 3 short years that’s a 21.53% rise in median price and a 7.25% rise in average prices.

Real estate agents tend to report on how the market is doing in direct relation to how their business is doing.  This is not a good way to judge the market as shifts in market share can affect your production, and not necessarily the market.  The average agent does less than 1 deal per year.  The average full-time agent may do less than 7 deals per year.  If an agent’s production goes from 7 deals one year to 4 deals the next, it might feel like a drastic market change has occurred to that agent.  The reality is maybe their marketing isn’t working like it used to, or maybe they’re not working as hard or as efficiently as before.  Neither scenario is a good market indicator.

Our team consistently sells over 100 homes per year.  This year our goal is 225.  Because we’re big advertisers, our homes sell fast and for top dollar.  Large teams like the Ellis Team may siphon off more deals from single agents which cuts their production to less than last year’s levels.  In this case, it feels like the market isn’t as strong, and they honestly tell this to their clients because that’s their experience.

It pays to study the numbers.  Agents should study their numbers and compare them to the overall market.  In doing so they’re much more likely to spot actual trends in the market and rely less on feelings and estimates.

We’ve been studying the market for decades, so we know when the market is on the move.  Getting Top Dollar is a function of knowing exactly where the market is, and quite possibly where it’s heading.  The only way you can do this is to know exactly where it is and exactly where it’s been.  Experience and market conditions fill in the blanks from there.

Whether you’re buying or you’re selling, you need to know this information.  Make sure you’re working with an agent that studies the numbers.  If you’re considering selling, call Brett or Sande Ellis 239-489-4042 Ext 4.  If you’re in the market to purchase, our team can help you too.

For a free computer analysis of your home’s value, visit www.swflHomeValues.com  We have an app that has all the open houses every weekend.  If you’re interested, give us a call.

Always call the Ellis Team at Keller Williams Realty!  We’re here to help, when you need us and how you need us.

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Open Saturday 1-3 PM

Florida International real estate sales rise 21% of total dollar volume and 15% of total sales in 2017.  Both numbers were up versus 2016 numbers.  This tells us that foreign buyers are here purchasing, and because the total volume is higher, they are purchasing higher than average priced homes.

So where are these Lee County foreign buyers coming from?  According to the Florida Realtors profile of international real estate activity, Lee County saw the largest amount coming from Canada, followed by Germany and United Kingdom.

Florida International Real Estate Sales Rise Where Lee County Foreign Buyers Come From

Florida International Real Estate Sales Rise

Just this past week the Ellis Team placed a property under contract with a Canadian buyer, and we just completed a transaction with a German owner.  Over the course of time, these countries fairly well describe who buys in Lee County from overseas, but there are fluctuations.

Two factors that influence foreign buyers are the changes in currency valuations, and the home price growth from the foreign country.

The Canadian dollar hasn’t moved much against the US dollar, so you might wonder why the increased interest.  Canadian home prices have been sky-high.  They have equity. Some say they’ve risen so high the bubble might burst as there is no rational basis for why their prices have grown so high.  But then again, there never is in Canada.  They have their own economic forces.  It’s like gravity is different up there.

Canada was number 4 in the world for real price growth behind the Philippines, Hong Kong, and New Zealand.  This confidence and equity has spurred opportunities for Florida as Canadians love visiting our sunshine and beaches.

72% of foreign buyers pay cash. But Canadians only finance 14% of the time. United Kingdom buyers finance 23% of the time.

Ellis Team markets to Foreign Buyers

The Ellis Team markets to foreign buyers as well as US buyers.  In a market like Florida you have to market to reach the entire universe of buyers.  Especially given the fact that 21% of Florida’s sales volume comes from foreign buyers.

While this report covers all of 2017, there can be shifts. We study our website traffic over the last year and compare to the last month and week. We see some recent changes.  This past week Canada still led the way, followed by Germany and Sweden.  United Kingdom is at #9 for the year and not even in our top 10 for the last week.  Brazil slipped to #9 in the past week.  They’ve been in the #6 spot for the past year.

Ellis Team LeeCountyOnline.com International Visitor Count October 2017

Changes in currency, political environments, and home prices abroad can affect our market here quickly.  We can monitor on a week to week or even day to day basis.

The bottom line is, if you’re only marketing to local buyers you’re missing out on a large portion of the market.  In addition to 21% of the volume from international buyers we sell many homes to US citizens from other states.

Florida International Real Estate Sales Rise Website Visitors By State

Over the past year Illinois lead the way in property searches on LeeCountyOnline.com followed by New York and Michigan.  It’s no wonder we’re working with so many buyers from IL right now.  The Ellis team is working with buyers from all 10 of these states.  They are searching for property in Southwest Florida and we are helping them purchase it.

Thinking of Selling?

If you’re thinking about selling your SW Florida property, it pays to work with a Realtor that markets across the US and internationally.  Have them show you how many buyers they’re generating and from where.  If they can’t show you, they either aren’t marketing there or don’t focus on it.

The Ellis Team will be glad to sit down with you and see how we can help you get top dollar for your home.  Call 239-489-4042 and ask for Sande or Brett.  Or feel free to search our SW Florida MLS Search Site  The rest of the world does.  You might as well too.

 

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