When you see changes in the marketplace sometimes it’s helpful to put the data into historical perspective to see what trends may be developing if any, and what it all means.  In order to do this, you must first have data from the past.  Fortunately, we track all this data monthly and have for years, so it’s easier to go back and evaluate and identify trends.


Fort Myers & Cape Coral Listing Inventory
Fort Myers - Cape Coral Single Family Home Inventory


Listing inventory in just Fort Myers and Cape Coral is about the same as it was on January 2006 when it was headed up.  Back then pending sales were trending lower and listing inventory was just about to explode as the height of the market was really about 3rd quarter of 2005.  We still had some residual closings that took place up until December 2005 and into January 2006, but market activity really started dropping off in 2005.  Very few people realized it at the time as many were still busy and not watching the numbers.


Pending sales are actually higher right now then they were back then, although they’ve been trending down just a bit as inventory has fallen off.  Increasingly buyers are having a more difficult time scooping up the best buys because inventory has been falling and prices have been rising.


We’ve seen an influx of buyers wanting to get in on the bottom of the market, and many are coming to the sad conclusion that they missed the bottom.  Many experts have been educating buyers that they will always miss the bottom because you won’t really know it’s the bottom until you see it in the rear view mirror.  Only then do buyers believe it.  At the actual bottom buyers are greedy and either hope or expect the market will go lower, so they resist buying out of fear.  When they realize they’ve missed the bottom, the react out of fear of missing out on a rising market.  It’s a simple yet basic human emotion called greed, and greed shouldn’t be considered a bad thing unless it dampens your ability to evaluate what reality is.


Sellers tend to read headlines that prices are on the upswing and they also get greedy hoping for prices back in the heyday.  We’re not going back to heyday prices, nor should we. Prices were artificially too high back then, just as they’re artificially too low right now.  A market could not sustain those prices back in 2005 because incomes were not in line with the cost of ownership.  Today prices are too low because sale prices are so far below the cost of construction.  This is why we see very few building permits being pulled.  These low prices cannot last forever and will rise in time.  The question is how fast, and how high can they go.


We’ve already seen the beginning as median prices have risen over 35% since January in Lee County.  Nobody knows from here on out how much higher they’ll go or how fast as it really depends on future bank owned inventory entering the market, jobs, interest rates, and the overall economy.  All these factors influence the economy and the housing market.  What we can do is continue to provide graphs and show you what is happening in real time.  Armed with this information, and adding it to what you already know about the wildcards influencing our economy, you can pretty much draw your own conclusions and you might be about as right as the so-called experts.  It all begins with accurate information, and from there the analysis is fun.


Too often salespeople have an agenda, as in they’d like you to buy something or do something, so they report a distorted view, or at least a view of what they think is going on without real facts to back up their theory.  It’s been a tough 5 years for anyone in  the real estate industry including agents, brokers, mortgage brokers, title companies, attorneys, surveyors, builders, appraisers, etc. I’ve found that even in an up, down, or sideways market there is always a need for quality people in any profession, so you might as well present the facts and let the market decide on the pace and trajectory.  The market wins out every time and we all have to play within the confines of the market.  When anyone thinks they’re bigger than or an exception to the market, the market has a way of explaining things.  Buyers, sellers, agents, banks, etc. have all learned this lesson, so let’s not let history repeat itself, and when it does hopefully it will repeat on someone else.  We’ll keep providing the data we’re looking at, and good luck accomplishing your goals in this market.


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