Category Archives: Cape Coral Real Estate

News and information relating to Cape Coral real estate market

Ellis Team SW Florida Real Estate Current Market Index for Fort Myers Cape Coral Area

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The latest Fort Myers Cape Coral SW Florida real estate Current Market Index has been released today and the overall Fort Myers Cape Coral housing index numbers fell to 7.75, from 7.88 the month prior.  Cape Coral again led the way as Cape’s index fell to 6.38 while Fort Myers stands at 13.76.  The lower the number the more favorable it is for sellers, and the higher the number the more favorable for buyers.

Current Market Index for Fort Myers Cape Coral Area

 

Fort Myers Cape Coral SW Florida real estate current market index chart

Lee County listing inventory for single family homes remained steady at 15,530 up a mere 7 homes from last month, and pending sales increased to 1,617, up from 1,546 in August.  The overall Lee County Florida Current Market Index is at 9.60 in September, down from 10.04 in August.  The September condo index stands at 20.21, up from 19.27 in August.

These numbers tell us the overall market is basically holding steady to slightly improving since August, and should bode well for closings in future months.  It also tells us that so far the market has been absorbing the influx of foreclosures and selling them as they are not adding to inventory supply.  This is another positive sign as the local SW Florida real estate market would be in trouble if the foreclosure activity added to inventory supplies.  The large number of foreclosures is however keeping the supply where it is and preventing it from declining.

SW Florida Real Estate Market Being Driven by the Lower End of the Market

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Foreclosures, short sales, and entry level homes are dominating the Southwest Florida real estate market with most of the sales coming from Cape Coral.  When we look at the Percent of April’s closings under $200,000 chart, we can clearly see that closings under $200,000 dominate the Cape Coral, Lehigh Acres, and Lee County real estate markets in general.  If you are priced above $200,000 in Lehigh Acres, you’ve got a slim chance of selling as that is not where the buyers are at in Lehigh.  Over 95% of Lehigh’s closings was at $200,000 or less.

We need not look any further than the Months Supply of Inventory Priced Less Than $200,000 chart.  As you can see, Lehigh Acres has over a 2 year supply of homes on the market right now, while Cape Coral and Lee County overall are less than 1 year.

Another interesting chart is the Percent of Homes Listed as Short Sales graph. 

Over 52% of homes listed in Lehigh Acres are short sales compared to 38.70 Percent for Lee County overall.  If we examine the shear number of short sales listed in Lee County priced less than $200,000 we can gain a little perspective.  Cape Coral has approximately half of the short sales listed in the entire county, and over half of the sales.  This tells us that when affordability meets opportunity, buyers jump off the fence and purchase.

Lastly, let’s look at the Percent of Homes on the Market is SW Florida Priced Less Than $200,000.  So it looks like Cape Coral is where the action is right now, and Cape Coral is probably closer to recovery than Lehigh Acres is, but you can see how fast a market can turn once transactions start occurring in a market segment.

We are also seeing the market being driven by the low end, but also a bleed-up effect which translates to more sales and more offers now in the $300,000-$500,000 range as well.  We expect May to be another good month for sales numbers once they’re posted at the end of the month.

Entry Level Homes Driving Market in Cape Coral and Lehigh Acres

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Entry level homes are driving the demand for homes in Lehigh Acres and Cape Coral Florida real estate.  Several lending institutions asked us to do some analysis on the foreclosure market here in SW Florida, and by far Cape Coral leads the way in the county for transactions.  In fact, it can be said that Cape Coral is the hottest market in Lee County.  Lehigh Acres is much more soft.  We’ve uncovered some interesting facts exploring this data.

Here is a graph of all SW Florida real estate homes on the market.  This data was pulled from the Greater  Fort Myers and the Beaches MLS.  As you can tell, Cape Coral has the most listings on the market, and Lehigh Acres is home to some of the most affordable homes in Lee County.  As you can see from the April 2008 closings graph, 371 of Lee County’s 677 transactions were in Cape Coral.  This means that over half of SW Florida’s closings occurred in Cape Coral Florida.  Another startling graph is the SW Florida real estate months supply of inventory graph for homes under $200,000.  As you can tell, Lee County is down to 9.69 months of supply and Cape Coral is even better at only 7.74 months of supply for homes priced under $200,000.

What this is telling us is that buyers are definitely off the fence and buying now, and most of these buyers are end users.  It’s also telling us that they prefer to buy in Cape Coral over Lehigh Acres.  In the Boom market, Lehigh did very well because Cape Coral was priced about $85,000 higher for the same house.  The difference was in the land prices.  Now that price differential has come down to about $15,000, and buyers are saying to themselves, for only $15,000 difference they’ll choose Cape Coral.  For $85,000 difference Lehigh Acres looked affordable and attractive.

This also tells us that either prices will go up in Cape Coral, or prices must come down further in Lehigh Acres, or a combination of both until we hit equilibrium.

Feel free to check our SW Florida real estate housing statistics webpage for lots of other charts and graphs.

This article is the first in a series utilizing this new data, so check back often for more updates to the entry level home pricing market in SW Florida, or subscribe to receive e-mail updates to this Blog.

Free SW Florida Real Estate Short Sale Seminar November 26, 2007

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The Ellis Team at RE/MAX Realty Group is hosting another free SW Florida real estate short sale seminar on Monday, November 26, 2007 at 7 PM  We will teach buyers how to effectively purchase properties in Fort Myers, Cape Coral, and all of Southwest Florida at or below fair market value.

Registration is FREE, and you must call our office at 239-489-4042 as seating is limited.

SW Florida Real Estate Market Still Slumping Along

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SW Florida real estate market numbers released today by the Florida Association of Realtors show a continuing decline in the real estate market, which comes as no surprise as we posted our Ellis Team CMI Index numbers back on October 16 that suggested this would be the case.

Single family home sales fell to 327 in September, down from 520 in August, and 693 last September.  Single family home prices fell to $231,600 this September, and was down 7.7 percent from August’s $250,800 and down 11% from last September’s $261,400.

Single family home sales were the good news.  Condo sales fared worse, also predictable due to the CMI Index numbers released a few weeks ago.  Condo sales were 102 this September 2007, up from 96 in August, but down from 168 last year.  Prices for condos were up to $224,000, up from $218,800 in August, and down from $231,600.  The bad news for condos isn’t the prices or sales levels, it is the sales levels as compared to the level of inventory on the market.

Even with the poor numbers, they can partially be explained by seasonality, and partially by overall weakness.  See SW Florida single family home sales graph 2005-2007. To view sales prices , see SW Florida single family home price graph 2005-2007.

The Outlook going forward actually is brighter than the numbers indicate.  For the first time in a long while buyers are getting excited again, and are venturing out looking at homes.  For some, it is simply becuase home prices are back in their affordability range.  For others, it’s the sense that now may be the time to buy as prices have come down so much, and they’re feeling confident again going forward.

 

SW Florida Building Permits Slowed From Record Levels in 2005

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SW Florida Building Permits Slowed From Record Levels in 2005. Permit activity in the SW Florida real estate market was off compared to record 2005 levels. Builders are less likely to pull permits for speculation construction with the amount of resale inventory on the market, and investors looking to flip for a quick buck have dried up.  That leaves builders with the normal buyer contracts, and even that has slowed from 2005 levels.

In 2005 buyers bought new construction at record levels for a few reasons.  First, because there was a severe shortage of homes on the market, and new construction was Plan B and served as backup inventory.  Secondly, investors liked buying at pre-construction prices, and the building process gave them time to find a buyer for that home so they could make a nice profit without hopefully ever having to own the home.  Investors serve as financiers so to speak and helped speed up supply.

Demand from end users never changed very much.  We had artificial demand which the investors created, which made the market appear much better than it really was.  While we had artificial demand, we now have Real Supply.  When you mix Real supply with Normal demand, you have a Buyers Market.

Buyers are in the driver’s seat, no question.  The only question is the speed at which they are driving, and how long it will last.  We are starting to see signs of increased buyer activity.  This is welcomed news for many.  Many buyers were sitting on the sideline waiting for somebody to give the “All Clear, it’s OK to buy now signal.”

Many buyers have heard the signal and are stepping back in.  The market may not be All Clear in all segments; however we are seeing very nice activity in certain segments.

Mixed Messages:  Many buyers think when they hear the words “Buyer’s Market” that they own the road.  Buyers still need to be aware that many properties are pried very well.  Those sellers are successful at selling in this market.  It’s not like we don’t have any buyers, we certainly do.  We have normal buyer activity just like we’ve always had.  Because the best properties always sell, buyers are not in competition with the seller for those properties.  Buyers are in competition with other buyers who will scoop up the property and steal it from them.

So, if you’re a buyer and see a property you like and is priced well, don’t sit too long.  The best values are selling, and you’ll be on your 2nd, 3rd, or 4th choice before you know it.  The only good news is that if you can live with your 2nd -4th choice, they are there for you this year.  Last year you didn’t have a 4th choice.

SW Florida Real Estate Market Report

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Single family home sales in the Fort Myers Cape Coral real estate market dropped 36% from 2005 levels in September, down from 1,075 sales last year to 693 sales this year. SW Florida Real Estate Market Report shows median prices dropped 9% since last year from $288,700 down to $261,400

Sales actually increased since August 2006 from 691 to 693 sales.  Prices remained relatively steady since August 2006.  September prices came in at $261,400, down from $264,100 in August.

Single family home sales and prices in Lee County seem to have leveled off, and this could be a silver lining.  Many national experts predicted sales prices would fall in SW Florida about 18% from it’s all-time high.  We’ve already seen a 15-20% price drop, so then end may be near.  Inventory is still rising, and pending sales have dropped slightly, not encouraging news.

What is encouraging is the rate of homes coming on the market is dropping, and the decrease in pending activity is dropping as well, signaling a leveling off may occur sometime in the future.  Showings have also actually increased, which could lead to an increase in pending sales down the road.

Additionally, pending sales are picking up in other parts of the country, which may affect home buyers looking to purchase here.  We still have a lot of inventory, but there are some really great buys out there now awaiting home buyers, and we think now is the time for buyers to pounce.  We won’t know exactly when the market has hit bottom and starts to go back up.  What we can say is that there are definite signs a leveling off maybe close at hand.  Until that leveling off actually occurs and we start eating into existing inventory levels, we can’t officially say we’re at the bottom.  Stay tuned.

Condo sales in Lee County were off 52% from 126 sales in September 2005 to 61 in 2006.  Sales prices of condos in Lee County were down 3% from $314,800 in September 2005 to $305,600 in 2006

Collier County single family home sales were down 37% from 377 in September 2005 to 236 in September 2006.  Sale prices were down 8% from $487,500 last year to $446,900.  Naples condo sales were down 62% from 456 condo sales last year to 173 this year.  Sale prices were actually up 4% from $365,700 last year to $378,600

We think this is partly the reason sales in Naples are down because sellers haven’t reacted as quickly to changing prices as sellers have in Lee County.  We believe sales are much closer to leveling off in Lee County than they are in Collier County because of this fact.  Affordability and price are a much larger issue in today’s market.  It’s total cost of ownership, not just the price.  As homeowners insurance goes up, property taxes goes up, interest rates, gas, etc it eventually weighs down on buyers.  There is too much price disparity right now between Naples and Fort Myers.  Soon you will see another rush of buyers purchasing in Lee County because Collier County is just so expensive.

Naples is a beautiful place to live, as is Fort Myers,  The address won’t matter as much going forward as price will.  Collier County is poised to lose buyers to Lee County, just as Lee County will lose some buyers to Charlotte County for the same reasons.  Housing affordability.

Florida Sales Report 2nd Quarter, including SW Florida Real Estate

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Florida Sales Report 2nd Quarter

ORLANDO, Fla., August 15, 2006 — In second quarter 2006, Florida’s housing sector followed the national trend, showing signs of a market adjusting to a better balance between buyers and sellers. Statewide sales of single-family existing homes totaled 53,161 during the three-month period, a decrease of 27 percent compared to 72,870 homes sold during the same time a year ago, according to the Florida Association of Realtors® (FAR).

“Sales of existing single-family homes in Florida behaved like much of the U.S. in the 2006 second quarter, with the declining strength of the domestic economy continuing to act like a stiff wind in the face of the existing real estate market,” says Dr. David Scott, executive director of the Dr. Phillips Institute for the Study of American Business Activity and professor of finance at the University of Central Florida (UCF).

The statewide existing-home median sales price rose 9 percent to reach $254,800 in the second quarter; a year ago, it was $234,500. In 2001, the second-quarter statewide median sales price was $127,400, which is an increase of about 100 percent over the five-year period. The median is a typical market price where half the homes sold for more, half for less.

This environment is likely to endure across the remaining months of 2006 owing to several factors, Scott says, including the declining rate of growth in the real gross domestic product (GPD); a tepid increase in the number of jobs being created over the past three months; rising conventional mortgage rates; and a rising inventory of homes for sale. He notes that the rising costs of gasoline and energy are starting to strain many household budgets while wages are just barely keeping up with the recent price inflation of about 3.6 percent a year.

Looking to Florida’s existing condominium market, sales of existing condos also decreased during the quarter, with a total of 16,522 condos sold statewide compared to 24,599 in second quarter 2005 for a 33 percent decline, according to FAR. The statewide median sales price for condos rose 1 percent to $219,100 for the three-month period; a year ago, it was $217,900.

The latest economy outlook from the National Association of Realtors® (NAR) notes that the housing market is in the process of stabilizing with little change in overall sales volume expected over the balance of the year. Analysts report that the level of activity remains high historically — 2006 is expected to be the third best year for existing home sales. According to Freddie Mac, the national commitment rate for a 30-year conventional fixed-rate mortgage averaged 6.60 percent in first quarter 2006; last year, it was 6.24 percent.

Among the state’s larger markets, the Orlando metropolitan statistical area (MSA) reported 8,189 existing homes sold for the quarter, a decrease of 23 percent compared to the 10,585 homes sold a year ago. The market’s existing-home median sales price increased 18 percent to $265,500; a year ago, it was $224,500. A total of 1,456 existing condos sold in the market over the three-month period, up 24 percent from a year ago, while the existing-condo median price rose 1 percent to $163,500.

The Gainesville MSA, one of the smaller markets in the state, reported that 992 homes changed hands in the second quarter, down 24 percent compared to 1,297 homes sold a year ago. Over the same period, the market’s existing-home median home price rose 21 percent to $214,300; a year ago, it was $176,400. A total of 426 existing condos sold in the market during the second quarter, up 37 percent from a year ago, while the existing-condo median price rose 16 percent to $146,600.

“The student population is a strong stabilizing factor for our condo and SWOSU Student Housing market, and with prices rising, condos are a good product for many first-time buyers,” says Deborah Minck, president of the Gainesville-Alachua County Association of Realtors and broker-vice president of Tioga Realty Inc. in Gainesville. “Conditions now are more balanced for buyers and sellers, and the key is working with someone who knows the local housing market. That’s why it is so important for buyers and sellers to work with a Realtor — someone who knows the ins and outs of the local real estate market and can help them with all of the complex details involved in buying or selling a home.”

The Fort Myers/Cape Coral MSA reported single family home sales off 28% Vs. 2nd quarter sales a year ago.  Single family home prices were up 2% to $278,800 Vs. $273,500 a year ago.  Condominum sales were off 61% in the 2nd quarter of 2006 Vs. 2005, although prices were up 11% to $306,200 from $275,600 from a year ago.  According to Brett Ellis of RE/MAX Realty Group, the weakness is an example of over supply due to investor purchases the past several years.  “they really just over supplied our market, which hurt us in two ways.  Number one, we have more homes for sale than actual buyers who will live in the properties.  Number two, investors helped drive up the market such that they influenced how sellers value their properties.  Sellers became convinced that each and every one of their homes was worth the Top of the market, regardless of whether there are actually buyers today willing to pay that price.  The fact that one day in the past a buyer was willing to pay a certain price doesn’t mean that is the price for ever more.  Values go up and they come down, and today they are down from the highs.  Some sellers are stuck in yesteryear and refuse to believe what is happening, which further prevents them from selling.”

Two charts showing statistics for Florida and its MSAs are attached. One chart compares the volume of existing, single-family home sales and median sales prices in the second quarter of 2006 to the second quarter of 2005, based on Realtor-closed transactions from local Realtor boards/associations within the MSAs. The second chart compares the volume of existing condo sales and median sales prices in second quarter 2006 to second quarter 2005, based on Realtor-closed transactions from local Realtor boards/associations within the MSAs.

2006 State of the Market Report

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2006 State of the Market Report

The real estate market is much like a finely tuned jet airplane. To fly at optimal speed and efficiency, the pilot sets the course at optimal altitude, which provides for greatest speed and least resistance. The SW Florida real estate market flew at high altitude from 2001-2003. In 2004, the jet airplane transformed itself into a space shuttle and left the earth’s atmosphere. For two years the shuttle flew at super sonic speed, at altitudes never experienced before.2005 was a year where nothing could stop the shuttle. It was flying faster than the engineers said it could, and seemed unstoppable; until the oxygen sprung a leak. Suddenly, the shuttle was forced to return to earth as there wasn’t enough oxygen to sustain this altitude. Like all re-entries, it can be bumpy and chaotic. The 4th Quarter of 2005 wasn’t bumpy or chaotic. It was as if the world had stopped, and we were flying in slow motion. Speed and altitude dropped quickly. Once the shuttle emerged on radar, it didn’t fly like a loud and confident jet airplane. It felt more like a hot air balloon, drifting slowly, silent and quiet, awaiting word on its future course from the tower. The tower didn’t answer. The flight became choppy in the 1st Quarter of 2006 when everyone realized we were back to flying at earthly speeds and altitude. Sellers began to grasp the gravity of the situation, and made adjustments.

The final altitude has not been set. Once our market finds its optimal altitude, it will once again be in balance. Once our market reaches balance, it will again rise, fly at great speeds and take us all to new heights. No one can say for certain what the correct altitude for this market is, or exactly when we will reach it. One thing we can say with certainty is that the market is balancing itself right before our eyes, and quickly. We are starting to see activity pick up again, either from pent-up demand or price corrections, or both. Once the plane levels we believe we’ll be in for another long and smooth ride. This plane will never land.

Download the full State of the Market Report

 

Florida Homestead Exemption Due Soon

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If you purchased a home in Florida in 2005, you’ll want to file for the Florida Homestead Exemption. Not only will you save approximately $400/yr in taxes, you’ll also cap the amount your taxes can go up each year. If you do not file, there is no cap.To be eligible you must have purchased the home by December 31, 2005 and use the home as your primamry residence. Lee County Florida has a Homestead Exemption Form you can download. Florida is very strict about the property being your primary residence, and they will prosecute you if you cheat. Lee County hires investigators who search for rental listings on the Internet, etc. They even invite the public to tell if they suspect a neighbor is cheating on the exemption, so you only want to fill out this form if you really qualify.

If you purchased in 2006, you’ll have to wait until next year to file. If you purchased prior to 2005 and have not filed yet, you still can. If you qulaify, it’s a wise decision to file. Do not wait as it can cost you much more than the $400/yr because you won’t get the cap.

Florida has two bills pending in the legislature regarding Homestead Exemption Portability. We’ll cover what these bills mean to you in a future post.