Tag Archives: Naples Florida

Good News For Local Jobs

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All news is relative.  Building permits are up which is good for construction and jobs. While building permits are up from last year, they’re a shell of what they were in the building boom, so you can spin the data any which way you want and we’ve seen it spun both ways recently. Good news for local jobs.

Good News For Local Jobs SW Florida Leading Economic Indicators
April Leading Economic Indicators

For years we’ve talked about statistics and provided updates about what’s going on in the local SW Florida real estate market.  Prices go up, prices go down, sales go up, sales go down, etc.  All along we’ve said supply and demand will affect the market, but ultimately the real rebound will occur when the economy improves and jobs return to the area.

Well, we’ve got some actual good news to report, and while some may spin it and say jobs are not what they used to be back in 2005, I would argue this is good news no matter how you look at it.  Nationally, jobless claims rose to 380,000 which was an increase, and this doesn’t even count those who have given up seeking a job, or whom are under-employed.

Locally it’s a much better story.  Two recent stories in the press touted jobs coming to SW Florida.  You may have heard about a company called Arthrex that is building a $25 million manufacturing plant in Collier County.  That will bring construction jobs to the area, but that’s just the beginning. According to a News Press article, the company employs 347 Lee County residents between its Plantation Rd complex and it’s North Naples facility.  The company plans to add another 400-500 workers by 2016 with an average salary at its Collier facility running $59,580. Arthrex expects to have about 2,000 local workers by 2016

I spoke to Government leaders back in January and other projects like this are in the works, so we look forward to bringing more good news to our area in the future.  Another local company made news this past week.  CarMax announced it is hiring for about 80 positions at its news store on Colonial Blvd.  CarMax is a retailer for used cars and a welcome addition to the SW Florida employment pool. By the way, if you’d like to apply for a job, visit www.carmax.com/careers

The real estate market has definitely been on the upswing since 2009.  For any recovery to be sustainable, jobs have to enter the picture, and now that is happening.  As inventory dwindles and more jobs come to the area, there is the potential for more construction opportunities, which fuels more jobs.  SW Florida has always been home to service industry jobs and construction, and with the addition of manufacturing companies like Arthrex, it could be a boom to our local economy.

There is talk of adding convention center space and perhaps a casino in the Fort Myers area which would also be a boom to the area job wise.  Gambling has always been a hotly debated topic and will always have opinions on both sides of the fence.  We’ll keep our eye on this however we suspect it will take months for this decision to play out.

SW Florida Distresses Sales Versus Traditional Sales
Traditional Sales Bring More Money Than Foreclsoures

Foreclosures are down which is another reason prices are up.  If you look at the attached chart you’ll see the median price of a traditional sale in Lee County Florida is almost double the foreclosure price.  This is a function of which homes come on the market in a particular price range, but I think it’s safe to assume that traditional sales are more indicative of actual market values than distressed sales. The good news is, there were almost 600 more traditional single family home sales the 1st qtr of 2012 than there were in 2011.

Let’s keep the Good News coming! It’s hard to spin this data as anything but good.

 

 

Naples Florida Most Overpriced Market in US

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Naples Florida is the most overpriced market in the US according to National City Mortgage.  I found this article in Money Magazine, which covers most major markets across the country.

What’s their forecast for the rest of SW Florida real estate?  They predict Cape Coral – Fort Myers homes to appreciate 9.3% from June 2006 to June 2007.  This is in line with what the Ellis Team has been predicting.  Statistically we think the market has hit bottom and now is the time for buyers to buy in earnest as their is good selection and still relatively low interest rates.

SW Florida Real Estate Update

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SW Florida real estate has on average bottomed out.  That’s not to say there won’t be tough times in isolated areas, but overall prices have steadied for the past three months and buyer activity has really picked up in the last two weeks.

Buyers will look back and say they should have bought in April  or May of 2006 as inventory levels were excellent for the buyers and mortgage rates were at their lowest.  Prices have also come down around $40,000-50,000 since their highs in some market price ranges.

We’ve had pent-up demand from buyers who have been afraid to buy because they thought if they just waited a month or two, prices would be lower in the future, and they would have been correct up until now.  We’ve seen prices level out.  Buyers need re-assurance that it’s OK to buy, and they haven’t had that.  This changed about two weeks ago as buyers started buying again.  When the word gets out to other buyers, they’ll all turn on, like fire ants.  Fire ants seem to bite all at once.  They’re there, everybody knows they’re there, and when the decide to bite everybody will know they’re biting.  The same is true with buyers of real estate.

Fort Myers real estate is rebounding nicely, followed by Cape Coral and Naples.  Naples probably had the furthest to fall as it was the most ahead of itself.  Cape Coral still has loads of inventory, and that will take time to work itself through.

Thye wild card is rising interest rates and rising insurance costs.  If insurance costs goes up $100/mo it reduces the buying power of a buyer by about $16,000.  Rising interest rates, insurance, and property taxes all work the same way, and could limit the price increases we’ll see down the road.

The good news is overall the market has stabilized and is near bottom.  Expect the market to level where it is while buyers eat up inventory, and eventually rise about 5% per year once inventory levels have come down.

Home appreciation could have been in the 7-9% range and may be limited by rising home ownership costs described above.  It’s possible the market will just stay level the rest of the year and not appreciate too much as we work through this inventory.  Buyers should buy now though because rates are expected to rise throughout the year, and waiting may increase the payments.

Just a quarter percent rise in rates costs the buyer several thousands of dolalrs in buying power.  For these reasons, this is why I say that buyers will look back on May 2006 as the best time to have bought real estate in SW Florida