Price Climb Slows as Inventory Heats Up for Summer

Naples, Fl (June 28, 2024) – As competition grows in the Naples housing market – overall inventory increased 67.1 percent in May to 5,019 properties from 3,004 properties in May 2023 – monthly closed sales for the month decreased 12.2 percent to 907 closed sales from 1,033 closed sales in May 2023. Broker analysts reviewing the May 2024 Market Report by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island), are closely monitoring the number of monthly price decreases to see whether it could turn the tide and improve sales this summer. One thing was certain in the May Market Report: summer buyers will have many more options than winter buyers.

New listings during May increased 18.4 percent to 1,201 new listings from 1,014 new listings in May 2023. “There were more price decreases than new listings in May,” Jeff Jones, pointed out. “Price reductions are good for our market. It tells us that sellers are finally realizing the market today won’t support aspirational pricing.”

In addition to 1,710 price decreases reported in May, the median closed price was $650,000, the same as the median closed price reported in April, which enjoyed 2,365 price decreases. Comparatively, the median closed price increased 8.3 percent to $650,000 from $600,000 in May 2023.

“The list price decreases are a signal that we are moving toward pricing that reflects today’s home values,” said Molly Lane who added, “This also indicates to us that local REALTORS® are doing a great amount of market research and using good salesmanship to get their sellers over the finish line.”

Another benefit of rising inventory and list price decreases has been the rise in the number of properties for sale in the lower end of the market. For May, properties in the $300,000 and below price category increased 104 percent to 308 from 151 in May 2023. Similarly, properties for sale in the $300,000 to $500,000 price category increased 90.1 percent to 1,032 from 543 in May 2023. 

Qualifying Obstacles

Brokers, including Wes Kunkle, recognize the many challenges facing home buyers today. In addition to record-high home prices, which have increased 83 percent (month/month) since 2019, Kunkle said “buyers are having a difficult time qualifying for loans. The demand is out there, it’s just that many people are either not able to come up with the down payment or realize the burden of additional high-item expenses like homeowners insurance and association fees prohibit them from purchasing a home.”

Mike Bone agreed with Kunkle, “About 40 percent of the buyers we see at our new home developments in Southwest Florida are unable to qualify for loans. Even with rate buydown programs and cash incentives, we are seeing enormous financing challenges.”

The NABOR® May 2024 Market Report provides comparisons of single-family home and condominium sales (via the Southwest Florida MLS), price ranges, and geographic segmentation and includes an overall market summary. NABOR® sales statistics are presented in chart format, including these overall (single-family and condominium) findings for 2024:

A Different Seller/Buyer Dynamic

Unlike other cities in the U.S. where home sales are driven by people relocating for work, Naples has always been a lifestyle destination. “People live here because they want to. People are not moving here for jobs,” said Kunkle. In response, Mike Hughes added, “That means we have a different mix of sellers and buyer here. A majority of our sales are second homes. That said, these sellers don’t have an urgency to sell or won’t risk someone stealing it. On the other hand, second home buyers don’t have an urgency to buy because they have the time and cash to wait until they find exactly what they want.”

Another challenge for buyers and sellers in Naples during 2024, and across Florida, will be condominium sales. As Jillian Young explained, “By December 31st, the structural integrity reserve law requires all Florida condominiums three stories and higher and 25 to 30 years old have a milestone inspection and use the results to guide them to maintain financial reserves that will pay for future maintenance, inspections and repairs. The burden to raise these funds will require mandatory assessments on current and future owners. Sellers will need to take into account the additional cost to maintain the reserves.”

Geographic Standouts

In May, the median closed price for a single-family home in the Naples Beach area (34102, 34103, 34108) decreased 26.1 percent to $2,262,500 from $3,062,500. Conversely, the median closed price for a single-family home in the South Naples area (34112, 34113) increased 43.6 percent to $930,000 from $647,500. The lowest median closed price reported during May was in the Central Naples (34104, 34105, 34116) condominium market, which increased only 1.4 percent to $355,000 from $350,000 in May 2023.

If you are considering buying or selling your home, look to a Naples REALTOR® who has the ability to provide an accurate market comparison and give you expert advice on how to capitalize on today’s market conditions. A REALTOR® can ensure your next purchase or sale in the Naples area is a success. Search for your dream home and find a Naples REALTOR® on Naplesarea.com.

The Naples Area Board of REALTORS® (NABOR®) is an established organization (Chartered in 1949) whose members have a positive and progressive impact on the Naples community. NABOR® is a local board of REALTORS® and real estate professionals with a legacy of over 60 years serving 8,500 plus members. NABOR® is a member of Florida Realtors® and the National Association of REALTORS®, which is the largest association in the United States with more than 1.4 million members and over 1,200 local boards of REALTORS® nationwide. NABOR® is structured to provide programs and services to its membership through various committees and the NABOR® Board of Directors, all of whose members are non-paid volunteers.

The term REALTOR® is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribe to its strict Code of Ethics.

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