Metas
Naples Condos Absorption Rate
The number of months of inventory for Naples condominiums for sale has been significantly reduced since February 2008. Using the four time frames of 12, 9, 6 and 3 month moving averages. The 12 month moving average in February was calculated to be 37 months of Naples condos for sale. As of the end of June the calculation was 32 months or a reduction of 5 months. The 9 month moving average shows a reduction of 14 months, while the 6 month moving average shows a reduction of 20 months. The 3 month average shows a reduction in the months of Naples condos for sale of 16 months. At the end of June, there was a slight up tick of one month from May.
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The downward progression for the four moving averages reflects the volume of Naples condos sold or pending sale increasing (reduction of condos for sale) as well as the reducing volume of new condo listings coming on the market.
An absorption rate is defined in the glossary for real estate terms and defintions.
Buyers should be aware of the number of months of condominiums for sale in the Naples area to determine how the market is under going subtle changes and the reduction of the more select residences on the market for sale.
Sellers likewise should be mindful of the absorption rate, as they might want to determine the specific absorption rate for homes or condominiums on the market within their price range to reduce the number of days on market for their properties.
Absorption Rate for Naples Homes
The absorption rate for Naples homes reflects an improving market for the 4 specific time frames - 3 months, 6 months, 9 months and 12 twelve months ending June 30, 2008 for active listings as of July 1, 2008.
The 3 month time frame reflects an inventory of 22 months significantly down from the 44 months in February, and down from 25 months for May.
The 6 month time frame reflects an inventory of 28 months down from February’s 45 months and May’s 33 months.
The 9 month time frame reflects an inventory of 31 months down from February’s 41 months and May’s 34 months.
The 12 month time frame shows 31 months of inventory, down from 38 months in February and 33 months in May.
Each time frame has unique characteristics affecting the number of months. The 12 month time frame includes about 1.5 months of liberal loan programs and sub-prime borrowing, as well as, the subsequent credit crisis where homes under contract (pending sales) did not close due to the elimination of loan programs, mortgage companies failing, and last minute reversal of mortgage commitments by some lenders in the months following August 15, 2007.
The 9 month time frame is affected by the aforementioned last minute reversal of mortgage commitments and issues of possible homebuyers trying to find alternate financing. In addition, it includes the activity during the winter season.
The 6 month time frame includes 3 months of seasonal activity and 3 months of non-seasonal activity.
Overall, when looking at the trend lines they reflect an improving market by their alignment with the 3 month trend line showing the lowest number of months of inventory up to the 12 month trend line showing the highest number of months. If the real estate market was not improving the various trend lines would not be falling in the order shown. The Naples real estate market for single family homes still remains a stronger buyers’ market.
A Friend in Need - Helping Other People
Yesterday, I was informed of a very close and dear friend, Charles Richey, had been hospitalized with Guillain-Barre Syndrome. This particular disease afflicts the nervous system and the inflicted individual looses the use of all their limbs and ability to swallow.
Charles has helped me with my website on many occasions and has always been there to just to talk or give me encouragement when things were rough for me. There are many real estate agents through the United States that have benefited from his assistance. In addition, Charles, is very active in the Las Vegas area with animal rescue organizations. Many times when we talk he will tell me about a new dog that he has staying with him until a home can be found.
Charles does not have any health insurance at this time and with the overall real estate market not as strong as it has been, he will be incurring substantial hospital, physician, and after inpatient care - if you have been hospitalized you may have some idea of what Charles will be facing in the future.
On the Internet, we meet many people and may not meet them in person. So when a call goes out to help another- the internet is a power vehicle to get the word out. I have been lucky to meet Charles and his wife Jacqui in person and have had dinner with them.
You may not know Charles Richey from Las Vegas, but perhaps you know someone that has been striken with this disease and can offer comforting words of advice for this family or if you are so inclined to assist Charles you can visit this site or click on the graphic below.
Donate to the Charles Richey Fund
Thank you for reading this post and any assistance you can offer Charles Richey from Las Vegas.
Naples Condo Market Conditions March 08
Market conditions and trends are important for both condominium buyers and sellers in determining their actions in the Naples real estate market, as well as, cyclical variations. The market conditions for Naples condominiums cover both the month of March 2008 and the first calendar quarter of 2008, ending March 31, 2008. The monthly analysis reflects activity during March with comparative data for the previous years of 2007 and 2006. The quarterly analysis covers the first three calendar months of 2008, therefore, giving a more comprehensive picture of the current market conditions and trends.
MARCH ANALYSIS
NEW LISTINGS:
New listings during the month of March 2008 totaled 664 condo units. In 2007 the total number of units is 856 and in 2006 the total number was 1067. The number of new listings for condos is lower than in the previous March’s shows a positive sign in the real estate market conditions. The affect of less condo listings enter the market will eventually cause the available inventory of condominiums to start to shrink. This can be seen by looking at the absorption rate based upon the current closed sales versus new listings, which equates to 3.2 months.
PENDING SALES:
The pending sales in March were 292 units, which exceeded the March 2007 number of 287 units and the March 2006 figure of 251 units. The March pending sales of 292 units is the highest monthly number since August 2005, where the pending sales were 325.
CLOSED SALES:
During March 207 condo units were closed. Lower than March 2007’s 217 and 2006’s 214 the decrease in volume is not significant. The number of closed sales is being affected by lenders using stricter guidelines in addition to the time to respond to possible short sale sales contracts. Looking back at the months of January and February the number of pending sales totaled 358 condominiums. Most real estate transactions from date the property goes under contract or pending, the transaction closes between 30 and 60 days with an average of 45 days, so the number of closed sales appears to be fairly good.
MEDIAN SOLD PRICE:
The median price of a Naples condo sold in March was $279500 versus $310000 in March 2007 and $366500 in March 2006. The price reduction between 2008 and 2007 is 9.8%, while it is 23.7% between 2008 and 2006.
INVENTORY:
Currently there are about 5586 condominium units on the market for sale; a slight increase over February’s 5582 units. The months of inventory for sale are about 36 months versus 37 months in February. This is another positive sign of the condominium real estate market changing.
QUARTERLY ANALYSIS
NEW LISTINGS:
During the first quarter of 2008 a total of 2401 condos were listed for sale. This compares very favorably to the 3087 condominiums placed on the market during the first quarter of 2007 and extremely favorably to the 3565 units in 2006. In addition the first quarter of 2008 had less new listings than the second and fourth quarters of 2006. Based upon the quarterly closed sales and new listings the absorption rate is 4.8 months.
CLOSED SALES:
During the first quarter of 2008 a total of 505 condominiums were sold, while 482 condos sold in 2007 and 595 in 2006. Other than the second quarter of 2007 the volume of closed has been the highest since the second quarter of 2006.
MEDIAN SOLD PRICE:
During the first quarter of 2008 the median price paid for a Naples condominium was $300000 versus $325000 in the first quarter of 2007 and $377500 in the first quarter of 2006. The price decline as a percentage is 7.7% between 2008 and 2007, while between 2008 and 2006 the percentage is 20.5%. The median price for the most current three quarters has been increasing from $275000 in the 2007 third quarter and $290000 in the fourth quarter. Three straight quarters of the median price increasing maybe a sign that the prices are bottoming out or have bottomed out and should be watched especially by buyers as well as sellers.
If you have any questions please do not hesitate to either post them as a comment or e-mail me.
Naples Home Market Conditions March 2008
The market conditions for Naples covers both the month of March 2008 and the first calendar quarter of 2008, ending March 31, 2008. A monthly analysis reflects activity during a month with comparative data for the previous years of 2007 and 2006. The quarterly analysis covers a longer period of time, therefore, giving a more comprehensive picture of the current market conditions and trends. Trends are important for both buyers and sellers in determining their actions in the Naples real estate market, as well as, cyclical variations.
MARCH ANALYSIS
NEW LISTINGS:
During the month of March a total of 698 homes were listed for sale. The 698 homes listed were lower than March 2007 and 2006, where the total homes listed were 959 and 1100 respectively. The number of home listed in March, other than December 2007 (670), is the lowest volume of new listings since October 2005. The effect of less listings coming on the market is starting to be reflected in the total number of homes available for sale as March is showing 6016 versus 6186 homes in February. Although a slight decline, it is a positive sign for market improvement.
PENDING SALES:
The number of homes where purchase contracts were negotiated was 308. During March 2007 a total of 274 homes were pending sale – March 2008 was an increase of 34 homes or a 12.4% increase. In March 2006 the pending sales totaled 347 homes. The 308 pending sales for March represent the highest number of pending sales since March 2006 where 347 were under contract. One has to go back to August 2005 (323) to find a higher volume of pending sales.
CLOSED SALES:
During the month of March 169 were sold versus 213 in 2007 and 302 in 2006. To the casual observer the number of closings during March may not appear optimistic, however, there are some factors which must be considered – lenders have much stricter underwriting guidelines, fewer liberal loan programs, and the length of time needed to obtain lender approval for possible short sales.
MEDIAN SOLD PRICE:
In the month of March the median price paid a Naples home was $365000. In 2007 the median price was $495000 and in 2006 $489101. The median has declined approximately 26.3% between 2008 and 2007, while from 2006 it is a decline of 25.4%.
INVENTORY:
As stated earlier, there are 6016 homes currently on market which represents about 37 months of inventory to be sold.
QUARTERLY ANALYSIS
NEW LISTINGS:
The number of homes listed during the first quarter of 2007 totaled 2834 while the first quarter of 2007 was 3369 and 2006 was 3576. If one were look at the trend for the previous 3 calendar quarters, it would show an increasing trend line, but it needs to be looked at more critical since the month of January is the highest month for listings.
CLOSED SALES:
In the first calendar quarter of 2008 a total of 437 homes were closed. The closed sales were lower than 2007 with 500 closed sales and 2006 with 688. The implications of lenders’ actions are reflected within the lower volume of closed sales. The closed sales for the first quarter of 2008 are the second lowest starting with the second quarter of 2005. The lowest volume of 406 was during the fourth quarter of 2007.
MEDIAN SOLD PRICE:
The median sold price for a home in Naples during the first quarter was $400000 versus the median prices of $499500 in 2007 and $499275 in 2006. The decline in the median price is about 20% from the previous two first quarters. The median price paid trend line over the immediate five calendar quarters shows a decline, however, the most recent three quarters shows only a 4.4% decline. This could a sign of the market approaching or at the bottom. One does not truly know the bottom of the market until after it passes.
In summary, the real estate market is showing some positive signs where the new listings are decreasing, pending sales are increasing, and median prices are relatively stable over the past three quarters. The negative signs are the lower volume of closed sales and the number of months of inventory for homes for sale.
If you have any questions please do not hesitate to either post them as a comment or e-mail me.
Naples Condo Market Update February 08
The February Naples condo market update reflects signs of the market strengthening as less condos are coming on the market, and pending sales increased over 2007 and 2006. These are subtle signs of changes taking place in the market and does bear watching by those thinking about purchasing a condominium residence.
New Listings: During February 2008 a total of 689 Naples condos came on the market. This was a decrease from of 163 (19.1%) from the same period of last year where 852 condos were listed for sale. February listings reflected a decrease of 445 (39.2%) units from February 2006 listings of 1,134. The reduction of the number of new listings coming on the market represents a strengthening of the Naples condominium market, as fewer units are coming on the market, which will eventually reflect an overall reduction in condominiums for sale. The absorption rate for new listings in February equates to 5.5 months. The 5.5 months represents a reduction from 5.8 months in 2007 and 7.0 months in 2006. For those considering purchasing a condominium, they should step-up their search to focus on the neighborhoods or communities they desire to purchase in.
Pending Sales: During the month of February 257 condominiums in Naples had accepted offers to purchase. The volume of pending sales is greater than the 232 in 2007 and 236 in 2006. This does represent a greater buyer interest in the Naples condo market, as values are being seen in the market and buyer confidence returning. Pending sales over a period of 30 to 60 days become closed sales – expect to see an increase of closed sales in future months.
Median Sold Price: The median price paid for a condo in Naples was $312,000 which is a decrease of 10.9% in February 2007 and cumulative decrease of 17.9% since 2006. The decrease in the median price reflects the higher number of pending sales as more buyers are finding values in the Naples market.
Closed sales: The number of closed Naples condos in February were 125, versus 147 and 161 in the same month of 2007 and 2006, respectively. The reduction of liberal loan programs starting in August 2007, could be reflected by the lower closed sales for this February.
The number of months of Naples condos currently for sale numbers approximately 5,582 units or about 37 months of inventory.
Naples Home Market Update February 08
Some positive signs are continuing to show in the Naples single family home market, but it still remains a buyer’s market. Through out the month March additional commentary, neighborhood or community specific will be posted to better inform both buyers and sellers.
New Listings: In the month of February a total of 887 Naples homes were listed for sale, which down from February 2007 new listings of 993 and February 2006 figure of 1137. The absorption rate of new listings for the February listings is 8.3 months which higher than in previous February’s rates of 6.8 and 6.2 in 2007 and 2006, respectively. The new listings with the lower volume, represents the situation where as less homes on the market the greater the reduction in the number of months of existing inventory of homes for sale. Generally an absorption rate of 6.0 months represents a balanced market between both buyers and sellers of real estate. The new listings for January were 1,127 homes and in December 629.
Pending Sales: During February 2008, 231 Naples homes had offers that were accepted, therefore they are pended sales. Pending sales represents the future closed sales. Pending sales generally close between 30 and 60 days after a contract has been agreed upon. The 231 homes pending sale, is an improvement over 2007 when 219 homes were pending sale. In 2006, the figure was 292. The improvement over 2007 is positive as the number of liberal loan programs available in 2008 are less than in 2007. February pending sales represents the first month in the most recent three months where pending sales have actually shown an increase in absolute numbers. The pending sales in January was 195 and in December 146.
Median Price Paid: The median price for a Naples home in February was $425,000. In 2007 the median price was $445,000 and in 2006 the price was $465,000. Year over year decrease in price was 4.5%. Cumulative price decrease since 2006 is 8.6%.
Closed Sales: The number of closed sales in February 2008 for Naples homes was 107, down from the previous year’s 147 and 2006’s 182.
The inventory of homes presently for sale is 6,186, which represents 38 months of inventory available.
The Naples real estate market still remains a buyers market for selection and price. If the new listings continues to decrease from previous years and pending sales continue to increase over previous years, then the market may have reached the bottom in terms of volumes. The bottom of the market for prices, may have not been achieved at this time, as the inventory of home for sales continues at high level.
Blog Makes Top 100 Real Estate Blogs
Today, I was very surprised to find this blog to ranked in the Top 100 Real Estate Blogs as per Top 100 Real Estate Blogs.
The ranking is determined by Google Page Rank, Technorati Rank, and Alexa rankings.
The blog is entitled Naples Real Estate News and Market Updates and does cover the communities of Bonita Springs and Estero as well.
Thank you - Top 100 Real Estate Blogs.
Naples Home Market Conditions January 08
The Naples single family home market conditions is continuing to show a trend of less listings coming on the market in January 2008. Pending sales are also showing an improvement in the number of homes having offers which are being accepted by the sellers. The number of closed sales were down from previous years as well as the median price which was down 7.9% in comparison to last January.
New Listings - during the month of January 2008, a total of 1,127 single family homes in Naples were listed for sale, up from the 629 listings in December. This compares favorably with 1,411 listings in January 2006, and 1,340 listings in January 2005. Traditionally, the month of January has the highest number of new listings. As the number of new listings coming on the market reduces, the inventory of homes will decrease through sales or sellers deciding to remove their houses from the market.
Closed Sales - the volume of closed sales for Naples homes in January 2008 totaled 111, down from December’s 143. This is slightly less than the 140 homes sold in January 2007 and the 204 homes in January 2005. Although the number of closed is less than 2007, the impact of the elimination of sub-prime borrowers purchasing homes in 2007 is not being reflected in this analysis. The national average for sub-prime borrowers is about 16%, so the decrease in closings may not be as significant as the number reflect. January closings are usually one of the lowest of year.
Pending Sales - for the month of January came in at 195 homes for Naples, up from 146 pending sales in December. In 2007 and 2006, the pending sales were 220 and 244, respectively.
Median Purchase Price - the median price paid for a Naples home was $450,000 in January, which is up (7.9%) from December’s median price of $417,000. The median prices paid in 2007 and 2006 were $584,500 and $580,000, respectively.
Naples Condo Market Report December 07
In the Naples real estate market condominiums show some positive trends in new listings coming on the market, closed sales, and pending sales as one reviews the statistics and analysis, with exception of median price paid. The market report covers not only the month of December, but also for the quarter ended December 31, 2007 and 2007 in totality.
Monthly Analysis:
Listings:
The number of new condo listings coming on the market in December was 535. In December 2006 the number was 683 or a reduction of 22% in volume. In December 2005, new listings were 720 condos or a reduction of about 26%. This represents a positive sign as fewer condos are coming on the market and should eventually be reflected in the gross number of available condos for sale.
The number of months of condo resale inventory is 34 months.
Closed Sales:
The number of closed sales for condominiums in the Naples area in December was 118 versus 140 in December 2006 or a volume reduction of about 16%. Considering the tighter requirements for mortgages and the elimination of sub-prime borrower programs, this is positive for the market. When looking at December 2005, the closed sales totaled 186, a reduction in closed sales volume of 37%. December 2005 many of the sub-prime and liberal loans were available. As many of us are aware the market started to change in the fourth quarter of 2005.
Pending Sales:
A total of 125 condos in the Naples area were pending sale as of the end of December. In December 2006, 120 condos were pending sale as of month end. While in 2005 there were a total of 193. With pending sales we can see the trend or impact of the elimination of liberal underwriting requirements and sub-prime borrower programs, when comparing pending sales between 2005 and 2007. It is interesting to notice that 2007 pending sales for condos are slightly over 2006.
Median Price Paid:
The median price paid for a condo in the Naples for the month of December 2007 was $285,250. The median price paid was $326,000 in December 2006, which represents approximately 12.5% reduction in the median price. The median price paid in 2005 was $406,425. The reduction in whole dollars was $121,175 or roughly 30%.
For the year over year December analysis one can conclude that the real estate market for condominium median prices are declining, while other aspects reflect buyer optimism.
Quarterly Analysis:
Listings:
During the 4th quarter ending December 31, 2007, the total number of new listings was 2,068 versus 2,630 in 2006 and 2,084 in 2005. The reduction in the new listings for the 4th quarter versus 2006 and 2005 could be a sign of the market’s eventual strengthening. With less condominiums coming on the market, the median price paid could in the future could stabilize or trend upwards slightly.
Closed Sales:
A total of 339 condos were sold in the 4th quarter of 2007 versus 354 in 2006 and 583 in 2005. The reduction of 15 condos between 2007 and 2006 equates to about 4%. While between 2007 and 2005 the reduction of 244 or 42% is substantial.
Median Price:
The median price paid for a condo in the Naples area during the 4th quarter of 2007 was $285,500. The median price paid in 2006 was $317,500 and $382,000 in 2005. The median price reduction between 2007 and 2006 was about 10%. However, the reduction between 2007 and 2005 was approximately 25%.
2007 Year Analysis:
Listings:
In 2007 there were a total of 8,836 new listings to come on the market for sale. In 2006, the total was 10,630 and 7,150 in 2005. The new listings in 2007 were less than 2006 and could represent a stabilization or reduction of new listings for condos coming on the market in the future.
Closed Sales:
During 2007, 1,820 Naples condos were sold compared to 1,967 homes in 2006 and 4,293 in 2005. The reduction in the total number of condos sold in 2007 compared to 2006 was 147 condos. This could suggest that the mortgage crisis did not affect the condo market as much as the single family home market as well as buyer confidence in the condo market due to the reduction in median prices paid for a condo.
Median Price:
The median price paid for a condo in Naples in 2007 was $305,000 versus $355,000 in 2006 or a percentage reduction in value of 14%. The median price was $360,000 in 2005. The reduction in value between 2007 and 2005 was about 15%.
What is very interesting to note is that the median price paid for a condo in Naples during 2004 was $241,000. The big question is the prices going to continue to decline? Be sure to read my post on the 2008 real estate forecast from Florida economist, Hank Fishkind.
This post has been enhanced with comparative global information for the Florida real estate market.