Naples Real Estate Market Update - Home Sales Improving?
During the month of October the number of homes sold in the Naples real estate market was 144. In the previous month 178 homes were sold, which is a dip of about 20%. In October 2005 there were 240 homes sold. The difference between 2006 and 2005 is about 40% less home being sold. On the surface this could be viewed as a continuing downward trend. However the pending sales (agreed upon sales contracts) in October of this year showed a total of 168 homes, which is a positive sign of possible increase in market activity.
The median price of a single family home in October 2006, was $392,500. The previous month reflected a median price of $418,000. And in October 2005, the median price was $486,250. In looking at the median list price of the pending sales for October 2006 shows $438,950, which is a positive sign of a potential turn around in the short term.
The average price of a home purchased in the Naples area for October 2006 was $749,096. Closer examination of closed sales revealed that one home sold had a closed sales price in excess of $11,000,000. The impact of this one transaction significantly increased the average price upwards. It did not significantly affect the median price paid. The average price for September ‘06 was $648,953 and in October 2005 - $746,453.
The average days on market (list date to accepted contract date) for October 2006 was 115 days, September 2006 - 102 days and October 2005 - 62 days.
The Naples single home real estate market still continues to be weak, but there are signs are this time of a modest strengthening taking place.
From a seller’s viewpoint there is still remains significant competition, so that pricing is still a critical issue in order to get a property sold.
From a buyer’s viewpoint the abundant number of homes offers an excellent selection at better pricing than last year and definitely more negotiating room.
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2 Responses to “Naples Real Estate Market Update - Home Sales Improving?”
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I totally agree with you Glenn. The greater Naples market seems to be in a bit of a Mexican stand-off, with sellers living in 2005 (as far as pricing goes) and buyers rather ambivalent about whether to pull the trigger or wait for the market to go lower.
Although I do not subscribe to their theory, there are naysayers within our industry, who believe that the market will drop another 10%.
It might be a “Mexican stand-off”, but sellers need to look at what comparable properties are selling for within a three-month and look closely at pending sales.
I agree that some sellers are stuck in 2005, however, the prices paid are higher than 2004, but lower than 2005.
In honestly, there are still some very well priced properties on the market.
Part of the issue in the Naples area, has been the negative press that Naples is over-valued. In the analysis done the author seems to compare prices to the financial demographics. I always ask the same question - if someone lives else and Naples is not their primary residence, where does their financial demographics in the analysis end up? Is any of the financial demographics allocated to the Naples area? Or is all the income associated with their primary residence?
Ultimately, the area’s population will continue to grow, just maybe a little slower than the past 2 years. As buyers re-enter the market, prices will increase at probably the historical annual price increases - and not like the past couple of years.