If you are on the looking for a reasonably priced property in Naples real estate market, you can find some great deals. These foreclosed properties are located in some of the best residential areas in Naples and are available at unbelievable prices to what they previously sold for, which makes them an ideal investment option for home or vacation home buyers or those buyers looking for a future retirement home.

Purchasing a foreclosed property in Naples has multiple advantages for prospective buyers. Buyers can now find a property in one of the best residential hot spots in the country at a moderate price (prices sometimes as low as 2001 or 2002).  Listed below are some of the reasons:

•         Known as one of the most sought after residential areas in Florida. Naples at this time offers a wide range of housing choices from family homes to condominiums which are located in excellent communities having top notch amenity facilities.

•         Being one of the most affluent area in the state of Florida as well as in the country, investing in a property will yield home buyers a high return over a period of time as the real estate prices of this area has had a steady appreciating value.

•         Another reason which makes the area an ideal choice for families as well as retired people is the presence of more than 100 golf courses which have been made through-out the Naples area.

Listed below is a guideline to landing a suitable property that will make a great investment for home buyers, both now and in the future:

•         Understand the process of buying a foreclosure is very important which is why buyers should get familiar with the buying of foreclosed homes by consulting a team member of A Delta Realty and real estate attorneys. If you are from outside the area, we can recommend several excellent real estate attorneys in the Naples area.

•         Foreclosed homes are available for 50 percent or more below their prices in 2005 (the high point), while foreclosed condos are available for 55 percent below the 2005 prices. Locating the best deals will take perseverance and being aware the lowest priced property maybe not be the best investment in the long run. One of your best resources is a team member of A Delta Realty.

•         The process of purchasing a foreclosed home or condo requires considerable knowledge and skill, as well as an attorney specializing real estate.

•         Once you have narrowed your search for a property have the property inspected by home inspector and consider a radon gas test, air quality test, and termite or wood destroying organism inspection.

•        Investigate the financial status of any association where the property is located to determine its financial viability. Some property associations are under financial stress, which could cause your great deal to be very costly in the long run.

•         Have the property reviewed for code compliance – some properties are in violation of local codes. If you acquire a property with code violations you will be responsible for the curing the violation which could involve costs to renovate, re-mediate, or payment of fines.

•         Finally, be prepared to act quickly on a property and be mindful not only are you looking for a great deal, but others are looking for a great deal, as well. Remember – “The early bird catches the worm.”

There are a host of benefits that are associated with buying a property through a member of the A Delta Realty Team. When you meet with one of our team members ask for our exclusive FREE whitepaper “What to Watch for When Buying Foreclosed Properties.”

The homes for sale in Naples continue to show signs of improvement. While still a buyer’s market, the homes available for sale increased slightly as well as the months of inventory over the month previous month.

The month of March started with 3890 homes available for sale in the Naples area. Last March 5298 homes were for sale in a year over year comparison it is a decline of 1408 homes available for sale. This represents a decline of about 27 percent. The month of February started with 3814 homes for sale 76 fewer homes than March.

The graph below shows the number of homes for sale in Naples between the years of 2008 thru 2010.

Naples homes for sale at the start of March

The months of inventory, measures the current demand for homes, in addition, if it is a buyer’s or seller’s market. When the months of inventory ranges between 5 and 7 months, it is considered a neutral market – neither buyers nor sellers have control over pricing. When months of inventory are excess of 7 months the buyers control the market as far as pricing. The reverse is true for when the inventory is 5 or fewer months.

The months of inventory at the start of March was 11.2 months compared to start of last March where there were 22.6 months of inventory. The decline in the months of inventory is about 50 percent representing another sign of the real estate market for homes in Naples is continuing to improve.

The graph below shows the movement in the months of inventory for 2008 thru 2010.

Months of inventory for Naples homes for sale

The composition of the homes for sale in Naples (traditional, foreclosures, and potential short sales) is another aspect of evaluating the real estate market. The greater the percentage of traditional sales the more strength within the market place. The percentage of the various types of listings, as noted above, should be reflected throughout the real estate cycle. The real estate cycle is listing, pending sale, and closed sale. When the percentages are inconsistent during the real estate cycle signals issues within a particular type of listing group can be noted and effective decisions made.

Below is a graph reflecting the composition of single family home listings at the start of March.

Composition of Naples homes for sale at the start of March

The condos for sale in Naples continue to show signs of improvement. While still a buyer’s market, the condos available for sale are declining as well as the months of inventory declining.

The month of February started with 4114 condos available for sale in the Naples area. In a year over year comparison it is a decline of 1028 from last February’s 5142. This represents a decline of about 20 percent.

The graph below shows the comparison between the years of 2008 thru 2010.

Naples Condos for Sale - Comparison 2008 thru 2010

The months of inventory, a measure of judging current demand for condominium housing, in addition to if it is a buyer’s or seller’s market. When the months of inventory ranges between 5 and 7 months, it is considered a neutral market – neither buyers nor sellers have control over pricing. When months of inventory are excess of 7 months the buyers control the market as far as pricing. The reverse is true for when the inventory is 5 or fewer months.

The months of inventory at the start of February was 16.1 months compared to start of last February where there were 30.0 months of inventory. The decline in the months of inventory is about 46 percent representing another sign of the real estate market for condos in Naples is continuing to improve.

The graph below shows the movement in the months of inventory for 2008 thru 2010.

Naples Condos for Sale Months of Inventory 2008 to 2010

The composition of the condos for sale in Naples (traditional, foreclosures, and potential short sales) is another aspect of evaluating the real estate market. The greater the percentage of traditional sales the more strength within the market place. The percentage of the various types of listings, as noted above, should be reflected throughout the real estate cycle. The real estate cycle is listing, pending sale, and closed sale. When the percentages are inconsistent during the real estate cycle signals issues within a particular type of listing group can be noted and effective decisions made.

Below is a graph reflecting the composition of listings at the start of February.

Composition of Naples Condos for Sale at the Start of February 2010

The homes for sale in Naples continue to show signs of improvement. While still a buyer’s market, the homes available for sale are declining as well as the months of inventory declining.

The month of February started with 3814 homes available for sale in the Naples area. In a year over year comparison it is a decline of 1538 from last February’s 5352. This represents a decline of about 29 percent.

The graph below shows the comparison between the years of 2008 thru 2010.

Naples Homes for Sale at the start of February

The months of inventory, a measure of judging current demand for housing, in addition to if it is a buyer’s or seller’s market. When the months of inventory ranges between 5 and 7 months, it is considered a neutral market – neither buyers nor sellers have control over pricing. When months of inventory are excess of 7 months the buyers control the market as far as pricing. The reverse is true for when the inventory is 5 or fewer months.

The months of inventory at the start of February was 11.1 months compared to start of last February where there were 23.7 months of inventory. The decline in the months of inventory represents another sign of the real estate market for homes in Naples is continuing to improve.

The graph below shows the movement in the months of inventory for 2008 thru 2010.

Months of Inventory - Naples Homes for Sale

The composition of the homes for sale in Naples (traditional, foreclosures, and potential short sales) is another aspect of evaluating the real estate market. The greater the percentage of traditional sales the more strength within the market place. The percentage of the various types of listings, as noted above, should be reflected throughout the real estate cycle. The real estate cycle is listing, pending sale, and closed sale. When the percentages are inconsistent during the real estate cycle signals issues within a particular type of listing group can be noted and effective decisions made.

Below is a graph reflecting the composition of listings at the start of February.

Composition of Homes for Sale in Naples - February

Tivoli Model in Caldecott Under Construction at Lely Resort

The other day I toured the Caldecott neighborhood of Lely Resort and saw a Tivoli model home under construction. A home which has no specific buyer and being constructed by a builder is called a “spec” home.

It was quite interesting to see a home under construction, although most of the major work had already been completed, there was still finishing work to be done, as well as, finishing of the pool and spa and the addition of the screened dome or pool cage.

The home has about 2723 square feet of air conditioned space and has a wide lake view from the master bedroom, breakfast nook, lanai and pool area.

The real estate market in Naples for single family homes is not as strong a buyer’s market as last year both the number of homes listed for sale and months of inventory is lower than last year. Buyers and sellers need to monitor the months of inventory to determine how favorable or not favorable the market is for them.

As of the first of January there were a total of 3,630 homes for sale. At the start of January 2009 a total of 5,296 homes were listed for sale. This represents a reduction of 1,666 homes or roughly 32 percent.

Below is a graph depicting the change in the number of homes for sale at the end of the month for the immediate past 2 years.

Two year number of Naples homes for sale by month

Another measure of the changing market is the number of inventory available for sale. This year the months of inventory is 10.8 months. Last year the inventory was 24.3 months. This is a reduction of 13.5 months in a year over year analysis. Buyers and sellers should monitor this statistic – months of inventory less than 6 is a seller’s market (demand exceeds supply), while an inventory more than 6 is a buyer’s market (supply exceeds the demand).  A neutral market is 6 months – is when the market is in balance – demand and supply are equal.

Below is a graph showing the months of inventory during the past two years.

Months of inventory by month over the past 2 years.

Another important aspect of Naples homes for sale is the composition of the various types of listings.

Traditional listings are homes for sale which is neither bank owned nor a seller attempting a short sale. This is what typical occurred prior to the real estate bubble bursting.

Foreclosures are homes listed for sale and are bank owned properties.

Short sales are listings where the seller a property owner (seller) is attempting to sell the property and the value of the property is such that when the property is sold, the seller does not have the funds or resources to cover the short fall (difference) between sales price and the amount of the mortgage owed to the lender(s) nor the closing costs associated with the sale. This type of sale requires the approval of all parties holding a lien against the property.

The composition of listings is only one part of the equation in looking at real estate market. The other stages – pending sales and closed – are important to consider in determining the strength or weakness of the local real estate market.

The graph below shows the composition of the percentage of listings according to the type of listing.

Composition of Naples homes for sale

As prospective buyers run towards the purchase of less expensive condominiums in the Naples area – their attention has not been to the financial stability of the association. In other words they are running into condominium complexes that could be facing a financial distress situation. Warnings regarding the apartment to condominium complexes and their potential financial distress situations have taken place over several months, starting with the doubling of quarterly association fees of a North Naples condominium complex. Such a situation has come to light recently in an article found on the Marco Island News on December 7, 2009.

Liens by the homeowners association halted an auction for 55 condominiums at Granada Lakes Villas in eastern Collier County.

An auction advertised for Dec. 6 never happened and interested buyers have been put on hold. Some contracts were signed in the weeks leading up to the public event.

The liens were filed after the auction was heavily advertised.

“We had a lot of properties under contract. We were ready to start closing. This came up,” said Eric Chavarria, a Realtor with Real Estate Empire in Miami, which was handling the auction.

Granada Lakes Villas went from apartments to condos a few years ago but it was a late comer in the conversion craze that hit Southwest Florida back in 2004. Granada Lakes Villas has been plagued by foreclosure actions.

Analysis showed more than 100 default notices filed against owners in the community, which is the first step in foreclosure.

On the developer owned units, the average lien is about $10,000 for unpaid maintenance fees. It’s almost half a million dollars in past dues.

Source: Marco Island News

Naples Florida homes for sale at the beginning of October was 3698 last year. There were 5244 homes for sale in September. This represents a reduction in the total number of homes for sale by 1546 or about 30 percent,. During the month of August. There were a total of 3777 homes for sale. The 3698 available homes for sale represents a decrease of approximately 2%.

The graph below shows shows the active number of listings for the period January 2008 to September 2009.

Naples homes for sale showing 2008 and 2009

The composition by type of listing is shown below in the pie chart.

October composition of homes for sale in the Naples area

The breakdown by type for the above:
Traditional - 2814
Potential short sales - 760.
Foreclosed - 124.

The breakdown by type of potential real estate transaction for August is shown below in the pie chart.

September composition of homes for sale in the Naples area

The breakdown by type for the above:
Traditional 2867.
Potential short sales 773.
Foreclosed 137

A factor, which supports an improvement in the Naples real estate market for single-family homes is the months of inventory. The current months of inventory is slightly below 12 months whereas in August. The months of inventory was likely above 12 months last year the number of months was 27. This represents a reduction in excess of 50 percent.

The line graph below reflects the months of inventory over the period of January 2008 two September 2009.

Months of inventory - homes for sale

During the one of October historically, there is a sick depth against increase in the number of new listings that come on the market. The question is will wield the number of active listings as well as the months of inventory available for sale. Continue to show declines.

Listings:

The new listings for the month of August 2009 were 468 condos in the Naples real estate market. The number of condos listed in August 2008 was 513. The decline of new condo listings coming on the market condos was 9 percent. In August 2007, the new listings were 564, representing a drop of 96 condos or decline of 17 percent.

In July 2009 the new listings were 557.

Of the 468 condos listed approximately 20 percent were potential short sales, 12 percent were foreclosed (bank owned), and the remaining 68 percent were traditional listings.

Median list price for potential short sales was $129000, foreclosed properties were $86200, and traditional listings were $239500.

Closed Sales:

In the month of August 2009 the number of condos sold was 204. In August 2008 a total of 171 condos were sold. The year over year was 19 percent increase. In August 2007 a total of 122 condos were sold. The increase over 2007 was 82 condos or about a 67 percent.

Of the 204 condos sold, approximately 11 percent were approved short sales, 21 percent were foreclosures, and the traditional sales were 68 percent.

A graphic presentation for the composition of the closed sales is shown below.

Composition of sold condos in Naples for August 2009

The breakdowns of the median sold prices are discussed in the median sold price section below.

Pending Sales:

During August 2009 a total of 341 condos had an offer accepted by the seller. In August 2008, 184 condos had offers accepted. The increase from August 2009 represents an increase of 157 condos or about 85 percent.

In August 2007 a total of 110 condos were pending sale. The increase between August 2009 and August 2007 was 231 condos or about 210 percent.

The total number of condos pending sale in the Naples area as of the end of August 2009 was 4095. The graph below reflects the composition of these pending sales.

Composition of Total Pending Sales for Naples

Median Sold Price:

During the month of August 2009, the median sold price of a condo in Naples was $163500. The median price is the sold price represents the middle value of the all sold prices within a stated range. The median sold price can vary from area to area within a local real estate market.

In August 2008, the median sold price was $216000. In the year over year comparison median sold price declined $52500 or roughly 24 percent.

In August 2007 the median sold price was $285000. In comparing August 2007 to August 2008 the price declined $121500 or about 43 percent.

Median sold price for approved short sales was $123900, foreclosed properties were $63600, and traditional listings were $218900.

The difference between the list price and sold price for approved sales was about 81 percent, foreclosed properties 95 percent, and traditional listings 90 percent.

Listings:

The new listings for the month of August 2009 were 608 homes in the Naples real estate market. The number of homes listed in August 2008 was 797. The decrease in the number of new listings of homes was 189 or about 24 percent. In August 2007, the new listings were 950, representing a reduction of 342 homes or a decline of 36 percent compared with August 2009.

In July 2009 the new listings were 728.

Of the 608 homes listed approximately 27 percent were potential short sales, 20 percent were foreclosed (bank owned), and the remaining 53 percent were traditional listings.

Median list price for potential short sales was $165000, foreclosed properties were $119800, and traditional listings were $399000.

Closed Sales:

In the month of August 2009 the total homes sold were 331. In August 2008 a total of 220 homes were sold. The year over year was 51 percent increase. In August 2007 a total of 164 homes were sold. The increase over 2007 was 167 homes sold or about a 102 percent.

In July 2009 the number of homes sold was 400.

Of the 331 homes sold, approximately 18 percent were approved short sales, 39 percent were foreclosures, and the traditional sales were 43 percent.

The pie chart below shows the composition of closed sales in graphical format.

Composition of homes sold in Naples for August 2009

The breakdowns of the median sold prices are discussed in the median sold price section below.

Pending Sales:

During August 2009 a total of 518 homes had an offer accepted by the seller. In August 2008, 274 homes were pended. The increase from August 2009 represents an increase of 244 homes or about 89 percent.

In August 2007 a total of 160 homes were pending sale. The increase between August 2009 and August 2007 was 358 homes or about 224 percent.

The composition of  the August 2009 homes pending for sale in the Naples area is shown below.

Composition for the month of August pending sales

The total number of homes pending sale in the Naples real estate market is 1133. The pie chart below shows the percentage break down.

Composition of Total Pending Sales for Naples

Median Sold Price:

During the month of August 2009, the median sold price of a home in Naples was $185000. The median price is the sold price represents the middle value of the all sold prices within a stated range. The median sold price can vary from area to area within the local Naples real estate market.

In August 2008, the median sold price was $257750. In the year over year comparison the median sold price declined $72750 or roughly 28 percent.

In August 2007 the median sold price was $404000. In comparing March 2007 to March 2008 the price declined $219000 or about 54 percent.

Median sold price for approved short sales was $190000, foreclosed properties were $118000, and traditional listings were $304500.

The difference between the list price and sold price for approved short sales was about 93 percent, foreclosed properties 99 percent, and traditional listings 88 percent.

The condominium market for the Naples real estate area at the start of September 2009 declined down to 4095 units for sale. In the year over year comparison the number of unit declined 580 or about 12 percent from the 4675 condominiums on the market in September 2008.

The September 2009 was also a decline from the August 2009 4248 condominiums on the market. The decline represents a about 3.6 percent reduction.

The graph below shows the inventory of condominiums for sale since January 2008:

Naples condos for sale - September

The composition of various types of possible real estate transactions of the September condos for sale are broken down as follows:
Traditional condos for sale – 3482
Potential short sales – 533
Foreclosed condos – 80

The pie chart below shows the breakdown in a graphical format:

Composition of Naples Condos for Sale - September

In August the breakdown of condos for sale was as follows:
Traditional sales – 3629
Potential short sale – 542
Foreclosed condos – 77

Overall the number of Naples condos for sale declined from the previous month, the composition remained the same with the largest drop in the traditional condos for sale.

The inventory of Naples homes for sale, continues to show a downward trend. As of the midnight July 3 or the early morning hours of August 1, there were a total of 3923 homes for sale in Naples. As of July 1 the number of homes for sale was 4104. Between the two months there was a drop of 181 homes. The difference is more pronounced in comparison with 2008 – a total of 5263. In a year over year comparison the drop equates to 1340 homes or about 26 percent reduction in the number of homes for sale.

The graph below shows the number of homes available for sale for 2008 and 2009. The downward trend is reflected in the graph – market improvement. However, the composition of the Naples homes for sale, but itself does not completely give a true picture of  the real estate market for single family homes.

Naples FL homes for sale graph

The composition of homes for sale is interesting to view. It reflects an interesting view of the potential types of transactions which could evolve into future sales. As of August 1 the composition of 3923 homes for sale – 75 percent are traditional, 21 percent are potential short sale, and 4 percent are foreclosed homes. Over the past four months, although the shifts in the composition of the listings, with potential short sale homes increasing 1 percent – there could be greater facts revealed when looking at the composition of pending sales and closed sales

Composition of Naples Homes for Sale - August

The graph below shows the composition of homes for sale as of July 1. Traditional for sale homes represented 76 percent, potential short sales 21 percent and foreclosures 3 percent. The difference between August and July shows a slight shift from traditional sales to the foreclosure segment.

Composition of Naples Homes for Sale - July

The June composition of 4414 homes for sale, breaks down as follows: traditional sales – 76 percent, potential short sales 20 percent, and foreclosures 4 percent. The only difference between the July composition and June composition is the slight change between foreclosures and potential short sales.

Composition of Naples Homes for Sale - June

The composition of the May, 4756 homes for sale in Naples breaks down as follows: traditional listings 76 percent, potential short sale listings 20 percent and foreclosure listings 4 percent. Essential there is no shift between May and June.

Composition of Naples Homes for Sale - May

The Naples real estate market for condos is starting to show signs of strengthening in many aspects and prospective buyers should be aware of the positive changes. The statistics presented and discussed below are global in nature for the Naples area and do not represent the more important micro-market views which can vary greatly from the global view.

Listings:

During the month of May a total of 536 condos were listed for sale. In May 2008, the number of condos listed for sale in the Naples area was 599. In addition the 536 condos listed for sale was less than the 757 condos in May 2007. The downward trend of new listings is continuing. The volume of listings in January were 990, February with 745, March with 771, and April with 657. Other than October 2008, the listings for May was the lowest number over the past 4 years.

The listed condos in May 2009 was the lowest number of homes listed since October 2005. The noteworthy item about this fact, is that in October 2005, was the start of the real estate erosion even though the median sold price of homes peaked in January 2007 with January 2006 as the next highest median sold price month.

Pending Sales:

During the month of May 2009, a total of 375 condos had offers accepted by sellers (pending). The figure for pending condo sales in May represents a substantial increase over both May 2008 and May 2007 were the pending sales were 217 and 207, respectively. The increase represents 73 percentage upwards change over May 2008 and a 81 percentage increase. The increase in pending sales for May can largely be attributable to the lower median sold prices of condos.

Over the past 9 months the number of pending sales in the Naples area have showing an upward trend from 118 condos pended in September 2008. In addition, the past 3 months have had the highest volume of pended condominiums over the past four years.

Closed Sales:

There were a total of 287 closed (sold) in May 2009. In a year over year analysis, the 287 sales is higher than May 2008 and May 2007, where 223 and 218 sales respectively took place. The sales in May represents a 22 percent increase and 32 percent over May 2007 and May 2008, respectively.

The closed sales in May, represents the highest number of homes sold since September 2005.

Since January 2009, the number of condos sold has been on a strong upward trend. This is the continuous of an upward trend starting in January 2009. The immediate past three months of closed sales is highest since September 2005.

The increase is largely due to the lower median sold price of condos in the Naples area.

Median Sold Price:

The median sold price (the sold price at which half the condos sold and half below) for May 2009 was $167000. This figure may not be good news for existing homeowners or sellers, but it is good news for prospective buyers. However, prospective buyers need to be aware that since January 2009, the median sold price for a condo in Naples has been ranging from $178000 to $167000. Over the past 2 months the median sold price has been showing a slight upward trend.

The median sold price in May represents a 36 percent decline from May 2008 when the median sold price was $262500 and a 45 percent decline from May 2007 when the sold price was $301500.

The lower median sold price has a direct affect on the increased volumes for pending sales and sold condos. The lower volume of new listings could have an eventual impact on the median sold prices, as the volume of new listings coming on the market for condos declines. Can the current statistics represent a stabilization of the Naples condo real estate market or has the bottom of the real estate been realized? Only the national economy and time will tell.

The Naples real estate market for homes is starting to show signs of strengthening in many aspects and prospective buyers should be aware of the positive changes. The statistics presented and discussed below are global in nature for the Naples area and do not represent the more important micro-market views which can vary greatly between the North Naples, Naples West, Naples Central, Naples South, Pelican Bay, Pelican Marsh, The Vineyards and Golden Gate Estates areas.

Listings:

During the month of May a total of 689 homes were listed for sale. In May 2008, the number of homes listed for sale in the Naples area was 840. In addition the 689 homes listed for sale was less than the 852 homes in May 2007. The downward trend of new listings is continuing.

The listed homes in May 2009 was the lowest number of homes listed since October 2005. The noteworthy item about this fact, is that in October 2005, was the start of the real estate erosion even though the median sold price of homes peaked in January 2007 with January 2006 as the next highest median sold price month.

Pending Sales:

During the month of May 2009, a total of 590 homes had offers accepted by sellers (pending). The figure for pending home sales in May represents a substantial increase over both May 2008 and May 2007 were the pending sales were 297 and 206, respectively. The increase represents 108 percentage upwards change over May 2008 and a 186 percentage increase. The increase in pending sales for May can largely be attributable to the lower median sold prices of homes.

Over the past three months the number of pending sales in the Naples area have been higher than in previous years, dating back to at least March 2005, even though the real estate market erosion could be earmarked back to October 2005.

Closed Sales:

There were a total of 419 closed (sold) in May 2009. In a year over year analysis, the 419 sales is higher than May 2008 and May 2007, where 272 and 222 sales respectively took place. The sales in May represents a 54 percent increase and 89 percent over May 2007 and May 2008, respectively.

The closed sales in May, represents the highest number of homes sold since June 2005.

Since January 2009, the number of homes sold has been on a strong upward trend. This is the continous of an upward trend starting in March 2008.

The increase is largely due to the lower median sold price of homes in the Naples area.

Median Sold Price:

The median sold price (the sold price at which half the homes sold and half below) for May 2009 was $185000. This figure may not be good news for existing homeowners or sellers, but it is good news for prospective buyers. However, prospective buyers need to be aware that since November 2008, the median sold price for a home in Naples has been ranging from $204000 to $177,200. Over the past 3 months the median sold price has been showing a slight upward trend.

The median sold price in May represents a 50 percent decline from May 2008 when the median sold price was $370,000 and a 58 percent decline from May 2007 when the sold price was $437500.

The lower median sold price has a direct affect on the increased volumes for pending sales and sold homes. The lower volume of new listings could have an eventual impact on the median sold prices, as the volume of new listings coming on the market for homes declines. Can the current statistics represent a stablization of the Naples home real estate market or has the bottom of the real estate been realized? Only the national economy and time will tell.

Listings:

The new listings for the month of March 2009 were 749 condos in the Naples area. The number of condos listed in March 2008 was 721. The increase of new listings of condos was 4 percent. In March 2007, the new listings were 861, representing a drop of 112 condos or decline of 13 percent.

In February 2009 the new listings were 710.

Of the 749 condos listed approximately 18 percent were potential short sales, 11 percent were foreclosed (bank owned), and the remaining 71 percent were traditional listings.

Median list price for potential short sales was $154900, foreclosed properties were $76000, and traditional listings were $275750.

Closed Sales:

In the month of March 2009 the sale of condos were 248. In March 2008 a total of 222 condos were sold. The year over year was 12 percent increase. In March 2007 a total of 217 condos were sold. The increase over 2007 was 31 condos or about a 14 percent.

Of the 248 condos sold, approximately 5 percent were approved short sales, 16 percent were foreclosures, and the traditional sales were 79 percent.

The breakdowns of the median sold prices are discussed in the median sold price section below.

Pending Sales:

During March 2009 a total of 413 condos had an offer accepted by the seller. In March 2008, 280 condos were pended. The increase from March 2009 represents an increase of 133 condos or about 48 percent.

In March 2007 a total of 207 condos were pending sale. The increase between March 2009 and March 2007 was 206 condos or about 100 percent.

Median Sold Price:

During the month of March 2009, the median sold price of a condo in Naples was $169000. The median price is the sold price represents the middle value of the all sold prices within a stated range. The median sold price can vary from area to area within a local real estate market.

In March 2008, the median sold price was $276250. In the year over year comparison median sold price declined $107250 or roughly 39 percent.

In March 2007 the median sold price was $310000. In comparing March 2007 to March 2008 the price declined $141000 or about 45 percent.

Median sold price for approved short sales was $130950, foreclosed properties were $80875, and traditional listings were $205000.

The difference between the list price and sold price for approved sales was about 93 percent, foreclosed properties 97 percent, and traditional listings 90 percent.

Listings:

The listings for the month of March 2009 were 938 homes in the Naples area. The number of homes listed in March 2008 was 761. The increase of new listings of homes was about 23 percent. In March 2007, the new listings were 971, representing a drop of 33 homes or decline of 3 percent.

In February 2009 the new listings were 848.

Of the 938 homes listed approximately 20 percent were potential short sales, 27 percent were foreclosed (bank owned), and the remaining 53 percent were traditional listings.

Median list price for potential short sales was $200000, foreclosed properties were $109900, and traditional listings were $479000.

Closed Sales:

In the month of March 2009 the sale of homes were 296. In March 2008 a total of 183 homes were sold. The year over year was 62 percent increase. In March 2007 a total of 213 homes were sold. The increase over 2007 was 83 homes or about a 39 percent.

Of the 296 homes sold, approximately 9 percent were approved short sales, 25 percent were foreclosures, and the traditional sales were 66 percent.

The breakdowns of the median sold prices are discussed in the median sold price section below.

Pending Sales:

During March 2009 a total of 659 homes had an offer accepted by the seller. In March 2008, 288 homes were pended. The increase from March 2009 represents an increase of 371 homes or about 129 percent.

In March 2007 a total of 274 homes were pending sale. The increase between March 2009 and March 2007 was 385 homes or about 141 percent.

Median Sold Price:

During the month of March 2009, the median sold price of a home in Naples was $183,500. The median price is the sold price represents the middle value of the all sold prices within a stated range. The median sold price can vary from area to area within a local real estate market.

In March 2008, the median sold price was $365000. In the year over year comparison median sold price declined $181500 or roughly 50 percent.

In March 2007 the median sold price was $495000. In comparing March 2007 to March 2008 the price declined $311500 or about 63 percent.

Median sold price for approved short sales was $190000, foreclosed properties were $96000, and traditional listings were $235,000.

The graphical presentation of condos for sale in the Naples area shows; at the close of business on March 31st or the opening of business on April 1st, there were a total of 5228 condos for sale in the Naples area. In March 2008, there were a total of 5586. Between the years, there has been a reduction of approximately 358 condos for sale or about 6 percent.

The condos for sale at the end of February or the opening of business on March 1st was 5207. An increase from the end of February to the end of March was an increase of 21 condos.

During the month of April the end of “the season” occurs. As time moves forward the number of condominiums for sale may show a reduction in the number for sale as represented in the graph below, for the months of April to November in 2008.

Condos for Sale in Naples - February 2008 to March 2009

The number of available condos for sale, is one component for the calculation of months of condos available for sale. The other component is the average closed sales for the immediate past 12 months. It would appear at this time the months of inventory of condos for sale should be lower than it was in February.

Other factors influencing the condo market in addition to closed sales are pending sales. Pending sales reduce the number of available condos.

Naples Homes For Sale - February 2008 to March 2009

As of the end of March 2009, there were a total of 5,197 homes for sale in the Naples area. Compared with March 2008 there was a reduction of 819 homes or about 14 percent. This also represents a reduction in available homes for sale from February of 100 homes.

The number of active listings is determined on April 1st based upon the close of business on March 31st.

After the 5th business day of April an analysis of the months of homes for sale inventory will be posted on this blog for prospective buyers and sellers.

A frequent question asked in today’s real estate market is “How much will a lender or bank discount the list price of a foreclosed single family home which they own in the Naples area?”

One individual stated that banks are selling these properties with a discount of 25% from the list price or 75% of the list price.

In today’s real estate and traditionally over the past decade, it has the practice of lenders, banks and REO (real estate owned) service companies to request either an appraisal of the home by an appraiser or a broker’s price opinion (BPO), perpared by a real estate broker or agent, for the subject home to determine the estimated market value. Periodically, during the time the home is for sale, the estimated market value is reassessed using a BPO.

A study of closed sales during the month of February 2009 for Naples single family homes did not support this statement. The actual difference in terms of percentage between sales price and list price was 10.16 percent or 89.16 percent from the current list price. When looking at the original list price the sales price to list price ration was 18.45 percent or 81.55 percent.

Prior to making a purchase a prospective buyer should have a comparative market analysis done rather than looking at the list price and have a pre-determined percentage of discount from the list price set in their minds. The above percentages between sales price and list price can be used only as a guide in opening the negotiation process.

During the month of February 2009 a total of 228 homes were sold with a median sold price of $211,300 for the Naples area.

The number of homes sold when compared with February 2008 shows an increase in sales volume of 85 homes or roughly 59.4 percent.

The February 2009 homes sold also represents an increase over February 2007 by 81 homes or roughly 55.1 percent.

In addition the 2009 homes sold figure is 25.3 percent higher than February 2006 by 46 homes.

The median price of a single family home sold in the Naples area does reflect a devaluation from the median sold price of $400,000 in February 2007 or $188,700, which translates to roughly 47.2 percent.

In February 2006 the median sold price was $445,000. The devaluation is $233,700 or roughly 52.5 percent.

The $211,300 median sold in February is higher than the median price paid in the months of November, December and January, where the median sold prices were $204,000, $204,500, and $188,200, respectively.

Noteworthy is that the areas of Golden Gate Estates ($102,500), Golden Gate City ($79,900), Naples Park ($184,000) and Naples Manor ($60,000), where there is a high volume of foreclosures and potential short sales when removed from the sold homes the median sold price was $395,000 in the Naples area or roughly 34.7 percent from the median sold price in February 2008, when deducting the above referenced areas. The median sold prices for the referenced areas are shown in parenthesis.

For buyers the above data is important to keep in mind when looking for homes in the Naples area.

Within the immediate 4 months of median sold prices relatively close, it could suggest that prices are bouncing at the bottom of the market. The bottom of the market can be impacted by the current economic conditions being experienced without the United States.

Pending sale for the month of February 2008 was 484 homes. A pending sale is where a seller and buyer have agreed to both price and terms to sell the home and has been removed from the homes available for sale. The 484 pending home sales was the highest since May 2005. Over the past four months there has been a steady increase in the number of pending sales. Pending sales represent future sales of homes.

New listings coming on the market in February was 848 homes which is less than in previous February’s dating back to 2006. In February 2008 – 996; February 2007 – 1002; and February 2006 – 1,139.

In summary, the month of February the number of homes closed increased over the prior three years, median sold price has declined from previous years but the largest declines are in four neighborhoods, the volume of pending sales is the highest since May 2005, and fewer new listings came on the market than in the past three years.

Jim Cramer: Florida Raises Hope for U.S. Real Estate

It appears that Jim Cramer thinks that Florida is the model for the nation’s real estate market. He thinks that Florida was the first state to feel impact of the real estate bubble and now after 2 years it has bottomed out with the rest of the country to follow. Below is his discussion from a recent interview he had on Wall Street Confidential.

Over the previous months subtle indications in the Naples, Bonita Springs, and Estero real estate markets have shown signs of improvement by the lowering of homes and condos for sale as well as less listings coming on the market than in previous 2 years.

Prices have declined to a point where multiple offers are being presented on properly priced properties.

Buyers need to be aware of the estimated market value of a property and
be prepared to rethink that a full price offer will be
the offer accepted and be willing to offer more than the listed price close to the estimated market value.

Sellers still need to be aware that they need to properly price their properties due to the competition from potential short sales and foreclosures.

On September 19, CNBC did a story on the “Finding Housing’s Market Basement” where Richard Dekaser, a senior vice president and chief economist at National City Corp., singled out Naples in talking about the “first rays of sunshine on a possible end to the housing crisis.”

“Three years ago, the poster child for excess valuation in America was Naples, Florida,” he said.

Not anymore. Through the second quarter of this year, prices have dropped 33 percent, he said, leading him to judge the market as “slightly undervalued.” That means home prices are actually lower than where they should be.

Although I have not agreed with Mr. Dekaser in the past regarding, due largely to the methodology used in evaluating Naples overvaluation, I do have to agree with him at this time – to a point. Where I differ with Mr. Dekaser is that the Naples real estate market has gone through significant valuation adjustments and just might be undervalued to such a point where prospective buyers might be missing some excellent purchase opportunities.

In order to better understand the Naples area real estate market it is best to break down the market into an overview of single family homes and condos with a view towards the historical price appreciation prior to 2003. In the very late part of 2002, loan or mortgage program underwriting criteria were lowered to a point where sub-prime borrowers, stated income, and no doc loans proliferated. The proliferation as we are all aware resulted in abnormal price appreciation due to increased demand, which ultimately has resulted in today’s economic issues. Price appreciation 2002 and prior could represent what can be determined a “normal appreciation.”

Naples Homes:

Below is a graph reflecting both the actual and projected median price for a Naples single family home, based upon the “normal appreciation” prior to 2002, showing 1998 to 2007 for actual annual median price with actual median price through September 30 for 2008.

Graph of Naples homes median prices actual versus projected

Under “normal appreciation” the median price to be paid for a home in Naples would be approximately $378524 for calendar year 2008. Through the nine months ending September 30, the actual median price paid is $335000.

In 2005 the median price paid was $474450 (the peak of the market), while under the “normal appreciation” a home should have been selling for $295060. The drop in median price from the peak of the market to the actual year to date through September equates to 29.4 percent.

The present actual year to date median price of $335000 is less than the actual median price paid in 2004 which was $345000.

This is an overview of the Naples area single family homes and there are differences to be found between various neighborhoods where the median price declines are greater and others with where the price declines are less severe.

Naples Condos:

Below is a graph showing the median price paid for Naples condos for the calendar years 1998 to 2007, with the actual median price paid for the 9 months ending September 30.

Graph of Naples condo median price paid and projected median price.

Under “normal appreciation” the median price to be paid for a condo in Naples would be approximately $270083 for calendar year 2008. Through the nine months ending September 30, the actual median price paid is $260000.

In 2005 the median price paid was $360000 (the peak of the market), while under the “normal appreciation” a home should have been selling for $211070. The drop in median price from the peak of the market to the actual year to date through September equates to 27.8 percent.

The present actual year to date median price of $260000 is almost the same actual median price paid in 2004 which was $241000.

This is an overview of the Naples area condos and there are differences to be found between various neighborhoods where the median price declines are greater and others with where the price declines are less severe.

Summary:

When looking at history there have always been recessions where property values declined and in the long run have increased. The Naples area and Florida is projected to substantially increase. The State of Florida projects the estimated population for the Naples area to increase about 6 percent by 2010 and 14.8 percent from 2010 and 2015. Barriers to affordability have been reduced in regards to the increase in homestead exemption from $25000 to $50000, capping of assessed valuations for non-homestead properties, portability of the homestead savings to other Florida properties, historically low interest rates, and restrictions on county government spending.

These changes are subtle and will assist to increase the demand for residential real estate.

With Naples real estate currently under-valued – should you be thinking about making your Naples Florida real estate purchase at this time? If so, please call at (239) 593-3581 or email me via the contact form to the left.

The number of Naples condominiums available for sale at the beginning of October was 4716. The absolute number of listings increased by 41 condos over the 4675 listings at the beginning of September. Therefore, the months of inventory remained stable at 29 months. Viewing the months of inventory for the 12 month moving average trend shows a downward trend from February. The months of inventory in February was 37 months, while at the beginning of October it was 29 months.

Graph for the number of months for Naples condos available for sale.

The 3 month moving average is showing an upwards trend due the volume of closed sales declining while the number of available condos for sale have remained fairly stable around the 4700 level.

The 6 month moving average for the current period is showing an upward trend due to the closed sales declining.

The 9 month moving average trend is flat due to the declining closed sales.

The Naples condo market remains a strong buyers market. In the next couple of days more market condition reports will be posted here.

You may want to see a future graph depicting why purchasing a condominium residence should be a serious consideration at this time, if you are thinking about making a condo purchase.

Prior to presenting the analysis for August we need to reflect on the events which took place last August 15 – the sub-prime and liberal loan programs came to a screaming halt along with liquidity issues for lenders lasting for a couple of months. The result was a further weakening of already weak real estate market. Sub-prime and liberal loan programs accounted for about 16 percent of the purchases which had taken place previous to August 2007.

Going forward the monthly statistics will bear monitoring to assess the strengthening or weakening of the of the Naples home market.

Strengthening does not necessarily mean price appreciation, but takes into effect a lower volume of new listings (even though it is anticipated more listings will come on the market due to seasonal fluctuations), pending sales increasing, and closed sales over the previous year.

Weakening of the market will reflect just the opposite.

Another consideration to be explored is how developments or subdivisions where subprime borrowing took place may affect the overall performance statistics for the overall Naples home market, and leaving both sellers and buyers with what could be incorrect perceptions. An example of this is being seen in the drastic decline of the median price paid for homes during the month August in the year over year analysis; however, after excluding some developments or subdivisions the median price decline is not quite so drastic. Proving once again that real estate is so local that it has to be looked very closely.

August Activity:

Listings:

During the month of August 711 Naples homes were listed for sale. For the same month in 2007, 838 homes were listed for sale; this represents a decrease of 15.2 percent. The decrease from 2006 was 17.4 percent from the 833 new listings.

In July 2008 there were a total of 837 homes listed for sale.

The available for sale Naples homes have dropped from 6386 in February 2008 to 5247 at the end of August. This represents a reduction of 1139 or 17.8 percent.

The number of months of inventory or the absorption rate is presently 29 months down from February’s 38 months.

Additional detailed information will be posted to explain where the listings and identification of where distressed properties and non-distressed properties are located for a better understanding of the Naples real estate market for both buyers and sellers.

Closed Sales:

A total of 201 homes were sold during August 2008. Comparing the same month in 2007 there were a total of 164 homes sold, the higher volume of 37 homes represents an increase of 22.6 percent. In August 2006 a total of 195 homes were sold or an increase of 3.1 percent (or 6 more homes).

In July 2008 a total of 205 homes closed or 4 fewer homes.

Homes with a sales price of less than $200000 represented about 33.8 percent of the total 201 homes closed.

Homes with a sales price between $200000 and $300000 represented another 20.6 percent.

Four areas within the Naples area accounted for 37.7 percent of the August closings – Golden Gate Estates (20.6 percent), Golden Gate City (9.8 percent), Naples Park (3.9 percent), and Verona Walk (3.4 percent).

Pending Sales:

In August 2008 329 homes were placed under contract or pending for closing (pending sales are where a buyer and seller have agreed on the price and terms of a purchase and the condominium is no longer available for sale). The 329 homes is an increase over the 160 homes (106 percent) in 2007 and 202 homes (62.9 percent) in 2006.

August 2008 was higher than the 293 homes in July 2008 and lower than the 313 homes in June 2008.

Median Price Paid:

During the month of August the median price paid for a home was $265,000. In the previous year, 2007, the median price paid was $404000 or a reduction of 34.4 percent. In 2006 the median price was $434000 or reduction of 38.9 percent compared to August 2008.

In July 2008 the median price paid was $300,000 down 11.7 percent on a month to month basis.

Referring back to closed sales the areas comprising the largest percentage of closings in August shows the following:

• Golden Gate Estates – $164000 a reduction in value of 54.4 percent from the 2007 median price of $359900.

• Golden Gate City – $150900 a reduction in value of 38.4 percent from the 2007 median price of $245000.

• Naples Park – $247000 a reduction in value of 36.7 percent from the 2007 median price of $390000.

By excluding the above areas, the median price paid for a home in the Naples area was $369000 in August 2008 compared to $421950 or a reduction of 12.6 percent.

The analysis of the median price paid shows sellers and buyers should not only be aware of national, state, or area (city or town), but also by development or neighborhood to make an informed decisions in the real estate market.