Naples, Fla. (November 27, 2023) – Real estate brokers reviewing the October 2023 Market Report by the Naples Area Board of REALTORS® (NABOR®), were encouraged to see a 31.8% increase in new listings to 1,231 new listings from 934 new listings in October 2022.
The report also showed the median closed price of homes in Naples during October increased 4.5% to $580,000 from $555,000 in October 2022. According to broker analysts, these two factors indicate false rumors of an extreme market correction. They also illustrate renewed seller confidence, which will be good news for buyers seeking more options in the coming months.
“October had the highest number of new listings added to the market compared to any October in the last two years,” remarked Dominic Pallini, Broker at Vanderbilt Realty, Inc.
Historically, and according to NABOR®’s monthly market reports, October and January have the highest number of new listings. New listings in October for the condominium market shot up 61.9% to 612 new condominium listings from 378 new condominium listings in October 2022. Single-family home new listings in October also increased at a healthy rate of 11.3% to 619 new single-family home listings from 556 new single-family homes listings in October 2022. Obviously though, one factor contributing to a rise in new listings this October was the need for many homeowners to postpone listing their properties for sale last October until damage from Hurricane Ian could be repaired.
“The value of working with a REALTOR® in Naples is priceless,” said Jillian Young, President, Premiere Plus Realty. “Unlike housing markets in other areas of the country or Florida, Naples can be a bit of a tough nut. You might think your house is priced right based on a comparison of homes for sale nearby, but without a REALTOR® who understands the nuances of the existing home market or what planned new community developments are on the horizon, you might risk your home being overlooked by buyers if it lingers on the market too long because it wasn’t priced right.”
Pent-up consumer travel during the summer distracted attention away from home sales as the report showed both pending sales (homes under contract) and closed sales activity were lower than pre-pandemic levels reported for October. This can be traced to lower showing activity during the recent summer compared to summer 2022. As such, overall pending sales in October decreased 1.2% to 665 pending sales from 673 pending sales; and overall closed sales in October decreased 12.8% to 594 closed sales from 681 closed sales in October 2022.
Higher days on the market also contributed to lower sales in October. For example, in the summer of 2022, days on market were below 20 days. Whereas, this past summer, days on market were over 50 days. For October, days on market increased 36.6% in October to 56 days from 41 days. Given this data, brokers anticipate healthy pending and closed sales activity in the coming months as showings during October increased 14% to 21,180 showings from 18,654 in October 2022.
The NABOR® October 2023 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 2023:
According to NABOR® President Nick Bobzien, “Interest rates are not as much an obstacle in Naples as cash sales continue to exceed 50% of all our sales, but they are for many northern home sellers who rely on buyers that require financing. There’s talk that some buyers are also sitting on the fence waiting for rates to drop. But regardless of when and whether the rates drop next year, our area is still well below a balanced market level [4.5 months of supply in October].”
Sherry Stein, CRB, responded to Bobzien’s comments by stating, “It’s also likely that when rates go down, prices will go up. So, delaying a home purchase until the Fed lowers the interest rate ignores the real possibility that the home you can finance today might increase in price beyond what you can afford to finance when the rate is eventually lowered. In any event, nothing is stopping a buyer today from refinancing when the rate drops down the road.”
Incidentally, and according to Cindy Carroll, of Carroll & Carroll Appraisers & Consultants, LLC, a balanced market for Naples is when there is a 12-month supply of homes in inventory. As noted by Young, “The Naples Beach area [34102, 34103, 34108] has a 10-month supply of single-family homes for sale, and that’s even with the average closed price for single family homes decreasing 12% in October.”
Sales of luxury properties continue to drive the metrics for the real estate market in Naples. Looking at October’s market report, Stein said, “The average closed price of all properties – year to date – in Naples is over $1 million. And compared to last October, there are now 275 homes for sale in the $5 million and above price category, a 55.4% increase.”
The good news for buyers is that the percentage of list price received has decreased by 2.7% and 3.5% in the single-family and condominium market over the past 12 months, respectively. Pallini commented that “there were also 1,004 price reductions in October, basically a third of all homes for sale. Buyers will likely have more opportunities to negotiate if inventory continues to rise at its current pace.”
