Hello Friends and Neighbors!
May has been a record month for The Brown Realty Group. We have intentionally pushed back the writing of the May newsletter so we can accurately report that we have had 5 closings this month, including a Quail West closing of $2.24MM. In the past year, we have closed approximately $20MM in real estate transactions. Our Downing-Frye Realty Broker is also setting records. The broker may close in excess of $200MM in sales volume for the month of May. Some of our clients honestly ask us whether or not we do any real estate business out of season…the obvious answer is, “YES”!
In reviewing the Bonita Springs-Estero Association of Realtors (BEAR) report for the month of April, we can report that sales are holding steady. According to Jerry Murphy, managing broker at Downing-Frye, “As more sellers adjust pricing to the current market value, the more pending activity we’ll see going forward. Adjusted pricing also has contributed to the median home price trending downward in April vs April of 2016.” For April 2017, there were 445 price reductions out of 1785 total active units.
In reviewing the BEAR activity for single family homes vs condominiums, there is a clear distinction between both segments. The single family home market is holding and stable as pricing moves toward fair market value. For the condo market, there is a significant increase in the days on the market vs the prior year. “Condo owners have not moved as rapidly to make much needed price reductions in this segment yet,” stated Brittany Skotak of The Brown Realty Group. “Condo sellers must move quickly on price repositions if they hope to sell this summer, as buyers will not look twice at an overpriced listing,” says Skotak.
Turning our attention to the Naples area market report, we see that inventory decreased for the second consecutive month and prices continued to remain stable in April, setting into motion a burst in end of season sales for homes in the market’s sweet spot – the $300k-$500k price category. Although that segment of the market is clearly on fire, the higher-end market is showing a lot of activity as well. Rick Brown of The Brown Realty Group pointed out that the April Naples report showed a 41% increase in pending sales for homes in the $2MM and above price category. “There were 10 sales over $5MM in April,” said Brown.
Brenda Brown of The Brown Realty Group points out in reviewing the April market report, homes that are unrealistically priced influenced April’s average days on the market, which showed an increase of 35% in April 2017 vs April 2016. “There appears to be a number of sellers who, when pricing their homes, refuse to take into account the added competition from the new construction market,” said Brenda. Also, sellers often fail to take into account that their homes do not have up-to-date renovations. Julie Ross, appraiser with Carroll & Carroll, states “Buyers are looking for kitchens with up-to-date cabinets with either quartz or marble counter tops and stainless-steel appliances. For bathrooms, spa-like features, such as natural wood or bamboo are also coveted. Properties that do not have updated renovations must be priced accordingly, as the buyer will take those expenses into consideration.”
On the commercial side of real estate in our area, Rick Brown said, “The area has dramatically low industrial property options. Naples has plenty of office and retail space available, but not much in terms of large commercial space. That’s why I am personally building a large commercial and light industrial building just north of here in Punta Gorda.” If you have interest in commercial real estate, please feel free to contact Rick Brown.
In summary, for sellers, the market is still hot. However, today’s sellers must price their homes competitively in light of competition from new construction. Sellers must be honest about the condition of their home. If your kitchen and baths need to be renovated, then your pricing must take that into account.
All of us at The Brown Realty Group are familiar with the new developments and re-sale developments between Naples and Fort Myers. Whether you’re a buyer or a seller, contact us for information about these markets.