U.S. home prices rose in September at the slowest pace in more than two years, reflecting modest gains and a rising number available homes. The Standard & Poor’s/Case-Schiller 20-city home price index, released on Tuesday, rose 4.9% in September from 12 months earlier. But, that is down from 5.6% in August and is also the smallest gain since October 2012. On a monthly basis, the 20 city index was unchanged, the first flat reading in 7 months. The monthly changes aren’t adjusted for seasonal factors such as colder weather, which can impact sales. Prices dropped in 9 of 20 cities from August. Eighteen of the 20 cities reported slower price increases over the past 12 months. Only Charlotte, NC and Dallas, TX reported larger annual gains than in August. Miami posted the strongest 12 month gain at 10.3%, followed by Las Vegas at 9.1%. Nationwide, sales of existing homes rose in October to their fastest pace this year, evidence that the housing market is rebounding from a slow-down last spring.
Locally, the market continues to be hot. A new National Association of Realtors report shows the Naples Metro area is 3rd in the nation in terms of year-over-year single family home price increases for the 3rd quarter. Moreover, the price jump far outpaces increases on both a state and national level. That’s good news for sellers who are being helped temporarily by tight inventory and an influx of out-of-state cash buyers. Rick Brown of The Brown Realty Group believes that is not something sellers should count on for the long-haul. “You will be seeing a slow-down soon,” Brown predicted. The double digit price increases are simply not sustainable,” according to Brown.
As evidenced in the Case-Schiller report, prices in other cities are not rising as rapidly as they are here in SW Florida, buyers who are relying on higher equity levels to buy vacation homes, or the sale of their primary homes to pay for retirement homes, soon will be looking at more affordable areas. The Brown Realty Group is frequently asked by buyers, “How do we accurately price our home in a rapidly rising market such as SW Florida?” The trickiest part of pricing is taking into account that the closed sale price of a “pending sale” may not be reported in the MLS or other public data base for 30-60 days from the contract date. In the Fort Myers to Naples corridor, factors such as cash buyers, foreclosures and newly built homes can all impact pricing. “Nobody wants to over-pay for something and home buyers are no different,” says Brenda Brown. “Yet, when you compare the same month year-over-year, prices have risen 38 consecutive months in Collier County and 14 consecutive months in Lee County,” said Brown. Therefore, The Brown Realty Group uses an arsenal of research tools to help both buyers and sellers to find the true fair market value of their home.