Naples, Florida (August 21, 2020) – The Naples housing real estate market experienced a continued surge in activity during July, which resulted in a 57.3 percent increase in pending sales (homes under contract) for the month. Closed sales during July increased 35.4 percent compared to July 2019 – greatly surpassing June’s closed sales activity following the lifting of COVID-19 restrictions. However, a decreasing supply of inventory, which broker analysts believe is caused by heightened home buying interest this summer, is making it difficult to keep up with the strong buyer demand.
“A considerable number of buyers already looked at homes during season [January and February], prior to COVID-19 restrictions,” said NABOR® President Lauren Melo, “They watched and waited during those months of restrictions and are now back to buy a home this summer.”
The tapestry of out-of-state license plates on local roads may be an unfamiliar summer sight to local residents, but according to broker analysts reviewing the July 2020 Market Report released by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island), these visitors are here to do more than just golf and visit the beach this summer.
Real Estate Sight Unseen Purchases
There were 15,634 showings during July, less than half the number of showings during June (36,912), yet pending sales increased which indicates that properties were purchased virtually, sight unseen. July’s pending sales spiked to 1,446 pending sales in July 2020 from 919 pending sales in July 2019.
Overall inventory decreased 28.8 percent in July to 4,390 properties from 6,168 properties in July 2019. However, many sellers were not hesitant about entering or staying in the market this summer. A steady rise in consumer confidence resulted in 1,193 new listings added to the overall inventory during July (a 21.7 percent increase compared to July 2019). Of those 1,193 new listings, 572 were single-family homes and 621 were condominiums. The report also showed fewer homes were terminated/expired/withdrawn from the MLS in July (599) compared to June (1,677).
The majority of sales that resulted in the 35.4 percent increase in overall closed sales during July occurred in the single-family home market, which saw a 42.8 percent increase in closed sales compared to a 27.3 percent increase reported in the condominium market. Concern over the pandemic has compelled many people to spend the majority of their time indoors, at home. As a result, buyers are looking for single-family homes that offer more personal space, and more space to work from home and home-school children. They want their own backyard, their own private pool, and private garages that single-family homes offer.
Thinking About Selling Your Home?
For those who are considering selling, now is a good time to jump in the market to take advantage of the high demand for Naples property, according to broker analysts. Plus, with fewer homes on the market for buyers to purchase, this may be the time for your house to stand out from the crowd with less competition and more eyes on your property.
While the overall median closed price for July increased 13.5 percent to $368,750 from $325,000 in July 2019, the report also showed there were 829 properties that reduced their list prices during July. It appears sellers re-calibrated their pricing and/or were striking new deals.
The report showed closed sales of properties priced above $500,000 increased over 50 percent in July, with the $500,000 to $1 million price category reporting the highest increase (99.1 percent) to 223 closed sales in July 2020 from 112 closed sales in July 2019.
“Single-family home inventory dropped 38.7 percent in July to 1,957 homes,” remarked Melo. “This is the lowest it’s been since October 2015. But even at this level, Naples has 4.5 months of supply in the single-family home sector.”
Cash Still King
In comparison, Naples had 5.2 months of supply in the single-family homes sector in June, which was much higher than Florida Realtors® statewide reported June single-family home figure – 2.8 months of supply. Even though interest rates on mortgages remain low, 43 percent of July’s closed sales were cash sales.