BUYERS BALK AT RISING PROPERTY PRICES
February MLS (Multiple Listing System) report from the Naples Area Board of REALTORS shows a rather dramatic drop in Closed and Pending Sales of both single-family and condominium properties in the Naples area. Upon a closer look, it is evident that continuing price increases may be the chief reason for the falling sales. Add higher real estate prices to lower returns from stock investments, less buying power of the Canadian dollar and the general global economic problems for any number of reasons for the drop in sales of Southwest Florida real estate. In general, property purchases in our area are not driven by necessity, although there is a reported increase in employment which may become a factor in SW Florida. Last month’s results should not come as a surprise, since closings in the $300,000-and-under price segment have been slowly slipping as less and less listings in this previously dominant price segment have been available since the last quarter of last year. While inventory of single-family homes continued to fall in February, down 20% compared to 2014, the same price bracket for condominium listings actually rose by the same percentage. Whether this is a one-time rise or the signal of more to come is not yet clear. The buyers balk at higher prices has resulted in more homes and condos being available for sale, so we are also now seeing sellers offering price discounts and new-construction builders offering “free” optional items such as swimming pools. As we head into Spring, the Naples area appears to offer buyers new reasons to justify new pricing.