Commentary by Fatima Khokhar Knapp
Cooperation is the Key…
The press release below details the facts and figures behind the decline of housing inventory in 2011 for Naples, Florida. The numbers are impressive though there are a few elements that have become apparent since September 2011 that are not captured in the press release and are important to note.
Visual Demand; Clients have been surprised to see other agents and their clients waiting for us to finish viewing a property, a phenomenon that we as agents have not witnessed for a couple of years in Naples. This is a powerful form of tacit persuasion and communicates to buyers that demand does exist.
Client and Seller Cooperation; Clients requiring a mortgage need to obtain an appraisal and recently the market values have been documented at 10-15% below the negotiated contract price. Naples Meridian has represented the buyer on several occasions where sellers have agreed to the necessary concessions in order to seal the deal. In the end it is the genuine demand from buyers coupled with the sellers’ willingness to acknowledge the appraised property values that has lead to the decline in inventory in Naples.
Cash rich investors and second home buyers purchased property in Naples in 2010 yet it is the second wave of buyer with financing contingencies that have filled in the holes. Cooperation between buyers and sellers at all price levels is a fundamental principle in contract negotiations and this key element will bring about long term stabilization to our market.
Housing Inventory Press Release from Naples Area Board of Realtors
2011 HOUSING INVENTORY ENDS AT 5 YEAR LOW
Annual Pending and Closed Sales Rise
A service from the Naples Area Board of REALTORS®
NAPLES, Fla.-January 20, 2012- The 2011 Naples area real estate activity has led to a five year low of inventoryaccording to a report released by the Naples Area Board of REALTORS® (NABOR), which tracks home listings and sales within Collier County (excluding Marco Island).
Statistics compiled by NABOR show an increase in overall sales with inventory diminishing in Collier County, which is an encouraging sign that the favorable market conditions are moving buyers.
“Homebuyers have fewer choices today in 2012 than they had in 2011. Sales have continued to increase which has resulted in the overall available inventory to decline and naturally increase prices in some market categories,” said Kathy Zorn, Broker/Owner of Florida Home Realty
Brenda Fioretti, NABOR Media Relations Chairman and Managing Broker of Prudential Florida Realty agrees, “As the winter sales season begins in the Naples area, we currently have 1,564 fewer homes on the market than we did at the same time in 2010. The loss of listings includes 1,000 properties in the $300,000 and under price bracket. This is the lowest level of available homes and condos we have seen at the start of a new year since 2007!”
The available inventory declined 17 percent in 2011 with 7,581 available properties compared to 9,145 available properties in 2010. In the under $300,000 market category, the available inventory declined 21 percent to 3,771 properties in 2011 compared to 4,763 properties in 2010.
“Overall pending sales and closed sales increased year over year as our inventory continued to decline in 2011. Pending sales increased 8 percent and closed sales increased 5 percent,” said John Steinwand, President of Naples Realty Services.
Every market category showed sale increases in both pending and closed sales with the largest increase in the $1 million and above categories.
“Closed sales in the $2 million and above luxury market increased 12 percent with 223 sales in 2011 compared to 199 sales in 2010,” said Bill Poteet, 2012 NABOR President and President of Poteet Properties. “The traditional market has become a large percentage of our total market share (66 percent)as the number of short sale and foreclosure sales diminishes.”
The 2011 report provides an overall summary and combines statistics for both single family and condominium properties. The statistics are presented in chart format, along with the following statistics: The overall median closed price over $300,000 increased 2 percent to $550,000 in 2011 from $540,000 in 2010.
- The 2011 fourth quarter report showed overall pending sales for the 12 months ending December 2011increased 8 percent to 10,071contracts compared to 9,319 contracts for the same 12 months of 2010.
- Overall closed sales in the $1 million to $2 million category increased 38 percent with 76 sales in the fourth quarter of 2011 compared to 55 sales in the fourth quarter of 2010.
- Single-family home sales in the $500,000 to $1 million price range increased 13 percent with 90 sales in the fourth quarter of 2011 compared to 80 sales in the fourth quarter of 2010.
- Condo sales declined 2 percent to 793 sales in the fourth quarter of 2011 compared to 808 sales in the same quarter of 2010.
I look forward to hearing your thoughts, comments and questions regarding this report...