May had the highest number of new listings in the last three years than any May. Fellow brokers who also analyzed the NABOR® May 2022 Market Report are pleased with this trend as it will lead to more options for summer buyers. New listings during May pushed the inventory of homes for sale up 58.6 percent to 2,046 properties compared to 1,290 properties in May 2021. By the end of May, our inventory in Naples has nearly doubled since the same time a year ago. And if you include the 889 homes that had a price reduction in May in this inventory mix, then we're in good shape for the summer months. Price reductions are like new listings because the home's new price point becomes a unique opportunity for a larger pool of buyers. Brokers like me prefer to compare this year's activity to the activity in 2019, as it was a balanced year with a 7.3-month supply of inventory. A healthy market for us is six to 12 months of inventory.
There was a 24.5 percent decrease in May to 1,249 closed sales from 1,654 closed sales in May 2021. However, using 2019's balanced market activity as a comparison, closed sales increased 7 percent month/month and 18 percent year to date. Demand remains strong despite having three times fewer inventory options than 2019 levels. Today, we have a 1.9-month supply of inventory. The median closed price increased 40.3 percent in May to $608,000 from $433,500 in May 2021. Since January, we've seen a 21.9 percent increase in the number of homes sold in the $500,000 to $1 million price category.
The NABOR®, May 2022 Market Report, compares single-family home and condominium sales (via the Southwest Florida MLS), price ranges, and geographic segmentation and includes an overall market summary. For those who enjoy statistics, the NABOR® market report is in a chart format (
CLICK HERE
).
What does this all mean?
The red-hot Naples Market from June 2021 through March 2022 is starting to cool. As mentioned, inventory is increasing, and we still have demand, but having multiple Buyers throwing in competing offers is becoming rarer. However, a larger supply is not the only factor. Interest rates are climbing. The stock market is down 35%, and we are experiencing rapid inflation.
All this news is not copasetic for the average Seller, but Buyers are sighing with relief. They still are not in the driving seat, but they are sitting "prettier" than they were just a few months ago. Prices are coming down, but not significantly. Why? Because Naples and the Southwest coastland have been undervalued compared to other coastal cities. The market in the past year has made its correction.
Everyone who purchased a home during this time paid cash or financed. In fact, in May, 63.3% of purchases in Naples were cash. Today, financing is not an easy task because the underwriting process is so regulated and rigorous that everyone financing can afford to purchase. It is very different from the "Great Recession" and the housing industry's collapse during that period.
What about the Rental market?
Seasonal rentals (January, February, and March) in 2022 were booming. Demand was so great that monthly rentals rates increased by at least 20%. In 2023 there is still demand, but not the kind of demand we had earlier this year. Because Florida opened earlier than most states, many people flocked in 2020, 2021, and the beginning of 2022. However, most of the United States is now open and has lifted the mask mandate, so there was no reason for these people to head south. Therefore, the rental market is starting to soften here, and monthly rental rates for seasonal and annual rentals are decreasing by an average of 5%.
The cache of the Southwest Florida Market
The Southwest Florida market is still very appealing, and people want to live here. In fact, out of the 25 fastest-growing cities in 2022, Florida has 11 cities on the list, and Naples and Fort Myers are two of those cities.
Florida has the tenth-best quality of living in the country. Florida's economy is one of the strongest in the nation, with a GDP of over $1.1 trillion. Florida would be the fifteenth wealthiest nation in the world if it were a country. The economy also continues to grow, with over 500,000 jobs added last year. Our beaches, quality of life, and being a tax-friendly state is unmatched.
If you need assistance selling, buying, or renting, please contact me at 239-293-3592 or send an e-mail to
Robert@NardiRealty.com
. I am here to help!
Enjoy the rest of your Summer!
Implementing even one of these five tips will help you lower your summertime cooling bill. Put all five into practice and you may save more money than you thought possible. Just don’t forget to turn down your AC.
