The New Trends in the Naples Housing Market Explained
Many markets across the world are still adapting to the new normal, courtesy of the coronavirus pandemic. Readjustments are inevitable and might take some time, depending on the industry in question.
Various housing markets have seen different kinds of shifts for the last year, resulting in record-breaking averages. In Naples, everything happening at the moment often doesn’t match what you would expect during a traditional housing season.
For instance, buyer interest is off the roof, and inventory isn’t enough for this growing demand. Buyers are now using different tactics to get the upper hand and cope with the stiff competition. But how exactly is this influencing major market trends in Naples?
Let’s find out.
A recent surge in back-on-market properties
Homebuyers are desperate and willing to do anything to get a deal. Buying competition is incredibly fierce, with listings getting at least five solid offers. Online bidding and virtual showings are
the new norms in most local markets, forcing buyers to ingeniously use As-Is contracts to buy more time and secure available options. Unlike standard contracts, As-Is contracts give buyers the right to bail out for whatever reasons.
Regarding buying behavior, buyers are increasingly using non-covered inspection items to renegotiate home prices. It is one of the main reasons explaining why there is a sudden increase in back-on-market units.
To avoid putting your home up on sale severally, sellers should note this and insist on signing standard contracts only. As for buyers, picking your best option from the market and committing to it will help reduce the current buying pressure.
An increase in cash sales
March reports for the Southwest Florida housing market revealed that the year-over-year cash sale ratio rose by 7%. In a situation where listings are getting multiple offers, cash buyers often have an advantage over financed buyers.
From the archives, current cash sale rates aren’t alarmingly high yet. The highest cash sale rates ever recorded in Naples real estate history were in 2017 and 2018.
Besides the extra edge experienced in a seller’s market, cash buyers usually exploit sellers by using the concept of scarcity in a buyer’s market.
In such cases, sellers should understand that the appraisal process usually lags. To be safe, you should consider asking for proof of funds and a valid pre-approval letter to guarantee that the buyer can pay the difference in cash if the property fails to appraise accordingly.
Professional property managers such as the Woodruff Property Management and Real Estate team can successfully pre-negotiate this on your behalf and minimize any uncertainty that might arise during the sales process.
Builder’s new trick
Everyone in SW Florida is changing tactics, and builders aren’t left behind. Builders in Naples have changed their sales tactics to resemble home seller’s success. This move helps builders maximize both value and profitability, as they can now increase home prices as it rises.
With low new supplies and growing demand, experts fear that this tactic might increase resale prices, taking away all buying alternatives.
The Mortgage Bankers Association and Freddie Mac concur that housing markets throughout the United States will continue with current momentum probably until 2022.
The new construction market segment saw an average growth of 16% since last year throughout Lee and Collier Counties. As for the resale market, experts still caution that the current levels are unsustainable for long-term predictions.
The main recurring challenge that builders are facing is the general lack of construction materials. In Naples, building material stock is out for about 14 months. With more than 35% of fully vaccinated individuals living in the Sunshine State, experts are hopeful that a resurgence in the new construction front might happen sooner than expected.
Real estate demand throughout SW Florida is at record high levels, especially now that many millennials are getting in the market in masses ready for homeowner ship. The general mismatch between demand and supply continues to make this market unstable, forcing buyers to change and try new tactics to beat the competition. We’ve discussed some of the emerging trends in the Naples housing market, hoping that the details will help you have an easier time navigating through and understanding local market behavior. For more in-depth analysis and customized property management assistance, call (720) 724-9794 or email your query to firstname.lastname@example.org.
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