In the Know: Too expensive? More evidence of housing slowing. Naples nightly hotel stays rise to $416
Phil Fernandez
Bidding wars. A majority of home cash buyers in Collier County and parts of Lee. House listings lasting only hours. Properties going well over the asking price.
While coronavirus continues to linger largely among the unvaccinated, a few of the pandemic-era real estate trends continue to subside.
That may be providing more of a lane for buyers in what's been a long-running seller's market.
"While demand continues to outpace available inventory, the demand seems to be easing some in that we are now seeing fewer offers in multiple offer situations," said Erin McDonald, managing broker for Premier Sotheby’s International Realty. “Instead of seeing 10 buyers we are seeing three, giving buyers a better chance."
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Interest is beginning to soften with 17% less home searches in April than March for the Bonita Springs - Estero Realtors group, which tracks the 33928, 34134 and 34135 zip codes in the Southwest Florida multiple listing services, McDonald said.
"It may take a price adjustment to spark an offer," she said.
BER stats showed reduced asking prices on 40% of its inventory at the end of April.
"We continue to see a slight uptick in available inventory as well as an increase in price adjustments on properties currently on the market," said Steve Kolenda, managing broker for Berkshire Hathaway HomeServices Florida Realty in Bonita Springs. "The changes we are seeing could benefit buyers."
'Buyers have more options'
By comparison, a third of Naples Area Board of Realtors homes for sale – equal to 549 – experienced price reductions.
“What we are seeing today are more sellers setting realistic list prices from the start, and more buyers less willing to settle for homes that don’t meet their exact needs and desires,” said Brenda Fioretti, broker associate at Berkshire Hathaway HomeServices Florida Realty,
NABOR's inventory climbed to 1,668 properties in April, 16.5% higher than a year ago.
“It’s been 30 months since we’ve seen this many single-family home sellers enter our market in one month,” said Bill Coffey, broker manager of Amerivest Realty Naples.
Having additional choices may have played a role in NABOR providing 200 more showings than it did in March.
“When inventory rises, buyers have more options," Vanderbilt Realty Broker Dominic Pallini said. "If inventory continues to rise, it should create more balance during negotiations between sellers and buyers."
Still, stability isn't quite there, as partly illustrated by the days on market average. Last year at this time it was 48 for BER, compared to April's 10. It's now 16 for the Lee-based Royal Palm Coast Realtor Association, which also has seen an increase in supply, and NABOR, which has a historic average of 90.
"Median prices and the ratio of sale vs. list price are still strong," Kolenda said. BER "cash sales also continue to hover at close to 70% of total transactions." The latter was similar for NABOR.
And business is not slowing down for some brokerages.
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'Tremendous amount of interest from people in the United Kingdom'
The growing Domain Realty had its best month ever in both volume and its record 127 transactions, Managing Broker Adam Ruud said. The $127.1 million tops its previous high of $90.8 million in June 2021.
"This month is remarkable,” Ruud said of April, "in the midst of a crazy market, low inventory and truthfully speaking, a challenging time to practice real estate."
The agency, with offices in Fort Myers and Naples and growing its crew from about 50 in 2015 to nearly 300 this year, just unveiled its fresh Bonita Springs digs at 24031 S. Tamiami Trail.
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"We are exactly at 294 active agents," Domain's Christine Brawley said this past week. "I expect we will hit 300 in no time as we have been averaging 14 hires a month since January."
And while not sparking the same concern as it did 247 years ago on repetitive Paul Revere's ride, the British are coming. Make that still coming.
“We have seen a tremendous amount of interest from people in the UK who have their eyes set on Florida," said BER CEO Meighan A. Harris, fresh from a recent London real estate expo. 'They would like to trade England’s (annual) average of 90 sunny days for our average of 271."
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NABOR median surges to $599,000
The Brits, along with many other international visitors, immigrants and potential workers, had largely been shut out of the local market after President Trump closed borders and nearly all travel in 2020 to fight the pandemic. President Biden began welcoming them back to the U.S., just before last Thanksgiving, in time for the busy holiday season and prior to the peak of snowbird flight.
Those travelers, investors and new local residents from all over the globe are among those dishing out the big money.
NABOR's April median closed price hit $599,000, a 36% jump over last year. For BER, it was a 55% leap to $547,000. Lee's Royal Palm: Up 37% to $410,000.
Working with a different data set that includes Marco Island and focused more on listings than sales, Realtor.com's median list for Collier was $875,000. Lee: $499,000.
April's most expensive single-family property transfer in Southwest Florida came on a five-bedroom, seven-bath home at 4444 Gordon Drive in the Port Royal neighborhood for $36 million, the highest through the first four months of 2022. It previously sold for $27 million in 2021, according to Collier public records.
For the second month in a row, a Captiva home was No. 1 in Lee, selling for $11 million, also tops through April. The seven-bedroom, six-bath home on the 15800 block of Captiva Drive previously sold for $4.8 million in 2021.
Tourism spending up as yet more hotel investments slated for The SWFL
We've been writing a lot about the continuing hotel-related deals and investments that keep coming.
Yet another one popped up this past week: A 124-room hotel is slated in Fort Myers off Six Mile Cypress Parkway between Metro Parkway and Plantation Drive. LSI Companies brokered a $1.5 million deal for the 2.5 acres acquired by Turnstone 6 Mile LLC, which has connections to both Naples and the Buffalo, New York area.
Other new spending:
♦ 34-unit Gulfview Manor, part of a nearly $20 million transaction that includes the Beach Theater, which is closed for now as its newest ushers determine how to gui its future on Fort Myers Beach's south end. The ownership group involves Signature Vacation Properties, which has the Blue Dolphin Inn and Palm Terrace Resort as part of its stable of island lodging. Gulfview made its debut in 1982.
♦ 100,000 square feet of the Pink Shell Beach Resort & Marina and its 195 condo-style villas and studios are targeted for a $7 million renovation to launch in August and wrap up in early 2023. To think it evolved from a single cottage in 1950 to an expansive 12-acre enterprise on Fort Myers Beach where bosses brag about "barefoot elegance." Just wash your feet please.
A major driver in all of this is a monster return. And we're not talking about the like 427th heavily promoted Jurassic Park installment, which is due out next week.
Our largely friendly beasts are tourists who roared back after the easing of the Trump-era travel bans, paying serious bucks in Southwest Florida.
For example, new numbers out this past week from Collier government shows tourism spending up 25% as compared to April 2021, a month that then had already easily exceeded pre-pandemic levels.
'Market conditions' end a hotel project
But just as escalating prices in real estate are starting to affect national interest in the area, so, too, a few travelers are grumbling about what they're doling out here, the county report said: "High cost was the primary reason for visitors providing lower ratings."
The average daily lodging rate: $416, up 21% from a year ago's $345.
So yes, that's a reason they're handing out more Benjamins to fuel the industry at the moment. As it turns out, occupancy actually was down last month, an 8% plunge from the about 72% of last April Fool's Day.
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That kind of "reality of market conditions" has prompted Naples Developer Jerry Starkey to scrap a planned posada on a 5-acre pizza-sliced parcel where the toppings keep changing.
"There are plenty of hotels," said Starkey, a main player behind the Metropolitan Naples complex where groundwork has begun at the bustling Davis Boulevard junction tapping into Tamiami Trail. "It's all market-driven, 100% of it."
Starkey told my colleague Laura Layden that he's seeking changes to what had been previously approved by Collier leaders to now include more residential living to go with commercial space. And that's just the way it's been cooking for this venture, which has heating in the oven for awhile, with building construction just months away.
While potential offerings once included an upscale movie theater, it's off the menu — after CMX CinéBistro opened in the fall just over three miles away at Coastland Center, Starkey said.
An organic grocer and a luxury car dealer had been on the bill of fare, too, but they're no longer among the ingredients, having chosen not to expand, or to go elsewhere, Starkey said.
"We were dealing with Ferrari, and they ended up going north," he said of the fast-car merchant that found its finish line on U.S. 41, just north of Immokalee Road.
Affordable housing hits local industry
As expansion continues overall, what are hoteliers making from the nearly 150,000 travelers who stayed in April at their accommodations, based on the Collier tourism report? Revenue: More than $275 nightly per room. The average stay: 5.5 nights.
But those hefty returns haven't translated into more industry workers, who are finding it increasingly difficult to live in Southwest Florida. February county statistics, the latest available that are finalized, show 31,800 workers in leisure and hospitality. Two years before that: 33,000.
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"One of the things we hear about all the time is the housing affordability crisis and challenges in finding employees and talent," said Tiffany Esposito, CEO of the 3,000-business member SWFL Inc. group that hosted a gathering this past week. "Those are absolutely the most resounding issues that we hear. From a housing standpoint, we need more market rate homes that are affordable for the general workforce."
Targeting government, the group is "working each and every day asking for policies that allow for workforce housing opportunities," Esposito said. "There are many innovative solutions, and there's one that's really cool called Boxabl. Basically it is a readymade home that will unfold in an hour. (It is) really cool, but there's a lot of things like that that we can incorporate within our communities to help solve this housing crisis."
However, experts, residents and advocates said at this past week's Collier County Commission meeting and numerous previous forums that a lack of urgency prevails on the part of affordable housing liaison Rick LoCastro and a few fellow commissioners.
The commission once again failed to pass an initial legislation concept backed by the city of Naples and other communities in Florida and 18 states including Texas, Indiana, Ohio, Iowa, Arizona and Alabama. LoCastro said many reaching out to him are misinformed on the issue. But the chairman and other members of the county's Affordable Housing Committee beg to differ.
"On Feb. 22nd, I stood before you and submitted a list of recommendations that came from (the committee), important things that will change the future of affordable housing in Collier County. Three months have gone by," said Joe Trachtenberg, former chair of St. Matthew's House. "It's time for Collier County and its commissioners to address the serious problems we're facing with affordable housing, and we're not doing that now."
Based at the Naples Daily News, Columnist Phil Fernandez (pfernandez@gannett.com) writes In the Know as part of the USA TODAY NETWORK. Please take time today and every day to remember the many who bravely served our nation to preserve our Democracy and Free Speech that remain under attack. Support the First Amendment and subscribe to a newspaper.