In Lee County, median sales prices are down 4%; in Collier they’re down 7%. Sales volume also dropped a bit while inventory has increased about 8%.
NAPLES, Fla. – For sellers looking to sell at the top of the market (in Southwest Florida), the reality is it’s already too late. The market has peaked, and we are now on the downside of the record high prices we have experienced over the past two years.
After a three-year consistent increase, we have seen the first dip in median sales prices over the past month.
In Lee County, the median sales prices are down 4%, and in Collier sales prices are down 7%. This downward trend has also been seen in the number of sales. Lee County sales are down 10% and Collier County sales are down 30%, making June sales in Collier County the lowest number since 2013.
Though sales prices and volume of sales are down, inventory has increased about 8%. The increase in inventory and decrease in sales will continue to put downward pressure on home prices.
The active market is seeing price reductions of 20 to 1 as compared to price increases. Four months ago, we saw these numbers to be almost exactly the opposite, with most houses selling for above the asking price and even being raised once already on the market.
With these current trends, sellers need to be realistic if they are serious and motivated to sell. The profit margins are still healthy, but buyers are not willing to pay drastically over home value as the market was showing only a few months previously. Housing prices have increased as much as 70% in the last two years, so with an average current price reduction of 5-10%, there is still a lot of win there for sellers if they have proper expectations.
Buyers, this is the market you have been waiting for, the conditions are optimum as the market is correcting itself. It is important to be actively looking and stay patiently ready. There are some great deals out there, but you must be aware and stay diligently prepared to make the necessary moves to secure the best deal possible.
Some buyers may think it is smart to hold off on purchasing if the trends are starting to show a downward price trend. These buyers need to understand that the real estate market is still always a bit of a gamble, and we must continue to watch the trends. If you wait too long you can miss the opportunity and the market could increase again.
What is most important to understand is that this is a market correction not a crash.
The market in southwest Florida saw such a drastic increase over the past two years, it was inevitable that it would eventually start to regulate. Though the market is regulating there is still no need for concern over the current trends.
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