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The first quarter 2009 posted some very exciting changes when compared with the past two years. The real estate recovery in southwest Florida is definitely well underway, and barring any unexpected national or international issues, is expected to continue to gain momentum in the coming months.

There is no doubt that the real estate market in southwest Florida is at its most robust level since the correction began in 2006. Average sales price has fallen 50% overall since its peak in 2007. This is an obvious effect of the number of lower priced properties selling, and the fact that in the first quarter of 2007 there were 92 closed sales in the over $2,000,000 price segment, compared with 45 for the first quarter 2009. However, March 2009 showed a slight increase over March 2008 in pended sales for this category. Showing activity and inquiries on specific properties in this price range indicate a high level of interest, and several very large sales which will be reported in the second quarter may indicate a turning point for this segment. We will continue to carefully monitor supply and absorption over the coming months.

Closings and Inventory
Current inventory in the combined Naples, Bonita Springs Estero market stands at 13,973 single family homes and condominiums (April 1, 2009), representing approximately a two year supply. This is down substantially from 2008, when at the end of the first quarter total inventory was at an approximate three year supply.Closings have taken a major upturn with a 20% increase over first quarter 2008, and the highest first quarter number since 2006. With the exception of the banner years of 2004, 2005, and 2006, this is the second highest first quarter in the past 10 years. The price segment under $250,000 accounts for 63% of these closings. Despite the high level of closing activity, it continues to be the only price category to show an increase over 2008 in currently available inventory. As you can see by the second chart below, all other categories show reduced or stable supplies when compared with prior years. This trend is expected to continue as foreclosures and short sales, most of which fall into this segment, continue to work their way through the market from listings to closed sales. 

Conditions remain favorable and improving for sellers willing to price to the current market, and for buyers looking for unprecedented opportunities. Contact Greg Gorman or David Burke for information that is specific to your areas of interest.

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