So thanks for watching, if you have any questions about these market statistics, we're here for you and happy to talk.
Lee County Market Update
Click here to watch Mike's Lee County Market Update, a review of what happened in the real estate market in April 2023!
Hi, this is Mike Darda with Compass Florida Realty in Fort Myers and Cape Coral giving you your May 2023 market update for Lee County, Florida.
We're going to start, as we usually do with the home sold report. In April of 2023, we saw 963 homes close escrow compared to April of last year, where 1,390 homes closed escrow. That's a decrease of 44%. And what has been causing that is the interest rates.
The next set of statistics we're going to talk about is the active listing. In April of 2022, there were only 1,105 homes on the market, making the market have very few homes for buyers to choose from and a strong seller's market. Right now, we actually are seeing in 2023, 2,905 homes for sale, a 163% increase. So buyers are definitely seeing a lot of more homes to choose from now, which is making it more of a neutral market.
Average sale price are reflecting this neutral market territory where prices aren't really going up or down very much. In 2022, the average sale price in Lee County was just under 400,000 at $399,999. Right now in 2023, that average sale price is $399,450. So you can see that with a neutral market that we're in now, about a three-month supply of homes out there is that we're actually seeing prices kind of holding at the moment.
Interest rates are what has created that massive drop in the number of sales. Interest rates right now are 6.43%. That is roughly a percent higher than it was a year ago. And we know that every time rates go up 1%, it decreases a buyer's purchasing power by 10%. So that is why we're seeing fewer buyers in the marketplace.
So now we're going to cover some area points that are interesting that are happening here in Lee County. Cape Coral has just announced that the Hudson Creek community has gotten preliminary approval from the city of Cape Coral. This is a huge section of land east of Burnstore Road in North Cape Coral. It's 3,500 units of residential, retail, and apartments. There's still no timeline as to when the project is going to be off the ground. They're still in talks about permits and zoning and utilities, but that segways nicely with the Burnstore Road expansion that is now complete. The two-lane expansion is all finished. It's been a long multi-year project, so we're glad to see that done.
And the Cape Coral Museum. If you're looking for some fun, Cape Coral Museum of History is hosting a brew fest with food and performers to raise money for the museum.
In Fort Myers Beach, the restorations are continuing from the hurricane. One of the restorations they're doing is to restore the beach, replenish the beach, and they're going to have elevated sand levels. And, of course, who's going to like that the best are the turtles. They're going to have safer habitats because turtle season is just starting here on May 1.
It’s a common misconception that only those who are wealthy or are in the real estate industry can invest in real estate, or that in order for it to make sense, you have to own multiple properties at the same time. All of these are unfortunate misconceptions.
In fact, anyone can get started investing in real estate, even when they are purchasing their first home with an FHA mortgage. All investing really takes is having the right mentor to guide you through the process, and walking you through potential outcomes of every decision.
Real estate investing is one of the most profitable and rewarding ways to invest your money. The real estate market has been one of the most stable and reliable investment options for decades. So, let’s take a look at what investing in Florida’s prime real estate market can do for you!
What Does it Mean to Invest in Real Estate?
Investing in real estate means buying, owning, and managing properties to generate a profit. Real estate can be a long-term investment, where you hold the property for years and earn income through rent or lease payments. Alternatively, you can also invest in short-term opportunities, where you buy, improve, and then sell the property for a profit.
There are also different types of homes you can build your real estate portfolio with, and that determines what type of clientele you typically will rent out to, as well as the areas you will mainly purchase homes in. If you choose to primarily rent out to families, you will most likely begin building your portfolio with single family homes, in a good school district, with shopping near by, and in a younger area. If you live in a heavily-vacationed area, you most likely will want to invest in homes that are fit for AirBnB’s or VRBO’s. This means either single family homes or condos that are probably not in an HOA and require low maintenance. Finally, if you live in an area that has a lot of part-time residents, similar to Southwest Florida, you may want to consider a seasonal rental. These range from single family homes to condos, and rent for shorter periods of time, but for more money.
Real estate investing can be a great way to generate passive income, diversify your portfolio, and build wealth over time. Real estate investing can also be an excellent way to protect your wealth, as it is often less volatile than other investment options.
How to Get Started Investing in Real Estate
Getting started in real estate investing can be challenging, but it is not impossible. Here are some steps to follow to start investing in real estate:
Before investing in real estate, it is important to educate yourself about the market and the process of investing. There are many resources available online and in print, such as books, podcasts, and webinars, that can help you understand the basics of real estate investing.
Set your investment goals
Define your investment goals and determine what type of real estate investing you want to pursue. Are you looking for short-term or long-term investments? Do you want to invest in commercial or residential properties?
Determine your budget
Real estate investing requires capital, so it is important to determine your budget and how much you are willing to invest. You may need to consider financing options, such as loans, to fund your investment.
Find a real estate agent or broker
A real estate agent or broker can help you find properties that meet your investment goals and guide you through the process of buying and selling.
Once you have identified a real estate agent or broker, start researching properties in your target market. Look at market trends, demographics, and property values to find properties that are likely to appreciate in value over time.
Have you wondered what your future could look like if you started investing in real estate? Want help building a business plan in real estate investing? Our team has helped hundreds of investors across Lee County. Call us today to learn more.
How Has Technology Impacted the
Real Estate Market?
The real estate industry has undergone a significant transformation in the past decade due to technological advancements. From virtual tours to online mortgage applications, technology has revolutionized the way we buy and sell properties. Here are just some of the impacts of technology that buyers and sellers are seeing when they are in their real estate process.
Improved Access to Information
Technology has made it easier for buyers and sellers to access information about properties. Today, anyone with an internet connection can browse real estate listings, view photos, and even take virtual tours of properties from the comfort of their own home. This means that potential buyers can quickly and easily research properties before making a purchase, which can help them make more informed decisions.
Another impact of technology on real estate is increased transparency. In the past, real estate transactions were often shrouded in secrecy, making it difficult for buyers and sellers to understand the process. Today, however, buyers and sellers can access more information about properties and the real estate market, which has made the process more transparent. This has resulted in more informed buyers and sellers, which has led to more successful transactions.
Finally, technology has revolutionized real estate marketing. With the rise of social media and online advertising, real estate agents can now reach a wider audience than ever before. Additionally, many agents now use virtual staging and 3D rendering to create virtual tours and marketing materials that showcase properties in the best possible light. This has led to more successful marketing campaigns and more effective property sales.
Technology has made it easier for buyers and renters to visualize properties before physically visiting them. Virtual and augmented reality (VR/AR) technologies allow buyers to take virtual tours of properties and see 3D models of them. This not only saves time but also allows buyers to get a better id
ea of the property's layout and features before visiting it in person.
More Secure Transactions
Technology has made real estate transactions more secure. With the use of blockchain technology, transactions can be securely recorded and stored in a decentralized ledger, reducing the risk of fraud and ensuring that data is tamper-proof. This enhances trust between buyers and sellers and reduces the risk of disputes.
In conclusion, the impact of technology on real estate has been significant. From increased efficiency to improved marketing, technology has transformed the way we buy and sell properties. As the industry continues to evolve, it is clear that technology will continue to play a critical role in its development
Lee County Market Update
Click here to watch Mike's Lee County Market Update, a review of what happened in the real estate market in April 2023!
We're actually going to do things a little differently this month and we are going to make averages for the whole county so you can see a better picture of what is going on in our community. We're going to start by kicking it off with the homes sold report. The number of homes sold in March of 2022, last year was 1,394, compared to this year in March, 1,083. So what we have is a rate of change of a decrease of 22%. So the actual reason for that in part is the rising interest rates.
If we take a look at interest rates, they've gone up approximately 2% over the course of the last year. Every percent that interest rates goes up, it drops the buyer's purchasing power by 10%. So that's a lot of what we're seeing here in terms of reduced number of transactions; there's just less buyers that are able to qualify.
The next thing we're going to look at is the active inventory report. Last year there was 722 properties active on the market, that's everything, single family homes and condos. Right now in 2023, we actually have 2,811. So that's 4 times the number of properties that buyers have to choose from.
What's causing that is the fact that we have that drop in the number of sales. So homes are taking longer to sell and they're sitting on the market, which means we have more inventory. With more inventory available, buyers are not in as big of a hurry to make offers because they have more homes to choose from. This is causing homes to sit on the market a little longer than they used to and even some motivated sellers to speed up the process. We're seeing some price reductions occur.
Let's talk about the average sale prices. Last year at this time, the average sale price of homes was $399,999. This year, it's dropped slightly to $390,000, a difference of just 2%. What you're seeing there is essentially we're not really in a buyer's market or a seller's market. We're in what we call a neutral market. And pricing is stable, not really going up or down drastically, which is good, and a lot of people actually prefer to be in a stable market.
Let's look at interest rates. They are currently at a 6.32% interest rate versus last year at this time, which was at a 4.67% interest rate. These rates are also causing some sellers to look at their current interest rate on their home and say “I've got a two and a half or 3% rate, there's no way I'm going to sell my house.” This has caused some sellers that may want to get their homes on the market to actually hold tight at this time.
There's a lot of exciting things happening here in the Lee county area, one of which that a lot of buyers are noticing once they move here is the traffic has definitely increased quite a bit, not just seasonal, but now year round as our population is growing. So everyone I know that commutes from Cape Coral to Fort Myers is very excited about the widening of the Cape Coral Bridge. This does not have an official start date yet, but it will go from the current four lanes, they're proposing six lanes plus bike and pedestrian pass. And everybody can't wait for that one to come fast enough.
Cape Coral Parkway is a main corridor, and has a lot of traffic on it, and there's about to be more. We have the Cove at 47th, a luxury apartment complex that is currently under construction with 327 doors to be finished by fall of 2024. We also have the Bimini Basin project that's going to add 220 doors. Just down the street up in North Cape, the Festival Park is coming that's got multi-use fields. It's located between Chiquita and Nelson Road, and Hurricane Ian slowed the progress on that a little bit. But that's an exciting North Cape project that should be finished this year.
In Fort Myers, the big story has just been actually how tourist season was really nonexistent this year. It was a very slow tourist season, the slowest spring break tourist season specifically. And of course, a lot of that is because of the beaches being under reconstruction right now. And there's just not as much for those tourists to do. So they picked other areas.
Now, Margaritaville is one of the exciting parts of Fort Myers Beach that is scheduled to be finished by the end of 2023. And they are making some great headway on that project. In fact, they've just bought more land to even expand it further.
So a lot of exciting things are happening in our market. We thank you for watching our video for this month. And if you have any questions and you're wondering how all this affects your buying or selling real estate, call us. We're here for you and thrilled to talk to you. Thanks for watching.
Cape Coral & Fort Myers Market Update
Click here to watch Mike's Lee County Market Update, a review of what happened in the real estate market in March 2023!
Sold Homes Statistics
According to the Royal Palm Board of Realtors in Cape Coral, 357 single family homes and 45 condos sold in the month of February in comparison to February last year, when 607 single family homes and 65 condos were sold. This shows us that there has been a 41% decrease in the number of single family homes sold in Cape Coral between now and then, and 31% decrease in the number of condos sold in Fort Myers during the month of February, 169 single family and 195 condos sold in comparison to February last year, when 189 single family homes and 249 condos sold. This shows us there's been an 11% decrease in the number of single family homes sold and a 22% decrease in the number of condos sold.
Active Homes Statistics
Now let's move on and discuss the number of active listings in Cape Coral. By the end of February, there was 1356 active single family homes and 232 active condos. Last year at this time, there was 460 single family, single family homes and 44 condos listed. In Fort Myers, there was 388 single family homes and 537 condos in comparison to last year, there was 134 single family homes and 103 condos. As you can see, the number of active homes in Lee County has actually increased by an average of 50% and we've shifted from a seller's market just a year ago to where we only had a couple of weeks of inventory to a neutral market with a four month supply. This shift has also led to longer days on the market for nearly all homes. Fort Myers, the average days on the market for February is 16, whereas last February it was six. And in Cape Coral, the average days on the market is 32, last year was just six. This is an average increase of 71.5%.
Price Trending Statistics
Before we discuss why, let's look at the prices of homes in Cape Coral and Fort Myers, and to give you an idea, Cape Coral, the average sale price for a single family home in February of 2023 was approximately $420,000. A year ago, that was $401,000. That's a 5% increase in terms of Cape Coral condos, the average sale price in February was of 2023 was 294,900, and a year ago was 268,500, an increase of 9%. Moving into Fort Myers, the average sale price of a single family home in February 2023 was 455,000, as wherein February 22 it was 430,000, an increase of 5.5%. And condos went from 300,000. This February, it was only 273,000 last year, an increase of nearly 9%.
So the bottom line is, as the statistics show, there are more homes for buyers to choose from. Fewer home sales are occurring, homes are taking longer to sell, but home prices are actually up year over year. Now that you've seen what's happening in the market in the last month, let's take a look at some of the other factors in the real estate market.
First, let's look at interest rates. According to Freddie Mac, a 30 year fixed rate loan right now is 6.5% percent. What this means is buyers purchasing power has decreased as the interest rates rose. Home buyers that are able to afford now less home, which means they will definitely have longer days on the market for the homes that are up for sale. This has caused the market to shift from a seller's market, where sellers dictated pricing, to where we now have a neutral market. And if it continues to stay a neutral market, which is about a four month supply of homes, prices will remain steady.
Hurricane Ian and the FEMA Rule
As we continue to pick up the pieces from Hurricane Ian, severely impacted homeowners are considering whether to rebuild their homes or sell as is. One of the main factors that is impacting this decision is the FEMA rule. This rule states homeowners are able to repair or remodel their structure for up to only 50% of the assessed value of their home. And that's just the structure. So if your home is worth $500,000 the structure and you could repair it up to 250,000, this doesn't apply. Of course, if you tear down the property and build a new home, we are, as a result of all this, seeing an influx of investors who are looking for these homes to buy and renovate or to tear down and build new.
Everyone either knows someone in real estate, or has an opinion in real estate. When you are in the market to either purchase or sell your home, you are probably going to get polar responses to the same question. For example, if you ask whether it is worth it to stage your home or sell it as is, you will probably hear “NO! Don’t waste your time or money on staging” but in the same day, “Yes! You absolutely need to stage your home, it’s totally worth the money!” The answer is; both are perfectly acceptable answers. At the end of the day, buying and selling your home is a unique experience to each person. Here at the Darda Group, our 5 secrets to real estate have nothing to do with the homes themselves. In fact, it’s more about your knowledge than anything else. So allow us to introduce to you; the 5 secrets to being successful in real estate.
1.Location is key - know what your price range is and how zip code can impact the overall price of a home.
When beginning your search in real estate, knowing where you want to buy a home is by far one of the most important aspects of purchasing a home. Things such as population growth rate, average home prices, job availability, and school districts, vary drastically based on zip code. So before you begin seeing homes, make sure you know the area you want to purchase a home in so your real estate agent and lender can make sure they send you homes that fit your price range and fit all of your needs.
2.Find trustworthy real estate experts - working with a real estate agent who has experience in the market you are looking in can drastically improve your real estate journey.
Ask yourself, when was the last time you hosted an open house, or dialed hundreds of phone numbers, or door knocked a community, or prepared a marketing campaign? If you are like most, the answer is you probably can’t remember a time of ever having to do any of those things, let alone all of them to buy or sell a home. That’s why partnering with a real estate expert in your area puts you miles ahead of the competition or doing it on your own. According to the National Realtors Association, 86% of homes were sold on the Multiple Listing Services, which is a site that is only accessible by real estate agents. What this means is that you are much more likely to sell your home by having access to the MLS, which is only available by working with a real estate agent. When purchasing a home, according to the National Realtors Association, you increase your chance of finding the perfect home for you by 49%. What this tells us is that you wouldn’t perform surgery on yourself, you would go to the best surgeon you can find for your procedure. So just like in real estate, partner with the best agent to help you meet your real estate goals.
3.Do your research - understand the current economic, job, and housing markets and how that can impact what you can afford.
We all saw what happened to the real estate market in 2020. It was the record setting year in the entire history of real estate. And it massively impacted each and every person, whether they are purchasing a home, selling a home, or even renting. The pandemic was not the only factor in the massive real estate boom. The economy plays arguably the largest role in factors of a real estate market. The housing market is directly related to the United State’s GDP. What this means is that if the GDP begins to take a dip, and the value of a dollar decreases, then the value of real estate will also decrease. The job market can also impact the real estate market in regard to job availability and minimum wage levels. For example, here in Southwest Florida, there are 4 major companies that have headquarters here; Chico’s, Hertz, Arthrex, and Gartner. Having headquarters in cities with competitive wages can increase the cost of living in cities because people will move to those areas just to work at those companies. So understanding what jobs are available in your desired cities can allow you to plan for the future and understand what the cost of living is for that area. Lastly, understanding the housing market is of course extremely important when selling or purchasing a home. Overall, building a base knowledge with these 3 indicating factors will help you reach your goals in real estate.
4.Get your finances in order - make sure you have a budget and that you can afford the property you’re looking at.
Real estate really needs its own dictionary. Common terms said by experts are equity, line of credit, discount points, appraisal contingency, or escrow payment. All of these terms have one thing in common; they directly impact the money you either put in your pocket or take out when buying or selling a home. One of the best things you can do for yourself is partner with a mortgage lender or real estate attorney who has vast knowledge and expertise in the world of money in real estate. Set a budget prior to meeting with these people, and research the right questions to ask them to make sure you understand exactly what is happening with your money. Their jobs are to make sure you make the best, most financially sound decisions for yourself and that you have set yourself up for success in the future.
5.Look for the long-term - don’t just focus on the short-term gains, think about how the investment will benefit you in the long run.
As mentioned before, real estate is a long term game. According to the New York Times, the average time a person owns a home is 13 years. Imagine working in, driving in, or eating in the same place every day for 13 years? You would want it to be perfect. We all know that there is no such thing as perfection when it comes to purchasing a home. Most people end up purchasing a home that they feel is great for them now. Our expert advise would be to think about yourself in the next 2,5, and 10 years. Do you think you will want to move out of the area? Do you plan on going to school? Do you want to start a family? Are you in a career that you are passionate about? Are you partnered with the right people? All of these questions can help you begin to think in the long term. It is ok to make changes to your home and lifestyle as time moves forward, but always remember that this is a long term investment and think how these changes can impact the value of your home. Homes are not like cars where they depreciate overtime. Home prices can fluctuate month to month, and any structural or cosmetic changes can impact that price. So again, always think in the long term in real estate
These 5 secrets to real estate are the stepping stones, the foundation, the basics of real estate. Partnering with trusted and knowledgeable real estate professionals can help you navigate each aspect of the real estate market and get you across the finish line of success. Interview agents and work with the group who you know can help you succeed.
Lee County Market Update
Click here to watch Mike's Lee County Market Update, a review of what happened in the real estate market in February 2023!
Homes Sold in January
Just last month in Cape Coral, there were 339 homes sold and closed. Whereas a year ago in January 2022, 554 homes were sold. That's a nearly 40% decrease in the number of homes sold. In Fort Myers, there were 278 homes sold in January of 2023. And a year ago, January 2022, there were 395 homes sold, making it a 30% decrease in the number of sales. What these numbers mean is that we're returning to a balancing market. Buyer demand has actually begun to shift downward, which means that homes are staying on the market for a longer period of time, and we call that days on market. This is also affecting the sales price of homes. Back in January of 2022, homes were being priced according to the market, or what the market was telling sellers, and they were selling quickly because of high buyer demand. Well, in January 2023, sellers are still pricing their home as if the market was still at its all time peak. This is leading to longer days on the market, more room for negotiations, more price reductions, and ultimately less overall home sales.
Active Listings in January
So now let's shift gears and look at the next report that I'm going to pull up here, and that is our active listing report. This gives you an idea of how many homes are currently for sale at any given time in the market. We closed out January 2023 with 1,558 homes actively listed in Cape Coral and 846 actively listed in Fort Myers. In comparison to January, 2022, there's actually about three times the number of homes for sale now versus a year ago. So the fact reaffirms that the Southwest Florida real estate market is beginning to balance out.
This also shows us that buyers are beginning to be more selective about homes that they're purchasing. Back in 2022, buyers had little inventory. They were more willing to overlook important details when purchasing homes, such as waiving inspection rights or giving up on square footage. And now buyers have more selection available. They're being particular about the homes they're purchasing. This may lead sellers having to repair and stage their homes more to appeal to a wider range of buyers. Whereas in the past, sellers could sell their home with virtually no improvements and guarantee a sale.
Next, we'll discuss interest rates. According to Freddie Mac, the current interest rate for a 30 year fixed loan is 6.13%. As seen on the graph, this is actually the first time in a while that we've seen a significant steady decrease in interest rates. The peak was back in mid November, with an interest rate of just over 7%. So this may lead to a few changes in the real estate market because rates are still about double what they were a year ago. And this is one of the reasons we're starting to see a decrease in the number of homes sold. Historically, for every 1% interest rates go up, buyers purchasing power actually reduces by 10%. That means they cannot afford as much house as they could a year ago when the rates were in the low 3% range. Therefore, with interest rates rising by 3% over this last year, buyers purchasing power has actually dropped by 30%.
It's also important to note that this purchasing power is impacted by wages. If a buyer's wages remain the same, then the buyer can afford less home. The inverse is true if a buyer's wage increases along with the increasing interest rates, buyers can actually afford the same amount of home. This would also mean that sellers would be able to negotiate in terms of the sale price of their home. However, as we stated earlier, with buyers being more selective and homes having longer days on the market, the market is still balancing even though rates are decreasing.
Post Hurricane Ian
Before we close out this month's real estate market update, I want to discuss the continuous aftermath of Hurricane Ian. Many homeowners across Florida are still facing that difficult decision whether to rebuild their hurricane damaged home or to sell it as is. But one thing that's beginning to impact everyone who's had hurricane damage is insurance. Many homeowners are facing extremely high insurance rates across the board. According to NPR, Florida homeowner insurance rates are rising at an average of 33%, whereas the national average is 9% increase.
The main reason for the massive increase in insurance rates is actually because Hurricane Irma homeowners who suffered damage in the massive storm five years ago entered into many lawsuits with their insurance companies over the "Assignment of Benefits" clause. What that means is they happen to pair up attorneys with contractors after the hurricane and they partnered together to raise the rate of each service. Now those litigations are coming to the forefront. It's forcing insurance companies to raise their overall rates. Another side effect of these lawsuits is the two largest insurance companies, Allstate and State Farm, are no longer writing policies in the state of Florida.
This is making it extremely difficult for homeowners to have a proper and effective insurance policy written for their home. And if they can find an insurance company, the prices are extremely high.
Even with the continuing impacts of the hurricane, we are still seeing sales of homes that have damage. So whether you have water or wind damage, there has been a high volume of hurricane damaged homes selling. In fact, the local Real Estate board and Zillow have begun to specifically market hurricane damaged homes as they are in a different bracket than normal home resales.
Lee County Market Update
January 2023 - Review of 2022
Click here to watch Mike's Lee County Market Update, a review of what happened in the real estate market in 2022!
Hi, this is Mike Darda with Darda Group and Compass Florida. Thank you for checking out our market update for January 2023 as we review 2022's real estate market.
Homes Sold in 2022
First, let’s review the number of homes sold in 2022 for Fort Myers and Cape Coral. In January 2022, there were 1,200 home sales, which increased by an average of 14% each month from January to April. In April of 2022, there were 1,741 homes sold. In November and December of 2022, the number of homes sold was averaging at 840 homes. Overall, there were 14,770 homes sold in Fort Myers and Cape Coral.
The next set of data we are going to review is the sale prices of the homes sold in 2022. The average sale price of homes in Fort Myers and Cape Coral was $381,000. Now this number stayed consistent throughout the entire year, with the highest month being June at an average sale price of $408,000.
Absorption Rate in 2022
Now, let’s take a look at the absorption rate over 2022. If you recall, absorption rate is the number of months it would take for all the homes currently listed to be sold. At the beginning of 2022, the absorption rate was roughly three to four weeks. What this means is that there were more homes selling than were being listed on the market, and when they would be listed, they sold very quickly. As the year went on, the absorption rate began to increase and we closed out 2022 with a 4 month absorption rate.
Interest Rate in 2022
Let’s move onto interest rates. This has been a major topic of discussion throughout 2022. Before we dive into the interest rates of 2022, we have to understand what made this such a remarkable year for home buyers.
In the middle 2020, the real estate market had begun to face an unprecedented shift in the number of sales. There were more homes sold at such a fast rate and at peak sale prices than ever seen before. That is because interest rates had begun to decrease at such astounding rates, and people were taking advantage of the market. This trend continued well into 2021, where home sale prices were still rising and interest rates were at all time lows. This caused a massive migration across the United States as people were starting to work from home more often, making it easier for them to choose the city they wanted to live in. According to the US Census, the Florida population increased by over 1.5 million people between July 1, 2021 and July 1, 2022. This was clearly shown here in Southwest Florida as new communities and developments were being built all over town.
Now as we have moved into 2022, interest rates had begun to steadily increase, as we started off the year with a 3.22% interest rate on a 30 year loan. This sudden increase in interest rates forced buyers to pull themselves out of the market. This caused sellers to either panic and pull their homes off the market, or attempt to gain more traction with decreasing their listing price, a tactic we hadn't seen in the real estate market for over 18 months. As the year continued, interest rates had jumped to 4.16% by the middle of March. If you recall back to the number of homes sold in 2022, this is when there was a sudden decrease in the number of homes sold in Fort Myers and Cape Coral, a clear correlation between interest rates and homes sold. Throughout the next months of 2022, interest rates continued to rise, finally hitting 6.02% in the middle of September. The highest interest rate we saw in 2022 was 7.08% in the end of October through the beginning of November. We closed out the year with a slight decrease in rates, at 6.42%.
Arguably, interest rate changes were the largest factor in the balancing of the real estate market in 2022. This resulted in a market where buyers were forced to be more selective with the homes they would afford. In an effort to sell their homes for the highest price, sellers then became more open to negotiations and potential contingencies of their sales.
What to Expect in 2023
Let’s now move into what we are expecting for 2023. In spite of interest rates and hurricane damage, initial signs are positive for the Southwest Florida real estate market.
Here at the Darda Group, we have seen an uncharacteristically high volume of buyer inquiries over the last few weeks of December, which is normally a relatively quiet time of the year. Resulting in a record for December of 33 new pending homes here with the Darda Group. The bottom line is that it still gets cold up north and sunshine sells very well this time of year.
As always, if you have any additional questions please feel free to respond to our email [email protected] or contact us here at the office at 239-542-2822. We are here to help!
Lee County Market Update
Post Hurricane Ian
Click here to watch Andrew's Lee County Market Update post Hurricane Ian!
Hi, this is Andrew Darda with Darda Group and Compass FL. Thank you for checking out our market update on the impacts of Hurricane Ian
As we pick up the pieces from Hurricane Ian, it’s hard to believe its only been a few week.
So many of our friends, families, and clients have reached out wondering; what is happening in the real estate market? What is the value of homes on the beach?
Well, we are here to say that there is a market for your home, no matter what condition your home may be in. If you plan on rebuilding your home, we have trusted contractors who are ready to help. If you plan on selling your home as is, we want to make sure you get the value you deserve. What’s most important is that you have all the resources you may need as we continue to pick up the pieces after Hurricane Ian. Please call us with all of your needs. Our team and clients have been impacted by this storm, so we know what you are going through.