Home sales rose in Naples area last year, despite Hurricane Irma

Hurricane Irma made a dent on home sales in the Naples, Fla., area in the final months of 2017.

But total sales still came in higher than in 2016, which had its own set of challenges including economic uncertainty stirred up by a presidential election.

Sales rose 4 percent over the year to 8,815, up from 8,510 a year earlier, according to the latest report by the Naples Area Board of Realtors.

The report tracks resales, or existing home sales, made by the Realtor association's members in Collier County, excluding Marco Island.

Irma left its mark in the final months of the year.

In the fourth quarter, sales fell by 4 percent and the number of new contracts written declined by 2 percent over the year, which real estate experts attributed mainly to the aftermath of the hurricane during a market presentation Friday at NABOR's headquarters.

In December, sales decreased 1 percent over the year, with 657 sales made in 2017 compared to 663 in 2016.

The hurricane wiped out about a month of activity after it hit in September, so in essence, 2017 was an 11-month year for local agents, said Mike Hughes, vice president and general manager for Downing-Frye Realty Inc. in Naples.

"I was expecting 2017 to jump even more, but we had a lot of things on our plate," he said.

To bring home his point, Hughes held up front page headlines from the Naples Daily News leading up to the storm and after it, pointing out the severity of the hurricane, which put sellers, buyers and agents on hold as they waited for water and power to be restored, evacuees to return and a sense of normalcy to settle in after it passed.

"It seems like 2017 was a series of challenges," Hughes said. "Obviously the biggest impact to us was the hurricane."

Last year's bumps ranged from jitters over the election of a new president in the first quarter to uncertainty over the passage of a sweeping tax bill in the fourth quarter. Still, interest and activity in real estate remained strong, making for a good, but not great, year for area Realtors, Hughes said.

In 2017, pending sales — or new contracts written — rose 2 percent over the year. There were 9,121, compared to 8,903 in 2016.

"That's huge," Hughes said.

He described the trend with pending sales last year as "a story of two ends of the rainbow" for single-family homes. There was a 16 percent drop in the $300,000 and under market, but a 19 percent increase in the over $2 million segment.

For condominiums there were two "hot price ranges," Hughes said. The $300,000 to $500,000 segment saw a 14 percent rise in new contracts over the year, while the $1 million to $2 million category saw a 28 percent increase in activity.

Single-family home sales rose 2 percent year-over-year in 2017, increasing to 4,347. Condo sales were up 5 percent, growing to 4,468.

The "shining star" was condominiums in the $1 to $2 million segment, said Brenda Fioretti, managing broker at Berkshire Hathaway HomeServices Florida Realty in Naples. Pending sales rose 28 percent, while closed sales increased 14 percent year-over-year.

North Naples saw the most activity last year, with a total of 2,447 sales. That was a 6 percent increase from 2016.

While it's a smaller market, the over $2 million segment saw a 20 percent hike in sales over the year with 406 in 2017.

"We had a great year in 2017...and I can't really help but be optimistic...as we go into 2018," said Tom Bringardner Jr., president and CEO of Premier Commercial.

He's optimistic because employment is high, inflation is increasing slowly and the stock market is strong.

"We're in a period of synchronized global growth," Bringardner said. "Not only are things good in the U.S. and Southwest Florida they're pretty darn good globally."

The median home price — the price at which half the homes sell for more and half for less — rose slightly, growing 3 percent over the year to $330,000.

In December, the inventory of homes on the market was down 8 percent year-over-year — at 5,491.

Cindy Carroll, a partner in Naples-based Carroll & Carroll Appraisers and Consultants, said there's a 7.5-month supply of single-family homes on the market. She described the market as both solid and logical.

Naples, Fla.

The inventory of condos on the market fell by 3 percent over the year in December to 2,806. In the $1 million to $2 million segment, it dropped by 18 percent.

Geographically inventory shrank the most in the areas of Naples Beach, North Naples, Central Naples and Immokalee/Ave Maria, which all saw double-digit declines.

At the end of last year the $300,000 and under segment had the largest number of homes on the market — at 1,554. That was followed closely by the $300,000 to $500,000 category with 1,511.

With fewer homes in the $300,000 and under market than a year ago, price increases could follow, which won't help the affordable housing problem in Collier County any, Carroll said.

The oversupply of homes in some areas could be corrected by the end of season, bringing them back into balance, she said.

A six-month supply of homes is considered a balanced market between buyer and seller.

Changing architectural trends could hurt some sellers. Preferences are moving away from Tuscan to a more West Indies/modern style, which could impact the demand and prices paid for more elaborate luxury homes in the $1 million and up segments, where there is already an oversupply of inventory, Carroll said.

"De-Tuscanization is possible in some cases, but in other cases, it's not possible," she said.

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