NABOR: Naples area home sales slowed in November

Home sales in the Naples area fell in November, as the overall market continues to recover from Hurricane Irma.  Total sales declined by 9 percent over the year to 521, according to the latest report by the Naples Area Board of Realtors.  The report tracks all sales made by its members in Collier County through the Southwest Florida multiple listing service, excluding Marco Island.

Sales have been up and down since September, when Irma wreaked havoc on Collier County and put most Naples area Realtors out of circulation for two to three weeks.  Single-family home sales increased 1 percent over the year in November, reaching 271. However, condo sales fell 18 percent to 250.  Pending sales — or new contracts written — rose slightly over the year, growing by 2 percent to 728.  The inventory of homes on the market was down 7 percent in November, when compared to a year ago. There were 5,322 active listings, down from 5,733 last year.

Irma led some sellers to take their homes off the market. Some properties have not been relisted because they’re waiting on repairs, or their owners have changed their minds after getting new roofs or other upgrades due to the storm.

Buyers and sellers have good reason to be confident as there are many positives on both sides of the fence.  Sellers should get their properties on the market now and buyers should move quickly as multiple offers could occur as a result of the tight inventory.

A tighter inventory is pushing prices up. The median closing price — the price at which half the homes sell for more and half for less — rose 9 percent  to $330,000 in November, up from $303,000 a year ago.  There were 116 cash sales for homes priced below $300,000 in November.  This was higher than expected and may indicate the return of investors to the market.

While sales activity was down in November, local brokers say the demand for million-dollar homes continues to be strong.


Sales in the $2 million and up price segment increased 21 percent for single-family homes and 22 percent for condominiums over the year.

November had a 63 percent increase in pending sales for single-family homes over $1 million. This is a clear indication that high-end buyers continue to find Naples a desirable location for an investment.

To learn more about the Naples real estate market contact an expert member of the 9 Core Realty Team.




Foreign Buyers Investing Big in Florida Homes

Florida again is the top market for foreign buyers of U.S. residential real estate, with the state’s share at 22 percent. The North Port-Sarasota-Bradenton metropolitan statistical area ranked fifth for foreign buyers among Sunshine State markets.

The dollar amount of that international investment in home and condominium purchases continues to skyrocket, rising in the 12 months ending in July 2017 at $24.2 billion, some $5 billion more than the previous year, according to a report from the Florida Realtors trade group.

Within the state, the annual study put the Miami-Fort Lauderdale-West Palm Beach statistical was in a very strong first place, with a 52.6 percent market share, up a half percentage point from last year.

Orlando-Kissimmee-Sanford was a distant second place at 10.8 percent, down from 11.5 percent year over year, according to the survey conducted by the National Association of Realtors for the state organization.

North Port-Sarasota-Bradenton’s market share was 4.7 percent, 1.5 percentage points above last year. The Punta Gorda statistical area rose a smidgen to 1 percent, landing in 12th place, while The Villages, the huge master-planned community south of Ocala, was in 20th, stuck at 0.1 percent.

Foreign buyers purchased 61,300 residential properties, 15 percent of the overall Florida market. That compares with 47,000 and 12 percent the previous study period. Nationally, international buyers accounted for 5 percent of existing-home sales.

The Realtors report credits Latin American and Caribbean residents with the largest portion of Florida foreign buyers at 34 percent, down from 39 percent the previous year. Canadian buyers increased to 22 percent, from 19 percent in 2016. Other countries remained consistent year-to-year: Europeans were unchanged at 23 percent; Asians were 10 percent; and African buyers were 1 percent.

Of the total international buyers in North Port-Sarasota-Bradenton, 37 percent hailed from Europe and 36 percent from Canada.

To learn more about investing in Florida real estate, contact a member of the 9 Core Realty team!


How the ‘generational disruption’ of millennials is shifting real estate in Central Florida

The “generational disruption” unfolding today is of historic significance. The second wave millennials coming of age coincides with a transformation in the norms of life, work and society at every level.

The demographics of the millennial generation reveal they are the largest consumer group in U.S. history. There are currently some 75.4 million millennials (born between 1980-1997). That means a significant number of today’s real estate decisions, as well as those connected to the workplace, are made by people younger than 40 years of age.

Millennials are well-known for their love of cities and the ability to live, work and play in a single urban


area. But while this ethnically and racially diverse generation is postponing marriage and children, they are not putting it off indefinitely. In fact, 60 percent expect to live in detached single-family homes within the next five years. Real estate developers, investors, owners and builders must have a good grasp on location preferences, design and amenity features, and technology advances.

With readily developable land in Central Florida and great infill sites in our bedroom communities, suburban upgrades are being undertaken with mixed use, creating dense groupings of retail ventures, businesses, luxury condos/apartments and great communal spaces and evolving amenities. These types of live/work/play options also become viable alternatives for baby boomers to use for transition out of their primary residences as it becomes necessary.

Metro Orlando is seeing forward-thinking developments like Lake Nona that are designing creative, modern and collaborative communities and workplaces with the benefits of an urban setting. We can also look to Maitland City Centre, Ravadauge and Up Development on U.S. Highway 17-92 and Lee Road. And we can’t leave out the beautiful redevelopment of our suburban communities, such as what has been done in Winter Garden, DeLand and Sanford. It cannot be disputed that many millennials will live in cities their entire lives, but this is no different than previous generations. The difference is the size of this young generation is impactful for wherever they choose to live.

Millennials also are disrupting office space use. Building owners must be able to offer collaborative, flexible environments and make suggestions for customizable furniture and interior designs. The big challenge facing owners of older buildings is how to manage operating expenses with this flexible work population. This is a significant impact on utilities, security and maintenance, because millennials no longer work just 9 to 5. Will the rents increase to a level that can offset these impacts? All of this potentially affects the building value. Also expected are gyms, game rooms and smart-building technology. We also need to further explore capital costs to modernize building systems to accommodate this expanded use and keep these buildings as an option for the millennial generation. The long-term effect is going to be a change in how we conduct our real estate business.

By 2025, 75 percent of the workers in the world will be millennials. Their generational disruption is larger than any we’ve seen before — and everyone must learn to adapt. It’s an exciting time to be in commercial real estate and I can’t remember a similar period when every standard we believed to be true is now no longer so.

To learn more about the future of the real estate market in Florida contact a member of the 9 Core Realty team!

US new home sales surge unexpectedly, hitting 10-year high in October

Sales of new U.S. single-family homes unexpectedly rose in October, hitting their highest level in 10 years amid robust demand across the country.

The Commerce Department said on Monday new home sales increased 6.2 percent to a seasonally adjusted annual rate of 685,000 units last month. That was the highest level since October 2007 and followed September’s slightly downwardly revised sales pace of 645,000 units.

New home sales have now increased for three straight months.

That together with last month’s increase in homebuilding and sales of previously owned homes suggests the housing market could be regaining momentum after treading water for much of the year. Housing has been constrained by shortages of homes for sale, skilled labor and suitable land for building.

Activity was also temporarily restrained by Hurricanes Harvey and Irma. Housing has been a drag on economic growth since the second quarter.

September’s new homes sales pace was previously reported at 667,000 units. Economists polled by Reuters had forecast new home sales, which account for 11 percent of overall home sales, falling 6.0 percent to a pace of 625,000 units last month.

New home sales, which are drawn from permits, are volatile on a month-to-month basis. Sales surged 18.7 percent on a year-on-year basis in October.

Last month, new single-family homes sales soared 30.2 percent in the Northeast to their highest level since October 2007. Sales in the South increased 1.3 percent also to a 10-year high. There were also strong gains in sales in the West and Midwest last month.

More than two-thirds of the new homes sold last month were either under construction or yet to be started.

Despite the rise in sales in October, the inventory of new homes on the market increased 1.4 percent to 282,000 units, the highest level since May 2009.

At October’s brisk sales pace it would take 4.9 months to clear the supply of houses on the market, the fewest since July 2016 and down from 5.2 months in September. A six-month supply is viewed as a healthy balance between supply and demand.  To learn more about the state of the US real estate market contact a member of the 9 Core Realty team.


Foreign purchases of Florida real estate grow to $24B

Florida remained the top destination of foreign buyers purchasing U.S. residential real estate in 2017, with 22 percent of all foreign buyers who bought residential property in the United States. Florida Realtors latest report, the 2017 Profile of International Residential Real Estate Activity in Florida, finds that international sales hit $24.2 billion this year, up from $19.4 billion in 2016.

The economic environment created a mix of opportunities and challenges for Florida’s foreign buyers in 2016 and 2017, according to the report’s analysts. Latin American countries faced political and economic difficulties and weaker currencies in the wake of the collapse in oil prices. Meanwhile, economic growth strengthened in Canada and the Canadian dollar stabilized against the U.S. dollar.

House prices rose in the United States, including in Florida, but the appreciation was modest compared to home price appreciation in Canada. Amid these challenges and opportunities, overall foreign buyer purchases of Florida residential property increased: the share of buyers from Canada rose, the share of buyers from Latin America and Europe declined and the share of buyers from Asia and Africa remained unchanged.

The report is based on an annual study done by the National Association of Realtors (NAR) in cooperation with Florida Realtors. It presents information relating to residential transactions with international clients of Florida’s Realtors as well as information on U.S. clients seeking to purchase property abroad during the 12-month period of August 2016-July 2017. In this report, the year 2017 refers to the 12-month period August 2016–July 2017, and the year 2016 refers to the period August 2015–July 2016. A total of 6,551 Realtors responded to this year’s survey, conducted Aug. 7-Sept. 9, 2017.

The survey considers only residential purchases in the state.

Report highlights

  • Foreign purchases in the state increased to $24.2 billion, a $4.8 billion increase from 2016’s $19.4 billion.
  • Foreign transactions accounted for 21 percent of Florida’s residential dollar volume of sales, a 2 percent increase year-to-year. Nationally, foreign buyers comprised 10 percent of the dollar volume of existing sales.
  • Foreign buyers purchased 61,300 Florida properties (47,000 in 2016), which made up 15 percent of Florida’s residential market (12 percent in 2016). Nationally, foreign buyer residential purchases accounted for five percent of existing-home sales.
  • The median purchase price paid by foreign buyers increased to $259,400 ($252,500 in 2016), which was in line with the overall increase in Florida prices.
  • The median price paid by foreign buyers was 18 percent higher than the median price paid by all Florida buyers.

Nationalities of Florida’s foreign residential buyers

  • Latin American and Caribbean buyers accounted for the largest portion of Florida foreign buyers (34 percent), though this group made up 39 percent the previous year.
  • Canadian buyers increased to 22 percent (19 percent in 2016).
  • Other countries remained consistent year-to-year: The share of European buyers was unchanged at 23 percent; Asian buyers at 10 percent; and African buyers at one percent.
  • Most foreign buyers were concentrated in five metropolitan areas: Miami-Fort Lauderdale-West Palm Beach (53 percent); Orlando-Kissimmee-Sanford (11 percent); Tampa-St. Petersburg-Clearwater (nine percent); Cape Coral-Fort Myers (six percent); and North Point-Sarasota-Bradenton (five percent).

Transaction details

  • 72 percent of foreign buyers made an all-cash purchase.
  • 68 percent of foreign buyers purchased residential property for vacation, residential rental or for both uses (72 percent in 2016); 49 percent bought a townhouse or condominium (52 percent in 2016).
  • 35 percent (40 percent in 2016) purchased in a central city/urban area; 15 percent purchased in a resort area (14 percent in 2016).
  • 93 percent of foreign buyers visited Florida at least once before purchasing a property (92 percent in 2016).

Florida clients searching properties abroad

  • 17 percent of Florida’s Realtors said they had a client seeking to purchase property abroad, up from 14 percent in 2016.
  • Top countries of interest from Florida residents looking elsewhere: Colombia, Costa Rica, Spain, Canada and the Dominican Republic.
  • 75 percent were interested in residential property (79 percent in 2016).
  • 75 percent intended to use the property for vacation, residential rental or both uses (84 percent in 2016).

Florida’s Realtors interaction with international clients

  • While international business rose, fewer Realtors in Florida (44 percent) said they worked with an international client in 2017 (48 percent in 2016).
  • 61 percent of Realtors said they did not have cultural and language problems.
  • Personal contacts, previous clients and business contacts accounted for 72 percent of referrals or leads.
  • An agent’s firm, franchise website or social media was the primary source of online leads, followed by other aggregator websites and®.
  • Respondents were evenly split about the outlook in the next 12 months: 43 percent expected the same or an increase in international clients, 42 percent expected a decrease, and 15 percent had no opinion.
  • 56 percent expect foreign retirees to be potential clients.

To learn more about investing in Florida real estate, contact an expert member of the 9 Core Realty team.

Preparing for new homes, neighborhood at Babcock Ranch

Homebuilder, Pulte is getting ready to build its first inventory home in Babcock Ranch. It’s just the beginning of their plan to build more than 135 homes in that community. The Arbordale will be an unfurnished inventory home constructed in the Lake Timber neighborhood.

That is the reality — the dynamic need — people want to move in right away. With models, by the time you design the house and pick the options it takes longer. Having inventory homes for people to move in right away adds to the velocity.

The three-bedroom, two-bathroom Arbordale spans 1,980 square feet under air and is priced starting in the upper $200,000s.

One of the things that make this model right for Babcock is that the garage is in the back leaving more room in the front for a porch. A trademark of homes in Babcock are front porches that facilitate the idea of a neighborhood and neighbors meeting neighbors. The other thing that is great is the proximity to the town center.

The initial plans are to introduce four floor plans in the Lake Timber area. The four plans range from 1,758 square feet to 3,293 square feet. There are both one- and two-story options. Currently there are plans for six homes in that section but they might expand and add more sites if the product is successful.

To learn more about investing in Babcock Ranch, contact an expert member of the 9 Core Realty team!

Housing market at a regulatory crossroads

With home prices and sales continuing to rise across Southwest Florida, the state and the country, the real estate market appears set for a sunny future.

The talk in some quarters, though, brings up worries that another housing bubble could be developing, conceivably bursting into a runaway fire that scorches the economy again.

As unlikely as that is, some powerful political and business interests are bent on repealing some of the regulations on the financial sector that were adopted in the midst of widespread abuses in the banking and investment markets that beget the Great Recession.

September’s report by property data aggregator CoreLogic once again reflects a steady climb in housing prices. August figures compared with the same month last year show the national increase at 6.9 percent, Florida at 6.2 percent and Sarasota-Manatee at 3.9 percent. CoreLogic projects Florida’s home values will increase 6.6 percent over the next 12 months as the country’s rate rises by 4.7 percent. The company’s chief economist, Frank Nothaft, said that during the past three years, CoreLogic’s national index shows annual price growth from 5 percent to 7 percent. Home values in Florida still stand at 18 percent below pre-recession peaks.

One potential sign of trouble in the report is CoreLogic’s analysis of the country’s 100 largest metropolitan areas: 34 percent have overvalued housing stock as of August 2017. Of the 50 largest, 46 percent have an overvalued housing stock. The analysis defines “an overvalued housing market as one in which home prices are at least 10 percent higher than the long-term, sustainable level … .”

The histories of the savings and loan crisis of the early 1990s and the Great Recession should serve as lessons in disaster prevention, not a road map to replay. The similarities between the causes of the S&L crisis and the financial crisis of 2007–2008 and the U.S. subprime mortgage crisis of 2007–2009 should not be startling, but demonstrate that we do indeed repeat history.

To learn more about the current state of the real estate market in SWFL, contact an expert member of the 9 Core Realty team.