Naples area Real Estate Market, all signs are up

I just love looking at an analyzing the data. You can't argue with it, it is what it is and in this case ending March 31, 2009 there are continued positive trends.

The first graph, below, are the pending homes at the end of each month for the past 24 months. THe end of this curve looks like it's rocketship propelled. It's not unusual to see an increase during the winter season in southwest Florida. In fact, you can see the positive ramp up in the middle the curve for last winter season. However, the steepness of the curve 12 months ago is nothing like this winter season. Why? Simple. Prices are down, volume is up.

The second curve are the actual closed sales for the past 24 months. It's plain to see that the lever the previous months represents is clearly different, and much better, than the 12 months preceeding. The past 12 months show a monthly average improvement in closed sales by 43%! That's pretty good!

24 month pending home sales

24 month closed sales

Now, a fair question to ask is, why doesn't the closed sales trend track the pending homes sales trend? The simple answer is that far fewer contracts written actually close. The primary reason are short sales. Only about 10% of short contract close. Why? Buyer's perceptions are incorrect with the motivation for "the bank" to sell the property. In fact, the bank doesn't own the property until it is foreclosed. Once foreclosed, the close rate is much better. Enough on short sales, I don't intend this to be a tutorial on short sales.

The bottom line is that Naples real estate has always been in demand and it always will be. During 2005-2007 many buyers were priced out of the market. We're now selling property at 2003-2004 prices so for those in the right position this is the time.

For more about the real estate market in Naples or Bonita Springs / Estero, you can read my report and download the data on my website.