Southwest Florida Real Estate Market Update [New for March 2023]
Less properties over $1 million across the US...except for in Florida? And how long, on average, do owners stay in their homes?
Hi, it's Marcus Larrea, team lead at Palm Paradise Real Estate, and here is your Southwest Florida Real Estate Market Update for March.
Southwest Florida's Current Market
Inventory continues to increase across Lee County and Collier County and the number of closed sales for the year through February is down 20%–27%, depending on the area and property type. As mentioned previously, these numbers are most likely skewed a bit due to a number of properties on the market that may be difficult to sell due to damage or open claims from Hurricane Ian.
This is most likely the case, as we are still seeing median property prices rising month-to-month and year-over-year in Lee and Collier Counties for most property types. From February 2022 to February 2023, we are seeing an 8%–15.5% increase in the median sale price. Price increases are expected to continue to slow down a little more as we continue into the year.
Single Family Stats for February 2023
| Feb 2022 | Feb 2023 | % (+-) | |
|---|---|---|---|
| Closed Sales | 1,308 | 992 | -24.2% |
| Closed Sales YTD | 2,437 | 1,859 | -23.7% |
| Median Sale Price | $406,000 | $449,500 | 10.7% |
| Average Sale Price | $552,534 | $574,230 | 3.9% |
| (Inventory) Active Listings | 4,523 | 5,803 | 28.3% |
| Months Supply of Inventory | 3 | 6 | 100% |
| Close Price to List Price Ratio | 100% | 98% | -1.8% |
| Median Time to Contract | 7 | 23 | 228.6% |
| Feb 2022 | Feb 2023 | % (+-) | |
|---|---|---|---|
| Closed Sales | 481 | 389 | -19.1% |
| Closed Sales YTD | 933 | 682 | -26.9% |
| Median Sale Price | $699,500 | $770,000 | 10.1% |
| Average Sale Price | $1,285,985 | $1,495,007 | 16.3% |
| (Inventory) Active Listings | 1,986 | 2,719 | 36.9% |
| Months Supply of Inventory | 4 | 7 | 75% |
| Close Price to List Price Ratio | 100% | 96% | -3.6% |
| Median Time to Contract | 7 | 42 | 500% |
Townhouses & Condo Sales in February 2023
| Feb 2022 | Feb 2023 | % (+-) | |
|---|---|---|---|
| Closed Sales | 575 | 444 | -22.8% |
| Closed Sales YTD | 1,090 | 790 | -27.5% |
| Median Sale Price | $315,000 | $340,000 | 7.9% |
| Average Sale Price | $395,614 | $448,919 | 13.5% |
| (Inventory) Active Listings | 1,720 | 2,577 | 49.8% |
| Months Supply of Inventory | 3 | 6 | 100% |
| Close Price to List Price Ratio | 100% | 98% | -2.3% |
| Median Time to Contract | 4 | 14 | 250% |
| Feb 2022 | Feb 2023 | % (+-) | |
|---|---|---|---|
| Closed Sales | 443 | 343 | -22.6% |
| Closed Sales YTD | 949 | 752 | -20.8% |
| Median Sale Price | $433,000 | $499,000 | 15.2% |
| Average Sale Price | $770,252 | $855,969 | 11.1% |
| (Inventory) Active Listings | 1,832 | 2,440 | 33.2% |
| Months Supply of Inventory | 4 | 7 | 75% |
| Close Price to List Price Ratio | 100% | 97% | -2.5% |
| Median Time to Contract | 5 | 24 | 380% |
*Data pulled from Southwest Florida MLS on 3/6/2023
What Does the Data Say?
Close price to list price ratio continues to drop in all areas across all property types, down to an average of 96.4%–98.2%. This, along with days on the market and months' supply of inventory increasing, means you will typically have more negotiating power as a buyer, as many sellers tend to over-list their homes, still trying to chase the top of the market.
If selling, it is important to work with an experienced team like Palm Paradise Real Estate to put together a marketing and pricing strategy to get your home sold. Remember: the first two weeks are the most important on the market, and you do not want to go through those two weeks with an overpriced home.
Across the country, the United States has fewer homes valued over $1 million, down to 7% from the June 2022 record high of 8.6%. Florida has kept its home values up, however, and as of January, there are more $1 million-plus homes than the year prior.
Florida also had six of the top 10 metropolitan areas with the greatest increase in home values last year. The reason for Florida's homes maintaining their value is the high demand from buyers—particularly remote workers—from more expensive areas of the country. Five of the country's top 10 migration destinations are located in Florida. The rest of the country is seeing buyer demand drop.
According to another report by Redfin, the typical U.S. homeowner stayed in their home for 12.3 years in 2022, down from a peak of 13.4 years in 2020. Despite the decline, homeowner tenure remains much longer than before, with the average tenure at 10 years in 2012 and 6.5 years in 2005. In Florida, only Miami has a tenure close to the national average, at 10.3 years in 2022.
The longer tenure trend is primarily driven by older adults aging in place, with most Americans aged 65 and older owning their homes for at least 23 years and aged 35–64 owning their homes for at least 8 years. Homeowners under 35, on the other hand, tend to stay in their homes for a shorter time, with 49% owning their homes for three years or less. The recent decline in tenure is attributed to the pandemic, with many people moving to new homes, primarily because of low mortgage rates, remote work opportunities, and more favorable locations.
The report states that homeowner tenure is not expected to drop much further due to several factors, including older Americans aging in place, lack of affordability, lack of move-up buyers, high rental prices, shortage of homes for sale, and the lock-in effect of low mortgage rates.
Trust Your Team at Palm Paradise Real Estate
If you'd like to discuss your upcoming real estate needs, whether you are considering buying or selling, you can reach any of our experienced team members by visiting us at www.PalmParadiseRealEstate.com or give us a call at 239-349-2487.
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Hear the latest news regarding interest rates from our partner lender, Greg Wasmuth, with Motto Mortgage Freedom.
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