Naples home prices keep soaring despite fewer sales and mushrooming inventory, the latest data shows.
Five years ago, the overall median closed price was $335,000. Today, it’s at $625,000, a 5% jump from a year ago, according to Naples Area Board of Realtors or NABOR. Transactions are down more than 9% from that time in 2023 while 67% more abodes are available, reaching above 5,000.
A NABOR analysis found patient buyers are still shelling out big cash if a Collier County house meets their high standards: “In the face of far more inventory and opportunity, home values are holding steady in Naples today. People are being highly selective and will wait until they find the right property.”
Here’s what to know.
1. How many price decreases have occurred?
Even with rising costs, not all Naples homeowners are getting the price they desire, and may want to consider heeding 1968-69 words of the Rolling Stones: “You can’t always get what you want. But if you try sometime, you’ll find you get what you need.”
February featured 2,264 price decreases, indicating “sellers are shifting from aspirational pricing to realistic market pricing,” NABOR research concluded. “Some sellers are still struggling to accept the fact that the pandemic buying frenzy years with climbing price increases are over. As more new sellers enter the market, those sellers with overpriced properties risk missing an opportunity” attracting buyers.
2. What about interest rates, which are closer to what had been normal?
Vanderbilt Realty Broker Dominic Pallini said eager buyers are out there, with rising interest rate shock subsiding. They’re now closer to where they had been historically, according to industry publication, Bankrate, which has served financial institutions since 1976.
“New homeowners are showing acceptance of 6.5 or 7% interest rates,” Pallini said.
3. How have mortgage rates varied nationally over the years?
| Year | 30-year fixed-rate average |
|---|---|
| 2023 | 7.00% |
| 2022 | 5.53% |
| 2017 | 4.14% |
| 2012 | 3.88% |
| 2007 | 6.40% |
| 2002 | 6.57% |
| 1997 | 7.57% |
| 1992 | 8.27% |
| 1987 | 10.40% |
| 1982 | 16.04% |
| Source: Bankrate, Freddie Mac |
4. What is a major factor in the housing market right now?
“Property insurance rates are influencing home buying decisions,” said Adam Vellano, a managing director at Compass Florida, which has offices in Collier and Lee, where Royal Palm Coast Realtor Association is reporting a 3% median home price drop to $380,000 from a year ago and a 4% decline in purchases.
As many are experiencing, when home values escalate, the replacement cost to insure also rises, Vellano and other brokers said, while noting what’s ahead: Coupled with insurance rates, association fees could swell for condominium owners by the end of 2024 tied to inspection legislation. February condo inventory rose 104.2% from a year ago to 2,614.
Real estate:SW Florida homes not selling as quickly as much of America; Collier County part of a trend
5. How much are Fla. insurance rates expected to jump in 2024?
Florida home insurance rates are expected to grow 7 percent this year, according to Insurify projections. The state’s owners already pay more than four times the national average, and forecasts for a hyperactive Atlantic basin in 2024 could lead to even higher pricing. AccuWeather predicts an “explosive” hurricane season, with potential to break the all-time record of 30 named storms.
“A hurricane season from hell could pile crisis upon crisis,” said Betsy Stella, Insurify vice president of carrier management and operations. “The financial solvency of all insurance companies will be tested.”
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6. How much of an increase has there been in 300K homes in Naples?
The NABOR report showed a 103.4% leap in properties under $300,000.
Possibly, “investors are offloading rental property units to capitalize on the winter selling season,” said Mike Hughes, Downing-Frye Realty vice president. “Also, the carrying costs on some of these properties has climbed in recent years. This increase in inventory, for buyers looking in this price range, is encouraging.”
Based at the Naples Daily News, Columnist Phil Fernandez (pfernandez@gannett.com) has led Pulitzer Prize-winning efforts. He writes In the Know for the USA TODAY Network, which supplemented this report. Support democracy. Subscribe to a newspaper.
Alice J. Roden started working for Trending Insurance News at the end of 2021. Alice grew up in Salt Lake City, UT. A writer with a vast insurance industry background Alice has help with several of the biggest insurance companies. Before joining Trending Insurance News, Alice briefly worked as a freelance journalist for several radio stations. She covers home, renters and other property insurance stories.