Home prices continue their upward Trend



The median price of an existing single-family home in Lee and Collier counties increased sharply in October compared to a year earlier.
In Lee County, the median rose 17.3 percent from $157,000 to $184,175, according to statistics released by the Realtors Association of Greater Fort Myers and the Beach.
Collier County's median increased 20.1 percent from $279,000 to $335,000, according to the Naples Area Board of Realtors.
Fort Myers-based real estate broker Denny Grimes of Denny Grimes & Co. said that even with such a robust surge in prices, he doesn't see the danger of a bubble similar to the last boom's over-heated market in 2005.
"It would take annualized increases of 20 percent for five years to get us up into the territory where we were (at the peak of the boom)," he said. "We're not even close to a danger bubble."
The rate of increase in prices is actually slowing, Grimes said, but the market will stay strong this winter with omens such as six feet of snow in Buffalo, N.Y., last week. "We are poised to have a very, very good season."The median price of an existing single-family home in Lee and Collier counties increased sharply in October compared to a year earlier.In Lee County, the median rose 17.3 percent from $157,000 to $184,175, according to statistics released by the Realtors Association of Greater Fort Myers and the Beach.Inventory in both markets stayed tight with Lee's falling 11.8 percent from 5,847 active single-family listings to 5,157. Collier's increased only slightly: from 2,070 to 2,075.Grimes said that with relatively few homes for sale and a strong contingent of buyers, the market is strong but "there's no frenzy. They're engaged but they're not irrational."Condominium sales fell 3.1 percent in Lee County from 486 to 471 while the median sale price increased 3.5 percent from $157,500 to $163,000. Article courtesy of Fort Myers News Press.

Southwest Florida Real Estate Trendz

It's steady as she goes for Southwest Florida's real estate economy as it slowly recovers from the recession, the three presenters for The News-Press Market Watch say in their third-quarter review of the area's real estate economy.
Among other trends, there's been a steady resurgence of the commercial sector, which fell hard about two years after the 2006 implosion of residential construction.
The presenters — Randy Thibaut of Land Solutions Inc., Denny Grimes of Denny Grimes & Co. and Stan Stouder of CRE Consultants — examine how each quarter has treated the real estate sector.
This is the latest quarterly report in Sunday Business to keep our readers on top of recent trends in real estate. The News-Press holds its annual Market Watch presentation every year in February – this year's date is Feb. 25.
Stouder said commercial's comeback is an "echo" of an earlier residential revival that reflects the central role that home building plays in the local economy.
"When people start buying houses, people in all sectors go back to work," he said: "lenders, title, air conditioning contractors, drywall, plumbing, electrical contractors. All those guys now need space."
Newly flush residents are also fueling a wave of construction of new retail space such as the Harley-Davidson and Audi dealerships at Daniels and Interstate 75 in south Fort Myers, Stouder said.
The balance of supply and demand for the residential market itself is remarkably stable, Grimes said. "You think it's stuck, it's not moving. We're probably as rational as we've ever been. The Fort Myers Real Estate market as a whole is predictable, almost boring."
Thibaut, who specializes in large sales of land for residential development, says the first wave of that market was fueled by builders who had the foresight to buy land cheap at the bottom before things got going again.
Now, he said, there's a leveling off of big land sales as sellers realize construction is back and they don't have to sell for a song.
Gary Jackson, economist and director of the regional Economic Research Institute at Florida Gulf Coast University, said the overall picture is favorable nationally with employment and manufacturing on the rise. "I expect the economy to continue to recover."
That's crucial for Southwest Florida with its reliance on out-of-towners to buy homes and come here as tourists. "Our economy is very dependent on what's happening nationally and internationally."
Connect with this reporter: @DickHogan (Twitter).
Commercial real estate
There are a lot of positive points to make about commercial real estate, but before getting into the local market, let's look at what is happening nationally.
A consensus survey composed of 43 experts representing 32 of the U.S.'s leading real estate investment, advisory and research firms was convened by the Urban Land Institute and EY Real Estate. They predict that U.S. Commercial Real Estate (CRE) will see a steady strengthening with solid but not spectacular returns. Their sentiment was that things feel very good and there's plenty of price and rent growth left. Overall global economic growth is creating anxiety but the U.S. remains a strong haven for cross-border investment. Some key findings from the ULI/EY Real Estate Consensus Forecast include the following:
• Commercial property transaction volume will grow, although at a declining rate, and exceed 2006 volume, which was the second highest pre-recession annual volume, by 2016 to $445 billion.
• Commercial property prices are predicted to nationally increase by 10 percent in 2014. Price increases will then moderate to 6 percent in 2015 and 5 percent in 2016.
• Vacancy rates are expected to fall modestly for office, retail and industrial properties.
• Rent increases for all property types are projected to rise by 3 percent in 2016.
• Single family housing starts are projected to increase to 912,500 units per year by 2016, remaining below the long term annual average.
Here in the Southwest Florida commercial real estate market we are seeing through the end of Q3 2014 market activity consistent with the above national forecast.
• The office market has already absorbed nearly as much square footage by the end of Q3 2014, 312,000 square feet, than the office market absorbed for all of 2013 (355,400 square feet) with rents stable to increasing.
• Distressed sales (REO) of office property in Lee County Foreclosures are now at a negligible level dropping from 17 in 2013 to just four as of Q3 and only two in Collier and one in Charlotte counties.
• Industrial vacancy overall in the region has dropped with Lee County seeing its vacancy drop most appreciably from 15.6 percent at the end of 2013 to 11.7 percent at the end of Q3 2014.
• The industrial market has already absorbed more square feet (599,300) by the end of Q3 than in all of 2013 (557,900).
In the retail market, the centers with more national tenants have the lowest overall vacancy at 9.7 percent. These are called Power Centers as opposed to progressively smaller Community Centers 10.5 percent or Neighborhood Centers 12.7 percent.
The number of commercially zoned land sales continues to be as robust in 2014 as they were in 2013. Charlotte County has already had 51 transactions as of Q3 2014, compared to 35 for all of 2014, albeit at the same $1.43 per square foot median price.
The median sales prices for commercial land continues to show dramatic disparity increasing as one goes south, from Charlotte at $1.43 per square foot, to Lee at $2.14 and Collier at $8.83.
If residential real estate development creates the boom, then commercial real estate is its echo. It will be interesting to see how many residential units get absorbed through this coming season as it, though to a lesser extent than in years past, is a harbinger of the ongoing sustainability of this commercial real estate recovery in Southwest Florida.
It is so nice that once again things do indeed feel good in the Southwest Florida commercial real estate market. Will it speed up or slow down? How will this affect you? Clues to those answers await you on Feb. 24 at the 15th annual Market Watch. As you can see, we've already begun preparing. You are invited. Won't you join us? Courtesy Fort Myers News Press.