Average Home Prices Reach $300,000 - First Time in 12 Years: After reaching a high of $365,000 at the peak of the market in early 2006, then falling during the real estate crash to $119,000 in Jan 2011, Cape Coral average home prices hit the magic $300,000 mark in April. This was especially encouraging since two of the first three months of this year saw lower prices than the same months last year.
List-to-Sales Price Holding Steady at 97%, although that margin could shrink if inventory drops much lower (see inventory below)
Home Sales Soar over 500 – Most Sales Since June 2011: There were 541 Cape Coral home sales in April, the most home sales in 7 years, and an 18% increase over the 458 home sales in April 2017.
Only 3 1/2 Months Home Inventory: This is the lowest level of available homes in a year, and bodes well for sellers, not so much for buyers. It’s also a strong indicator of why we need more new construction homes
191 New Home Permits - 2nd Highest since 2007: Still below the 250 -300 new homes needed each month to keep pace with new residents, but a nice improvement. Interesting fact: At the peak of the market in 2005 there was an average of 641 new home permits per month, with one month going over 840 permits. This was far too many new homes to meet demand and contributed greatly to the local real estate crash.
Tom: I'll keep a close eye on permits so we’ll know when we’ve reached the saturation point, which will be a “heads-up” that the market is about to level off.
Million Dollar Home Sales in Cape Coral Hits New High in April: Ten Cape homes sold for $1M or higher in April. The highest priced home sale was $1,900,000 and the average was $1,347,000. This high number of home sales at $1M + is another milestone which we haven’t seen since before the Great Recession. Eight of the homes sold in the SW section of the Cape and two in the SE quadrant. Tom: The Tax Reform Bill (see article below) is partially responsible for the upswing in luxury home sales in our SWFL waterfront cities.
The federal tax bill is already having a very positive impact on home sales in Florida, especially by folks in high-income tax brackets living in states with high property and high state income taxes. Several high-tax states like Calif, Ill, NJ, NY, Conn, Mass, are starting to see an exodus of high earning residents, particularly if those people are ready for retirement or are able to work from any location they want. In the high-tax states, it is quite easy to surpass the combined $10,000 income tax, property tax, and sales tax maximum deduction.
Florida has long been known as a tax-friendly state, but much more so with the tax bill enacted in December. Out-of-state homeowners now have one more reason to consider Florida as their home state besides the warm weather, numerous waterways, and great Homestead benefits.
Tom: I suggest that whether you live in Florida or another state you ask your CPA to provide you a mock tax return based on your current income under the new tax rules. Most people that I’ve spoken to have not done so. Sue and I are happy to report that we will have a significant tax savings, and hope the same for you. Either way, it behooves you to know in advance.
PREDICTION: When high-earners in high tax states file their 2018 Income Tax Returns in April of 2019 and realize what their income taxes will be under the new tax bill (or how much less it could be in a tax-friendly state like Florida), our entire state is going to see a wave of new residents. Mark it down, and hold me to it.
Today’s 30-year mortgage rates are under 5%. From 1972 (when Freddie Mac records began) through 1979, the 30-year fixed average mortgage averaged 9.03%. It averaged 12.71% in the 1980’s, 8.12% in the 1990’s, and 6.29% from 2000 through 2009. And in those decades of higher mortgage rates, people still bought houses.
Tom: Although an increase in interest rates can eventually slow down home sales and prices, the recent rise in rates hasn't had any effect in SW Florida, with our lead article as evidence of that. I estimate that it will take at least 6% interest rates before our market will see a noticeable difference
Bathrooms have overtaken kitchens as the most popular remodeling project, according to a survey by the National Association of Home Builders.
The Most Common 2017 Projects:
81% bathroom remodeling
78% kitchen remodeling
49% whole house remodeling
37% room additions (due to the size of the standard lots in our area, there aren’t many room additions)
30% window/door replacements
Matlacha Receives Well-deserved Recognition: Matlacha (remember, it’s pronounced Mat-la-shay) was listed as the fourth best tiny town in the South by Southern Living Magazine. Sue: I love that we live so close to this charming, historic and interesting little artsy waterfront town, with pastel-colored homes and cottages on Pine Island. We call it our “Mini Key West”. You must make it a point to visit this little gem of a town.
Flood Insurance Reminder: Don’t forget to secure flood insurance on your home if you are in a potential flood zone. Hurricane season officially starts on June 1st, and flood insurance doesn’t kick in for 30 days.
Home Affordability Down 10-15% By Year End: According to the Housing and Mortgage Market Review homeownership cost will increase by 10-15% by year’s end due to the anticipated rise in home prices, interest rates, and insurance. For homeowners looking to sell, there is good news in the report. Due to a shortage of inventory home values are expected to continue to appreciate.
Record-Breaking Passengers Arrive at Ft Myers Airport: SW International Airport scored record growth in the first quarter of 2018, including a 10.2% year-over-year increase in passengers in March. This was despite numerous flight cancellations due to weather conditions in other parts of the U.S. March is historically the airport’s busiest month, but this March now stands as the single-busiest month at the Ft Myers airport, which will mark its 35th birthday in May.
Home Prices And Sales Numbers - Florida's Stringent Building Codes Thwarted Hurricane Damage - Foreign Buyers Still Loving The Sunshine State
Want To Buy A Home In SWFL While Still Living In Your Current Home? - Florida Property Taxes Are Average In Comparison To Other States - Pickleball In Cape Coral
SW Florida Real Estate Once Again Showing Strong Signals - 12 Reasons SWFL Real Estate Will Stay Strong - Be Wary Of The Builder You Choose
Cape Coral/SWFL Recap & 2018 Projections - Will Tax Reform Affect SWFL Real Estate? - Cape Coral Rated #1 Boomtown In U.S.
Why Aren't Homeowners Becoming Sellers? - Profile Of International Buyers In Florida - Local Home Market Synopsis
Interesting Florida/Cape Coral Population Stats - Despite Irma, Local Unemployment Rate Drops to 3.5% - Bubble? Nowhere in Sight for U.S. Housing Market
Irma Slows Down Sales But Not Prices - Nor-Tech Hi-Performance Boats To Locate World Headquarters In Cape Coral - Homesteaded Properties Will See Assessed Values Increase by 2.1%
Cape Coral Dodged A Bullet - Some Lenders Will Stop Requiring Traditional Appraisals - Homeowners Only Break Even By Selling Their Home Without A Realtor
Can't Find the Perfect Model Home to Build? - We Have Solutions - Investors Focusing on Build-to-Rent Homes - Cape Coral in Top 100 Cities For First-Time Homebuyers
Be Very Careful When Selecting A Local Builder - Cape Home Inventory Drops To Three Months - Zero Down Loans Make A Comeback
Home Sales Still Strong For Low & Mid-Priced Homes - Cape Coral Named One of the Best U.S. Cities for Boaters - Homeowners Sue Zillow Over Low Home Value Estimate
Cape New Construction Permits Spike - Rise In Cape Coral Million Dollar Home Sales - Increased Importance Of Third Car Garage