Most of my out-of-town Buyers are sitting up north dreaming they were in Naples. There’s been a lot of press over the past year regarding real estate values in SW Florida in general and Naples in particular. I thought it might be helpful to hear from the front line.

The Year 2005 in Real Estate was a wild ride indeed. Property values increased by 30% and in some areas 40%. As Real Estate professionals, we all predicted an adjustment by the end of this past year. We welcomed an adjustment. Values were being driven by a buying frenzy – mostly by the investors looking for product to “flip.” The traditional buyer, looking for a slice of paradise for personal use, was going home discouraged due to the lack of inventory in their price range – and/or being out bid by another buyer for their Naples dream home.

I believe in the saying, “You don’t know where you’re going if you don’t know where you’ve been.”

Real Estate is cyclical. Real Estate in “metro” Naples has a history of plateauing after an appreciation spike.

Last year, inventory was paltry – and buyer demand was strong. As of February 2006, inventory has doubled over the same time in 2005.

Is it a Buyer’s Market?
Not quite yet. Seller’s who have priced their properties at prices derived by their neighbor’s selling price plus some, are just getting used to the fact that the party is over. It’s back to Real Estate 101. We have to rely on the comps in pricing – and Buyers will have the benefit of knowing that once again “comparables” do come into play when making an offer.

Will Prices Crash in Naples?
It’s very unlikely that Naples will experience a real estate crash any time soon. There’s at least 10 more years of growth driven by the Baby Boomers, and it’s not just people looking to retire either. With the power of technology, Generation “X” is also exploring relocating to Southwest Florida because they can “telecommute” from anywhere.

Have Hurricanes Charley and Wilma scared buyers off?
No. Hurricane Charley devastated our neighbors just 60 miles to the north of Naples. It was conventional wisdom that prices would plummet up there – not so. Values spiked along with Naples (relatively).

Hurricane Wilma hit closer to home. We were heart broken to lose mature banyan and mahogany trees that canopied neighborhoods west of US41. However, Naples has the luxury of being a relatively young community. Most homes were built or brought up to codes put into place after Hurricane Andrew hit south Miami in 1991. Wilma hit October 24th, and it’s now 120 days later; and to the first time visitor, there are very few signs of Wilma. Blue tarped roofs are few – and far between.

Is it a good time to purchase a home in Naples?
You bet! Buyers who purchased a home at the peak of the market in 2005 for their personal use should have no fear.

Investors, whose pockets aren’t deep, with the goal to flip developer’s product will be ready to make a deal.

We presently have over twice as much inventory as this time last year, so motivated sellers will be ready to negotiate. Buyers working with a Buyers Agent (look for the ABR designation) will get all the appropriate information to make an informed offer based on fact (comps) not fantasy. Mortgage rates are still relatively attractive. Now is the time to buy!

“Don’t wait to Buy – Buy and Wait.”
Real Estate should always be considered a long-term investment. Property purchased for the longer term (5 years) will almost always serve you well. If you see a property that serves your needs and speaks to your heart, don’t waffle. It’s unlikely you’ll get it cheaper another time. Make an offer! The worst that will happen is you won’t get it. No one gets what they want sitting on the sidelines observing.

Best of all, you can’t duplicate our climate – not even 60 miles north of here.
We are in a sub tropic zone located south of the 26 latitude. We enjoy a lush landscape not duplicated in northern environs of Florida. The Naples/Bonita Springs area continues to be the dream location that Boomers aspire to.

I have referred to several sources to write this personal commentary. There’s been much written in both our local and state Realtors publications along with The Naples Daily News. We’re in the height of season, and as always, town is packed. April will be a perfect time to visit Naples to explore purchasing your Slice of Paradise.

24 February 2006