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Positive trends towards lower supply of Cape condos

May 11, 2018
By BOB and GERI QUINN - Homing In , Cape Coral Daily Breeze

In the Cape Coral condominium market, the monthly supply of unsold condos listed for sale continued to follow the seasonal trend of having a lower supply available on the market in the month of March compared to the months of January and February. This month of March trend can usually be taken as an indication that we are likely to see a lower supply of unsold condos listed for sale on our market during the second quarter of the year, which can be a positive sign for any sellers who have their condos priced properly to the current market. As we have mentioned repeatedly in this column, there are a lot of potential buyers looking for homes and condos in Cape Coral, but they remain very rational about the prices they are willing to pay. If your property has been sitting on the market unsold and you are not getting many showing appointments from interested buyers, there is a high probability "the market" is viewing your condo as being overpriced.

The tightest supply continues to be found in the dry lot (non-canal) condo segment, which generally has the lowest price points in our market. The lower prices for dry lot condos will tend to attract a much larger pool of potential buyers than we will see in the higher priced condo segments. Having a larger pool of available buyers creates more competition between buyers and makes it easier to sell a reasonably priced dry lot condo in a shorter time frame, which helps create a lower level of unsold supply. When one considers that the median sales price on a dry lot condo averaged $128,317 per month in the first-quarter of 2018, versus $231,650 for a sailboat access canal condo, a dry lot condo will be more affordable to a much wider range of buyers.

Here is a breakdown of the supply of unsold condos in our market by property segments.

Dating back to 2011, when we combine each property segment together to take a broad view of the overall Cape Coral condo market, the unsold condo supply in the month of March has been at either 5 or 6 months. So it was no surprise when this March came in with an unsold supply of 5 months, matching the 5 months of unsold supply from March of 2017. We also had the typical seasonal decrease in the unsold supply, with March coming in 16.67 percent below the 6 months of unsold supply in February of this year. In the first quarter of this year, the supply of unsold condos in our overall market averaged 6 months, which was 18.14 percent lower versus the average of 7.33 months in the first quarter of last year, and 5.21 percent below the average of 6.33 months in the fourth quarter of 2017. These lower levels of unsold supply, combined with the solid number of condos sold in the first quarter, which we discussed last week, point to relatively healthy condo market conditions so far in 2018.

Gulf access canal condos

In the Cape Coral gulf access canal condominium segment, we saw a lower monthly supply of unsold condos across the board in the month of March and for the first quarter of the year. In March, the unsold supply was at 5 months, which was down 44.44 percent from the 9 months of supply back in February, and it was 16.67 percent lower than the 6 months of supply in March 2017. In the first quarter of this year, the unsold supply of gulf access condos averaged 7 months, which was 32.24 percent less than the 10.33 months of supply registered in the first-quarter of last year, and 22.22 percent below the average of 9 months of unsold supply in the fourth quarter of 2017. Despite the improving numbers in the supply of unsold gulf access condos so far in 2018, this segment has been stuck somewhere between a neutral market and a higher inventory buyer's market for an extended period of time, so it still has a ways to go before making any significant shift towards becoming a lower inventory seller's market.

Sailboat access canal condos

In the Cape Coral sailboat access canal condominium segment, which is a subgroup of gulf access canal condos, we also saw a very positive market move to a lower supply of unsold condos in March and for the first quarter of 2018. With the unsold supply also coming in at 5 months in March, it was 44.44 percent lower than the 9 months of supply in February of this year, and 37.5 percent below the 9 months of unsold supply in March 2017. In the first quarter of this year, this segment had an average unsold supply of 7 months, which was 58 percent less than the average of 16.67 months of supply in March of last year, and 19.26 percent below the average of 8.67 months of unsold supply in the fourth quarter of 2017. This move into a lower inventory, neutral market for sailboat access condos is a plus for anyone trying to sell a condo in this segment, but for now, it is still a long way from turning into a seller's market.

Dry lot condos

The supply of unsold dry lot condos was at 5 months in March, which was 25 percent higher than the 4 months of unsold supply in March of 2017, but down 16.67 percent from the 6 months of supply in February of this year. The first quarter of 2018 ticked slightly higher, with the unsold supply of dry lot condos averaging 5.67 months, or 13.4 percent above the average supply of 5 months in the first quarter of last year, but it was 5.5 percent lower than the average of 6 months of unsold supply in the fourth quarter of 2017.

Although the dry lot condominium segment joined every other condo property segment in Cape Coral with a 5 month supply of unsold condos in the month of March, this is the only portion of our market that has been in a lower inventory seller's market on a fairly consistent basis over most of the last three years. The unsold supply in this condo segment will occasionally move slightly higher into neutral market territory with a quarterly average of 6 months of unsold supply, along with some monthly spikes higher, such as hitting 10 months of supply last October in the aftermath of Hurricane Irma. But for the most part, we look for this segment of our condo market to remain in a tighter supply, seller's market this year.

(The March and first quarter 2018 sales data for this article was obtained from the Florida Realtors Multiple Listing Service Matrix for Lee County, as of April 30, 2018. It was compiled by Bob and Geri Quinn and it includes information specifically for Cape Coral condominiums, villas and townhouses, and does not include single-family homes, short sales or foreclosures. The data and statistics are believed to be reliable, however, they could be updated and revised periodically, and are subject to change without notice. The Quinns are a husband and wife real estate team with the RE/MAX Realty Team office in Cape Coral. They have lived in Cape Coral for over 38 years. Geri has been a full-time Realtor since 2005, and Bob, who also holds a Certified Financial Planner designation, joined with Geri as a full-time Realtor in 2014. Their real estate practice is mainly focused on Cape Coral residential property and vacant lots.)

 
 
 

 

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