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Fourth quarter supply of unsold Cape condos improves

February 14, 2020
By BOB & GERI QUINN - Homing In , Cape Coral Daily Breeze

After beginning the year with an abnormally high level of unsold supply in 2019, due in large part to sluggish first quarter sales, the inventory numbers in the Cape Coral condominium market improved throughout the remainder of last year. The poor start to last year was largely a result of the lengthy, ongoing water quality crisis in 2018. But as the water quality improved throughout last year, and the river and gulf coast beaches returned to normal, condo sales recovered and the monthly supply of unsold condos in the Cape moved sharply lower.

This was especially true in our gulf and sailboat access canal condo segments, where we saw significant decreases in the monthly supply of unsold condos in both the month of December and in the fourth quarter of last year, compared to the much higher water crisis inventory levels of 2018. We also saw a large decrease in the December and fourth quarter supply levels in our dry lot condo segment versus its 2018 levels.

Although we expect to see some of the typical seasonal increases to the unsold supply numbers in January and February, as the seasonal sellers take their shot at selling their condos to the mass influx of winter visitors, we are heading into 2020 with a lower than normal supply. This should bode well for any sellers who realize the importance of pricing their condos reasonably to the current market, as buyers continue to remain very rational in what they will pay for a condo or a single-family home. Based on the results of the last four years, we fully expect to see two very distinct market segments in the Cape. The larger segment will consist of an oversupply of overpriced homes and condos, which will sit on the market unsold until the sellers make some fairly significant price reductions. The smaller segment will consist of the tight supply of reasonably-priced homes and condos, which will likely attract multiple buyers and go under contract quickly. Price it right, and it will sell.

Here is one other tip for sellers. Most buyers are looking for clean, well-maintained, updated and move-in ready homes and condos. If your home or condo does not meet these criteria, it will almost certainly need to be priced at a discount to the market in order to attract a buyer.

In the overall Cape Coral condo market, the monthly supply of unsold condos came in at 6 months in December, which was 40 percent lower than the 10 months of unsold supply in December 2018, but even with the 6 months of supply in November 2019. In the fourth quarter, the overall unsold supply of condos in the Cape averaged 6 months, which was 33.33 percent below the average of 9 months of supply in the fourth quarter of 2018, but even with the average of 6 months of unsold supply in the third quarter of last year. Through Dec. 31, the supply of unsold condos in the overall Cape market averaged 6.67 months for the year in 2019, or 1.19 percent lower than the average of 6.75 months of supply for the full year in 2018. This places the overall Cape Coral condo market firmly in a neutral market.

Gulf access canal condos

In the Cape Coral gulf access canal condo segment, the monthly supply of unsold condos came in at 7 months in December, which was 46.15 percent lower than the 13 months of unsold supply in December 2018, but even with the 7 months of supply in November 2019. In the fourth quarter, the unsold supply of condos in this segment also averaged 7 months, which was 43.23 percent below the average of 12.33 months of supply in the fourth quarter of 2018, and 4.5 percent lower than the average of 7.33 months of unsold supply in the third quarter of last year. Through Dec. 31, the supply of unsold gulf access condos in the Cape averaged 8.33 months for the year in 2019, or 8.26 percent lower than the average of 9.08 months of supply for the full year in 2018. This places the Cape's gulf access condo segment in the higher end of the neutral market range at year end.

Sailboat access canal condos

In the Cape Coral sailboat access canal condo segment, which is a subgroup of gulf access condos, the monthly supply of unsold condos came in at 6 months in December, which was 53.85 percent lower than the 13 months of unsold supply in December 2018, but even with the 6 months of supply in November of 2019. In the fourth quarter, the unsold supply of condos in this segment averaged 6.33 months, which was 53.69 percent below the average of 13.67 months of supply in the fourth quarter of 2018, and 34.54 percent lower than the average of 9.67 months of unsold supply in the third quarter of last year. Through Dec. 31, the supply of unsold sailboat access condos in the Cape averaged 9.58 months for the year in 2019, or 9.45 percent lower than the average of 10.58 months of supply for the full year in 2018. This places the Cape's sailboat access condo segment in the very high end of the neutral market range, bordering on being in a buyer's market at year end.

Dry lot condos

In the Cape Coral dry lot (non-canal) condo segment, the monthly supply of unsold condos came in at 5 months in December, which was 28.57 percent lower than the 7 months of unsold supply in December 2018, but even with the 5 months of supply in November 2019. In the fourth quarter, the unsold supply of condos in this segment averaged 4.67 months, which was 29.99 percent below the average of 6.67 months of supply in the fourth quarter of 2018, and even with the average of 4.67 months of unsold supply in the third quarter of last year. Through Dec. 31, the supply of unsold dry lot condos in the Cape averaged 5.17 months for the year in 2019, or 1.77 percent higher than the average of 5.08 months of supply for the full year in 2018. The Cape's dry lot condo segment remains the only portion of our condo market that was in a lower supply seller's market at year end.

(The sales data for this article was obtained from the Florida Realtors Multiple Listing Service Matrix for Lee County, Fla., as of Feb. 2, 2020. It was compiled by Bob and Geri Quinn and it includes information specifically for Cape Coral condominiums, townhouses and villas, and it does not include any 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 40 years. Geri has been a full-time Realtor since 2005, and Bob joined 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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