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Broad overview of solid first quarter Cape condo sales

April 17, 2020
By BOB & GERI QUINN - Homing In , Cape Coral Daily Breeze

This week we thought we would provide you with a general overview of the Cape Coral condominium market through the first quarter of this year, along with a snapshot of our high-end luxury condo market.

As we expected, our condo market posted solid sales numbers in the first quarter, however, as with just about everything, there is less market visibility going forward. Among the COVID-19 issues to keep an eye on as it relates to our real estate market is the news out of JP Morgan that they are increasing the credit score requirements for people trying to qualify for a new purchase mortgage. They also announced they will begin requiring a 20 percent cash down payment towards home purchases. These moves could start shrinking the pool of qualified home buyers, depending upon how many other lenders decide to follow suit.

Overall, based on the results posted as of April 13, there were a total of 177 closed condo sales in Cape Coral during the first quarter of this year, which was 18 percent higher than the 150 closed sales recorded in the first quarter of 2019. As we have pointed out in the past, since most properties go under contract with a buyer as a pending sale some 30 to 45 days prior to being finalized as a closed sale, these first quarter condo sales were already in the pipeline before the impact of the COVID-19 virus and social distancing shutdowns put the U.S. economy into a freefall beginning in about mid-March.

Here is a breakdown of these 177 closed condo sales in Cape Coral. Seventeen of them, or 9.6 percent, sold for under $100,000 and 43 units, or 24.29 percent of the total, sold in a $50,000 range at prices between $100,000 and $149,999. So basically one-third of Cape Coral condos sold for less than $150,000. A tighter sweet spot, with a $25,000 price range, was found at sales prices between $175,000 to $199,999 where there were 38 closed sales, making up 21.45 percent of the first quarter sales total. Viewed in a broader grouping, the price range between $150,000 and $224,999 had a total of 85 sales, for 48 percent of the total condo units sold. And, framing it another way, 145 of the Cape's 177 closed condo sales in the first quarter of this year, or 81.92 percent of our condo market, were sold for less than $225,000.

Moving higher up the price scale, there were 25 closed condo sales in the Cape within the $225,000 to $499,999 price range, which made up 14.12 percent of our first quarter sales. Eleven of these 25 sales, or 6.20 percent of the 177 total sales, were between $225,000 and $299,999; with six, or 3.39 percent, coming in between $300,000 and $399,999; while eight of these 25 condo sales, or 4.52 percent of the 177 total sales, were sold in the $400,000 to $499,999 price range.

This brings us to the Cape's high-end, luxury condo segment, which totaled 3.95 percent of our first quarter closed condo sales at prices ranging from $500,000 and up. There were a total of seven luxury condos sold in the first quarter of this year, with one closed sale each in January and February, and five closed sales in March. These seven sales ranged in price from $525,000 to $875,000 with the lowest priced of these condos located in the Paradise Point complex along the river at the end of Beach Parkway in the Southeast Cape. The other six sales, from $555,000 and up, were in the high-rise buildings at Tarpon Landings in Tarpon Point Marina in the Southwest Cape. These seven sales compare to only four high-end Cape Coral condos being sold in the first quarter of 2019, during a time when sales remained sluggish while our real estate market was still trying to shake off the lingering ill effects of the water quality crisis of 2018.

Also of note as we closed out the first quarter of this year was that there were two other luxury condos currently under contract with buyers as pending sales. Both of these pending sales were located in Tarpon Landings, and they are likely to close during the second quarter, although one of these units may end up with a final sales price under our $500,000 luxury condo threshold. In addition, we usually see at least one condo from Cape Harbour on our highest priced luxury condo list, however, in the first quarter of this year the top price for a closed Cape Harbour condo sale came in at $473,850. In 2019, one Cape Harbour condo unit made our first quarter luxury condo list with a final sales price of $570,000.

On our current list of luxury condo sales, the highest-priced sale in the Cape during the first quarter provided a good example about our market boom from back in 2006, as our real estate market was topping out. At that time, this 11th floor luxury end unit in one of the new Tarpon Landings high rise buildings was sold to its original owner for $1.295 million in September 2006. They eventually sold the unit for $875,000 in January 2010, for a 32.43 percent loss of $420,000 before paying any seller-related expenses associated with the sale. According to the records, this second owner just sold the unit in a cash deal on March 2, for $875,000 or for the same amount at which they bought it just over 10 years ago. This was also prior to calculating any seller-related expenses, meaning the seller would have taken a small loss on the sale, relatively speaking.

The second highest priced Cape Coral luxury condo sale during the first quarter was also for a high rise unit in Tarpon Landings, which was built in 2007. This sale closed in January and it was sold by the original owner, who bought it for $887,900 back in March 2007. This seller started out trying to sell this unit at an initial listing price of $829,000 back in May 2014, and they pretty much kept it on the market for more than four years, through July 2018 when they took it off of the market after lowering the list price down to $699,000. They put it back on the market at $699,000 in April 2019, and ultimately sold it for $660,000 or for 20.39 percent below its initial list price from back in 2014. The seller took a $227,900 hit on the sale before paying any seller-related expenses tied to the sale, meaning this condo sold for 25.67 percent below what it was purchased for some 13 years prior to this sale.

(The sales data for this article was obtained from the Florida Realtors Multiple Listing Service Matrix for Lee County, Fla., as of April 13, 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 data for single-family homes, foreclosures, or short sales. 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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