Geri and Bob Quinn

The major takeaway in our real estate market in January was the continued shift towards an abnormally low level of inventory currently available for sale. This trend towards an ever tightening supply of homes existed a year ago, and there was an acceleration to the rapidly dwindling supply levels in the second half of 2020 due to a record number of sales after Florida was reopened for business following the COVID-19 shutdowns. There is now a very clear and distinct advantage to most home sellers when it comes to negotiating the sales price and terms of a deal, to the point it is changing the behavior of buyers and their agents.

In our red hot seller’s market fed by strong buyer demand, it has reached the point where it is virtually impossible to underprice a home, all but eliminating a seller’s most often stated worst fear of “giving away” their home to a buyer at a price that is below the market. In fact, the market has become so competitive for buyers that even homes that are priced correctly to the current market will likely receive multiple full price and above full price offers. Yet, there is still a magical line in the sand between a seller listing their home correctly to the current market and getting it sold, or overpricing their home and having it sit on the market unsold. 

Any homes that come onto the market underpriced will have a line of buyers stacked up trying to get in for a look and multiple above list price offers will begin arriving on the first day the home goes live on the Multiple Listing Service. In this scenario, the listing agent is more likely to have individual buyers contacting them directly, without being represented by a buyers agent, and offers are likely to come in from buyers who have not yet seen the home in person. Buyers will be given a deadline to submit their highest and best offers, and in the end, the seller should receive an amount above the list price and somewhere around the fair market value. This scenario is rare in our current market and will feel very chaotic to sellers. 

When a home is priced properly to the market, a seller will likely have several showings scheduled immediately on the first day or two the home goes active on the MLS, and there will be a steady stream of showings during the first week. Agents will likely schedule live video streaming appointments with their out-of-town buyers and at least several full price, or above full price, offers will be made within the first week or so, if not within days of the home being listed on the market. Some of these offers will have escalation clauses that say the buyer will raise his or her offer price to beat all other offers by a certain dollar amount. When a home is priced correctly to the market, a seller will end up with a nice mix of very solid offers from which to choose. This process will be very busy and quick, but not chaotic.  

Here is an example of what we are seeing. Recently, one of our out-of-town buyers asked us to check out a home for them which did not have very thorough photos and there was no video of the home. We went out right away to preview the property in person and sent them a walk-through video, advising them that based on the location, quality, condition and time on the market, the home was overpriced. It has now been on the market unsold for 30 days this time around, while records show it has been sitting on the market unsold at the same price for the last 6 months. We then sent them information about another home that had just come onto the market, telling them it looked like it would meet their parameters and it appeared to be priced correctly to the market. They did not respond right away and before they got back to us, the home was under contract with a buyer after four days on the market.

As of March 1, there were only 345 active single-family home listings in the Cape, down a bit from the 354 active listings a week ago, and 31.27 percent below the 502 active listings less than two months ago, on Jan. 18. There are currently 1,268 pending sales in the pipeline, most of which should be finalized as closed sales within the next 30 to 60 days. 

In the overall Cape Coral single-family home market, the monthly supply of unsold homes came in at 4 months in January. This was 50 percent lower than the 8 months of unsold supply in January 2020, but 33.33 percent higher than the 3 months of supply registered in December. Our overall single-family home market remains in a lower inventory seller’s market. 

Indirect gulf access canal homes

In the Cape Coral single- family indirect gulf access canal home segment, which covers homes with at least one bridge for boaters to go under in the canal system, the monthly supply of unsold homes came in at 3 months in January. This was 75 percent lower than the 12 months of unsold supply in January 2020, but it was up from the record low of 2 months of supply in this segment in December. This abnormally low level of inventory for this segment in January has the indirect gulf access canal home segment placed deep within a seller’s market.

Direct sailboat access canal homes

In the Cape Coral single-family direct sailboat access canal home segment, which represents homes without any bridges in the canal system, the monthly supply of unsold homes came in at 3 months in January. This was 62.5 percent lower than the 8 months of unsold supply in this segment in January 2020, and it was even with the 3 months of supply in December. This extremely low level of inventory in this segment is all but unheard of, and it has the Cape’s direct sailboat access canal home category in a seller’s market.

Freshwater canal homes

In the Cape Coral single-family freshwater canal home segment, the monthly supply of unsold homes came in at 3 months in January, which was 72.73 percent lower than the 11 months of unsold supply in January 2020, but 50 percent higher than the 2 months of supply registered in December. This segment is also in a low inventory seller’s market.

Dry lot homes

In the Cape Coral single-family dry lot (non-canal) home segment, the monthly supply of unsold homes came in at 4 months in January, which was 42.86 percent lower than the 7 months of supply in January 2020, but 33.33 percent above the 3 months of unsold supply in December. In the past, this segment has typically had the lowest monthly supply of unsold homes in our market, but as home prices have shifted higher over the past several years it has been creating some affordability issues for dry lot homes in the Cape, leading to a somewhat higher than normal level of inventory. The dry lot home segment does, however, remain in a seller’s market with less than 6 months of unsold supply. 

The sales data for this article was obtained from the Florida Realtors® Multiple Listing Service Matrix for Lee County, Fla., as of Feb. 21, 2021, unless otherwise noted. It was compiled by Bob and Geri Quinn and it includes information specifically for Cape Coral single-family homes, and does not include condominiums, 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 41 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.