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Third quarter condo supply sharply lower than last year

By BOB & GERI QUINN - Homing In | Nov 18, 2021

Geri and Bob Quinn

We continue to see an abnormally short supply of condos listed for sale through the Multiple Listing Service in Cape Coral as we remain deeply entrenched in a seller’s market. The monthly inventory levels are substantially lower than a year ago, however, we have seen the condo supply increase from the second quarter to the third quarter of this year.

We are still seeing very strong interest in Cape Coral real estate from out-of-town buyers despite the economic concerns over sharply rising costs and supply chain issues on just about everything. Throw record high home prices into the mix, along with looming questions about the impact of changing Federal Reserve policies and government spending, and the rapidly growing level of negative consumer sentiment in economic surveys indicating a large number of people plan to hold off on major purchases, such as homes, and one might wonder why so many buyers are still showing up in our market.

We think there are several reasons for our strong market dynamics. First, interest rates have remained low with the average for 30-year fixed-rate mortgages dipping back below 3 percent again last week as the threat of higher interest rates has yet to materialize. The tight supply of homes available for sale in Southwest Florida is also contributing to our market strength, not to mention the weather and favorable tax rates. But based on our conversations with numerous buyers, the top reasons for the continued interest in Cape Coral, and with Florida in general, is because many people are now able to continue working remotely from anywhere and they have grown tired of all of the restrictive mandates and high taxes being imposed on them in certain states. This makes Florida one of the most attractive alternatives on a lot of levels for a number of people.

As of Tuesday, Nov. 16, there were only 38 active condo listings in the Cape through the Multiple Listing Service ranging in price from $110,000 to $995,000. The current median list price for Cape Coral condos is $264,900. A week ago, we had 41 condos listed for sale in the MLS at prices ranging from $155,900 to $1.1 million, with a median list price of $279,900. Of the current 38 condo listings, nine are priced under $200,000 and 13 are listed for more than $300,000. The remaining 16 units are going for between $200,000 and $300,000. There are currently 88 condos under contract with buyers as pending sales with list prices from $99,900 to $1,079,000 at the time an offer was accepted. A year ago, on Nov. 1, 2020, there were 202 condos listed for sale in the Cape and there were 95 pending condo sales. There are currently no distressed Cape Coral condo properties listed in the MLS.

In the overall Cape Coral condo market, the monthly supply of unsold condos came in at 2 months in September, which was 60 percent lower than the 5 months of unsold supply in September 2020, and 33.33 percent below the 3 months of supply in August of this year. In the third quarter of this year, the overall unsold supply of condos in the Cape averaged 2.33 months, which was 53.4 percent below the average of 5 months of supply in the third quarter of 2020, but 16.5 percent higher than the average of 2 months of unsold supply in the second quarter of this year. In the first nine months of this year, the unsold supply of condos in the overall Cape market averaged 2.7 months, or 60 percent less than the average of 6.7 months of supply in the first nine months of 2020.

Gulf access canal condos

In the Cape Coral gulf access canal condo segment, which includes all saltwater canal condominiums, the monthly supply of unsold condos came in at 1 month in September, which was 75 percent lower than the 4 months of unsold supply in September 2020, and 66.7 percent below the 3 months of supply in August of this year. In the third quarter of this year, the unsold supply of condos in this segment averaged 2 months, which was 53.8 percent less than the average of 4.33 months of supply in the third quarter of 2020, but even with the average of 2 months of unsold supply in the second quarter of this year. In the first nine months of this year, the unsold supply for all saltwater canal condos averaged 2.44 months, or 62.8 percent less than the average of 6.56 months of supply in the first nine months of 2020.

Direct sailboat access canal condos

In the Cape Coral direct sailboat access canal condo segment, which is a subgroup of gulf access condos and includes canals with no bridges for boaters to go under to reach open water, the monthly supply of unsold condos came in at only 2 months in September. This was 60 percent lower than the 5 months of unsold supply in September 2020, and 33.33 percent below the 3 months of supply in August of this year. In the third quarter of this year, the unsold supply of condos in this segment averaged 2.33 months, which was 53.4 percent below the average of 5 months of supply in the third quarter of 2020, but 39.5 percent higher than the average of 1.67 months of unsold supply in the second quarter of this year. In the first nine months of this year, the unsold supply of direct sailboat access canal condos averaged 2.44 months, or 68.6 percent less than the average of 7.78 months of supply in the first nine months of 2020.

Dry lot condos

In the Cape Coral dry lot (non-canal) condo segment, the monthly supply of unsold condos came in at 3 months in September, which was 40 percent lower than the 5 months of unsold supply in September 2020, but even with the 3 months of unsold supply in August of this year. In the third quarter of this year, the unsold supply of condos in this segment averaged 2.7 months, which was 60 percent lower than the average of 6.7 months of supply in the third quarter of 2020, but 35 percent above the average of 2 months of unsold supply in the second quarter of this year. In the first nine months of this year, the unsold supply of dry lot condos averaged 3.1 months, or 54 percent less than the average of 6.8 months of supply in the first nine months of 2020.

The sales data for this article was obtained from the Florida Realtors Multiple Listing Service Matrix for Lee County, Fla., as of Nov. 1, 2021, unless otherwise noted. 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 42 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.