Geri and Bob Quinn

From a technical standpoint, our condo market remains in an abnormally low inventory seller’s market, however, the numbers appear to be showing early signs that a market shift could be in the works.

As we show below, the number of active Cape Coral condo listings through a Realtor in the Multiple Listing Service is currently running 66 percent above the number of active listings on the market from a year ago, but they are still some 44 percent lower than the 149 active condo listings from about 15 months ago on Jan. 31, 2021. So our active listings are up sharply from a year ago, but still substantially below anything close to resembling “more normal” inventory levels of the past.

We also show the monthly supply of unsold condo numbers as provided through the MLS for the month of March and for the first quarter of this year, with a look back at the past two years to help illustrate the prior market shift from a higher supply to our current abnormally tight level of condo inventory.

Under normal circumstances, we would probably just consider some of these technical shifts in our market data patterns as the typical seasonal ebb and flow and not give them a second thought. But in an abnormal world with major shifts occurring in various market and economic fundamentals, this is beginning to look like it could be something more than a historically aligned seasonal blip on the radar screen. As we noted last week, so far this year condo sales have been declining versus last year, while median sales prices have remained elevated, with this trend continuing into the month of April based on the preliminary market numbers we are seeing. Anecdotally, the vibe of the market seems to be taking on a different feel than a year ago, as we continue to see a lot of out-of-town buyer interest, but the pace seems to be slowing a bit, especially with higher priced properties.

This makes some sense based on the fact that inflation is running at 40-year highs, and according to Freddie Mac, last week interest rates on 30-year fixed rate mortgages reached their highest levels since 2009, hitting an average 5.27 percent versus 2.96 percent a year ago. With the Federal Reserve seemingly committed to its policy shift of raising interest rates in an attempt to reign in the out-of-control inflation levels, along with growing talk of a looming recession and asset bubbles, it is no wonder that consumer sentiment surveys are turning more negative towards home purchases and mortgage financing. Based on this, one might logically anticipate a flattening out of home prices at best, with at least some level of a price decline seeming more likely. The question would seem to revolve around whether it will be a rational or irrational shift in values and pricing. We will dig deeper into this topic next week, but for now, here are more condo numbers for both March and the first quarter.

As of Tuesday, May 10, there were 83 active condo listings through the Multiple Listing Service in Cape Coral with asking prices ranging from $159,000 to $2.2 million. There were a total of 21 condo units priced below $250,000 with only five of these units priced below $200,000. At the other end of the spectrum, there were two condo units listed for sale at $1.35 million and above, with another nine units were listed between $605,900 and $978,000. The current median list price for Cape Coral condos is $299,900. There were 103 condos under contract with buyers as pending sales in the Cape, ranging from $129,900 to $1.495 million. The second lowest priced pending sale was at $160,000 and there were a total of 14 units under contract below $200,000 with only two units above $1 million. There are currently no condos through the MLS in the Cape shown as foreclosures or short sales.

Looking back a year ago on May 11, 2021, there were 50 active condo listings through a Realtor in Cape Coral at list prices that ranged from $102,000 to $800,000. At that time, there were 148 condos under contract as pending sales. There was one additional listing and no pending sales showing in the system as a foreclosure.

In the overall Cape Coral condo market, the monthly supply of unsold condos came in at 3 months in March, which was 50 percent higher than the 2 months of unsold supply in March 2021, and even with the 3 months of supply in February of this year. In the first quarter, the overall unsold supply of condos in the Cape averaged 2.67 months, which was 27.2 percent below the average of 3.67 months of supply in the first quarter of 2021, but 33.5 percent above average of 2 months of unsold supply in the fourth quarter of last year. Of note, back two years ago the unsold supply was substantially higher at an average of 6.33 months for the first quarter of 2020, while coming in at 5 months for the month of March of that year as the COVID-19 shutdowns were first taking hold.

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 3 months in March, which was 50 percent higher than the 2 months of unsold supply in both March 2021, and in February of this year. In the first quarter, the unsold supply of condos in this segment averaged 2.33 months, which was 30 percent less than the average of 3.33 months of supply in the first quarter of 2021, and 12.7 percent below the average of 2.67 months of unsold supply in the fourth quarter of last year. By comparison, back in the first quarter of 2020 the unsold supply averaged 6.67 months, after coming in at 5 months in March of that year.

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 boater’s to go under to reach open water, the monthly supply of unsold condos also came in at 4 months in March. This was 100 percent higher than the 2 months of unsold supply in both March 2021, and in February of this year. In the first quarter, the unsold supply of condos in this segment averaged 3 months, which was 9.9 percent below the average of 3.33 months of supply in both the first and fourth quarters of 2021. Back in the first quarter of 2020, the supply of unsold condos in the Cape averaged 7.33 months, after coming in at only 5 months in the month of March of that year.

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 March, which was even with the 3 months of unsold supply in both March 2021, and in February of this year. In the first quarter, the unsold supply of condos in this segment also averaged 3 months, which was 35.8 percent lower than the average of 4.67 months of supply in the first quarter of 2021, but 79.6 percent above the average of 1.67 months of unsold supply in the fourth quarter of last year. Looking back to the first quarter of 2020, the level of unsold supply averaged 6.33 months for dry lot condos, after coming in at 6 months in the month of March of that year.

The sales data for this article was obtained from the Florida Realtors Multiple Listing Service Matrix for Lee County, Fla., as of May 2, 2022, 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.