Bob and Geri Quinn

As we sifted through the preliminary single-family home sales numbers in Cape Coral for the month of November, the good news was the number of closed home sales were up 28.6 percent over the post-Hurricane Ian depressed number of only 220 sales in October. Even though this was just a baby step in the right direction, it looks like we may have put in a bottom for post-storm closed home sales. However, the combined number of closed sales in the months of October and November will be the lowest recorded since back in 2012 and 2013.

We continue to see a decent amount of interest from serious out-of-town buyers searching for homes over the Internet, with some of these buyers looking to buy now, while other interested buyers tell us they are monitoring the price action in our market to see if lower prices and better deals are on the horizon. We are also being bombarded daily by telephone solicitations, text messages, emails and direct snail mail solicitations from investors looking to scoop up storm damaged distressed properties, or any homes that have been sitting on the market unsold, at bargain basement prices.

As far as home prices are concerned, they are now coming under some pressure from the “as is” clearance sales of storm damaged homes being sold at big discounts. The preliminary median sales price in the Cape dipped to $400,000 in November as our market seems to be going through a shake out period. This is bringing the median sales price back down to this year’s previous monthly lows for median sales prices from back in January ($396,000) and February ($400,000), but we are still holding above the $378,525 registered in November 2021. On a positive note, as shown in the data below, the median list price has been holding firm after weakening from its highs earlier this year.

Moving forward, we are expecting the number of home sales to remain much lower than we have seen since the second half of 2020, when the record setting post-COVID lockdown housing boom took hold. We also think home sales will find their new post-Ian equilibrium level and stabilize in 2023, as the storm recovery continues. With the beaches closed and an even more limited supply of available rental properties than normal, this will likely be an abnormal tourist season with the crowd of out-of-town storm workers squeezing out would-be vacationers. As evidence of this we would point to media reports from the Pink Shell Resort on Fort Myers Beach, where they are hoping to open a section of rooms soon so storm-related workers have a place to stay, while indicating it will probably be two years before they are back open for their regular vacationing tourists.

The other big wildcard for our market will be from the outside influences of the U.S. economy, which is widely expected to suffer from a recession in 2023. The expert predictions about inflation, interest rates and the potential severity of a looming recession are all over the place. Trying to compare the current business and economic cycle to past cycles and recessions is probably a fool’s game as the Fed is trying to unwind its unprecedented easy money, zero percent interest rate policies that have been in place for most of the last 12-plus years in order to try to rein in inflation. It is anybody’s guess how this will ultimately play out, but there are some pretty serious people out there who are predicting a very rough ride for the economy, the job market and the housing market next year.

This brings us to the topic of local real estate market predictions, some of which are trying to compare the recovery process from Hurricane Ian to past hurricane recoveries. It is easy to look back at Hurricane Charley in August 2004, and Irma in September 2017, and then track the post-hurricane real estate booms following those storms. Taking these storms as examples of “this is what the real estate market does after a hurricane hits” and extrapolating that expectation to our current situation is likely to be a bit of a stretch this time around. The first thing we would note is the differences in the type and level of storm damage from Charley, Irma and Ian. Irma’s big surprise was mostly tied to costly seawall damage to around 1,000 properties in the Cape and some roof and pool cage damage. Charley was far worse than Irma, with a lot of roof and pool cage damage, power poles snapped in half, tree damage and some lengthy power outages in some parts of the Cape. But neither of these storms scored a direct hit on the Cape.

For its part, Ian added a life-changing catastrophic storm surge to the equation at a time when our housing market was already slowing down, inflation was running rampant at 40-year highs and with the economy appearing to be teetering towards a recession. On top of that, the Florida property insurance market is currently in a deepening crisis, while flood insurance rates are rising, and the FEMA 50 percent rule is complicating matters as people try to rebuild. These are completely different dynamics on every level compared to Charley and Irma, which leads us to believe that the pace of the real estate market in this storm recovery process is likely to be different. We hope our analysis of the situation is wrong.

Here is a snapshot of our current market as of Tuesday, Dec. 6, where there were 1,326 active Cape Coral single-family homes listed for sale through a Realtor in the Multiple Listing Service at prices ranging from $225,000 to $4,999,999. The median list price was $500,000 which is the same level it was at on Nov. 22, when there were 1,320 active listings with the lowest priced home at $240,000. A total of 537 homes, or 40.5 percent of the active listings are priced at $450,000 and under, with 367 of these at $400,000 and under, including 14 homes priced below $300,000. At the other end of the spectrum there are 140 homes in the Cape listed at $1 million and above. There are currently 555 pending sales in the pipeline at prices ranging from $170,000 to $1,699,900. A total of 372 homes, or 67 percent of the pending sales are priced at $450,000 and under, with 275 of these at $400,000 and under, including 29 homes priced below $300,000. There are only 16 home sales pending at $1 million and above in the Cape, equalling 2.9 percent of the 555 homes under contract with a buyer.

Just over a year ago on Nov. 29, 2021, there were only 521 active listings in the MLS for Cape Coral single-family homes at prices that ranged from $255,000 to $5.995 million. The median list price was $508,000 a year ago before running up to its peak of $610,000 on April 19 of this year (based on our weekly market surveys), so we have completed a “round trip” with the current median list price back down to $500,000. A year ago there were only 67 homes in the Cape listed at $1 million and above, and we had 1,035 pending sales in the pipeline with 38 of these pending sales priced at $1 million and above.

The sales data for this article was obtained from the Florida Realtors Multiple Listing Service Matrix for Lee County, Fla., as of Dec. 6, 2022, 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 43 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.