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Homing In | Cape’s Condo supply edges higher as interest rates ease

By GERI and BOB QUINN - Homing In | Nov 30, 2023

Geri and Bob Quinn

There has been a piece of good news as recent economic reports are showing the rate of increases to the inflation numbers have slowed. So based on the government’s inflation gauges, the higher prices we are paying for most things are not going up as fast right now as they did over the past several years.

This news was a cause for celebration by various economists, market analysts and some political pundits who are now certain, once again, that the Federal Reserve has won its war on inflation. Expectations are growing that the Fed will begin cutting interest rates in the first quarter of next year while avoiding anything that even remotely resembles a recession as it manufacture its elusive “soft landing” to the economy. This news has resulted in a sudden drop in the Benchmark 10-year Treasury yield from around 5% to about 4.3%, with 30-year mortgage rates following suit by dropping from the 8% range, which was their highest rate in the last 23 years, to somewhere in the 7.5% range. Whether this turns into a full Fed pardon from its “higher for longer” interest rate scenario, or just another eleventh hour reprieve, is yet to be determined.

The main takeaways from the Cape Coral condominium market, as shown in the numbers below, are that the current inventory of condos sitting unsold on the market continues edging higher as the pipeline of pending sales softens. This continues to put pressure on prices, as the top daily market statistic remains the number of price reductions being made by sellers as they struggle to attract a buyer, which is a complete reversal from the wild bidding wars of the sellers market two years ago to the slower, higher inventory buyers market of today.

As of Monday, Nov, 27, there were a total of 363 Cape Coral condo units listed for sale through a Realtor in the Multiple Listing Service at prices ranging from $159,250 to $1.75 million, versus 361 listings two weeks ago. Of note, the formerly highest priced condo in the Cape, which had been listed at $3.9 million, is no longer on the market after going 280 days without being sold. The current median list price for condos came in at $299,900 versus $300,000 two weeks ago. One year ago on Nov. 28, 2022, there were only 148 condo units listed for sale from $159,900 to $2.195 million with the median list price at $315,000. So the number of condos listed for sale in the MLS is up 14 % in the past twelve months.

There are currently 43 condos under contract with buyers as pending sales at prices ranging from $120,000 to $1.195 million, down from 46 pending sales two weeks ago. The second highest priced pending sale for a condo in the Cape is at $659,500 and the third highest is at $450,000 with the median pending sales price coming in at $287,000. A total of 72% of our pending condo sales are priced at $325,000 and under. One year ago there were 69 condos in the pipeline as pending sales at prices ranging from $149,900 to $1.65 million. So our pending condo sales are running about 38% below their level from a year ago.

In the overall Cape condo market, there were 34 closed sales in the month of October, which was 6.3% higher than the 32 closed condo sales in the immediate aftermath of Hurricane Ian in October 2022, but 29.2% below the 48 sales in September of this year. In the first 10 months of 2023, a total of 447 condos were sold overall in the Cape, which was down 24.4% from the 591 condo units sold in the first 10 months of 2022.

The October median sales price was $265,000 for the overall Cape condo market, which was 1% above the $262,500 posted in October 2022, but 4.1% below the $276,259 in September of this year. In the first 10 months of 2023, the median sales price averaged $279,773 per month in our overall condo market, or 2% above the average of $274,275 per month in the first 10 months of 2022.

Gulf access canal condos

In the Cape Coral gulf access canal condo segment, which includes all “saltwater” canal condos, there were 13 closed sales in October, which was 13.3% lower than the 15 condos sold in October 2022, and 35% below the 20 sales in September of this year. In the first 10 months of 2023, a total of 201 saltwater condos were sold, or 26.1% less than the 272 sales in the first 10 months of 2022.

The October median sales price came in at $390,000 for the Cape’s saltwater canal condo segment, which was 30% above the $300,000 posted in October 2022, and 35.1% higher than the $288,750 in September of this year. In the first 10 months of 2023, the median sales price averaged $345,516 per month, or 5.5% higher than the average of $327,500 per month in the first 10 months of 2022.

Direct sailboat access canal condos

In the Cape Coral direct sailboat access canal condo segment, which is a subgroup of gulf access condos where boaters have no bridges to go under in the canal system, there were 4 closed sales in October. This was down 50% from the 8 condos sold in October 2022, and 63.6% below the 11 units sold in September of this year. In the first 10 months of 2023, a total of 108 sailboat canal condos were sold in the Cape, or 34.9% less than the 166 sales in the first 10 months of 2022.

The October median sales price came in at $505,000 in this segment, which was 54.7% above the $326,500 posted in October 2022, and up 66.1% from $304,000 in September of this year. In the first 10 months of 2023, the median sales price in this segment averaged $393,885 per month, or 8.4% higher than the average of $363,420 per month in the first 10 months of 2022.

Dry lot condos

In the Cape Coral dry lot (non-canal) condo segment, there were 20 closed sales in October, which was 42.9% higher than the 14 condos sold in October of 2022, and even with the 20 sales in September of this year. In the first 10 months of 2023, there were a total of 200 dry lot condos sold in the Cape, which was 25.1% below the 267 dry lot condo units sold in the first 10 months of 2022.

The October median sales price was $225,500 for the Cape’s dry lot condo segment, which was % lower than the $230,000 posted in October 2022, and 11.6% below the $255,000 in September of this year. In the first 10 months of 2023, the median sales price for dry lot condos in the Cape averaged $244,269 per month, or 6.1% more than the average of $230,278 per month in the first 10 months of 2022.

The sales data for this article was obtained from the Florida Realtors Multiple Listing Service Matrix for Lee County, Fla., as of Nov. 26, 2023, 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 44 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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