August Real Estate Market Report: Low Inventory, Strong Demand

Demand for homes in Collier County kept REALTORS® busy in August, even as inventory dropped 77.3 percent to 1,249 homes from 5,503 homes in August 2020. According to the August 2021 Market Report released by the Naples Area Board of REALTORS® (NABOR®), which tracks home listings and sales within Collier County (excluding Marco Island), REALTORS® escorted buyers on over 30,000 home showings in August! The month’s strong showing activity—coupled with a 76.8 percent decrease in days on market to 22 days—means most homes were listed, shown, and sold in less than 30 days.

“Pent up buyer demand that began last summer has stretched inventory thin,” said Mike Hughes, Vice President and General Manager for Downing-Frye Realty, Inc., who added that “this could lead to upward pressure on pricing.”

Historically, median closed prices of homes sold during summer months tend to be lower than median closed prices of homes sold during high-season months (January through April), but that trend did not occur this year.

According to the report, the median closed price reported in August was $75,000 higher than the median closed price reported in January 2021. The median closed price of homes sold increased 11.7 percent in August to $441,300 from $395,000 in August 2020 (median price is the price at which 50 percent of the homes sold were above that price, and 50 percent were below).

Molly Lane, Senior Vice President at William Raveis Real Estate, said, “With the help of a REALTOR®, homeowners who sold a home in August most likely enjoyed a nice profit. That’s because local REALTORS® understand the market and can help price a home correctly, screen out unqualified buyers, assist in negotiating repairs and contingent offers, evaluate the offers presented and negotiate the best possible terms for the homeowner.”

According to Adam Vellano, a Naples Sales Manager at Compass Florida, “Our area consistently enjoys about 1,000 new listings every month. But demand is simply outpacing supply today. The 992 new listings added during August will most likely be sold in less than a month.”

Vellano’s comment was confirmed by the August Market Report as days on market in August decreased 76.8 percent to 22 days from 95 days in August 2020. As such, many of the 1,101 pending sales reported in August were also included in the report’s 1,033 closed sales figure.

Pending and closed sales, incidentally, decreased by 25.6 and 7.9 percent in August, respectively. Broker analysts predict pending and closed sales will continue to decrease in comparison to past years because of limited inventory.

Added Hughes, “It’s unlikely we’ll see a huge incline in inventory anytime soon.” He also noted that “historically, our area’s inventory increases during October and November in anticipation of seasonal residents during the winter, but demand is so strong now that we could absorb those homes if they were listed today.”

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