The Lee Building Industry Association (Lee BIA) and the Collier Building Industry Association (CBIA) hosted their 5th Annual Market Trends Seminar on November 4, 2015. The event is one of the region’s largest programs of its kind and attracts industry professionals from all over Southwest Florida. The seminar was held at the Miromar Design Center in Estero, FL. Randy Thibaut, Owner and CEO of Land Solutions, Inc. was the featured guest speaker.
Land Solutions, Inc. is a Southwest Florida land and commercial real estate consulting and brokerage firm. Land Solutions has stayed on top of the real estate market and has continued to monitor the market to provide sellers and buyers, as well as other businesses in the industry, pertinent market trends. Randy Thibaut enlightened industry professionals as to what really happened in the residential new home/land market in 2015 and how it will affect your business now and into the future. It’s imperative as an industry professional to continue to track markets’ stats, so that Industry professionals will have enough time to recognize any risks and be able to prepare accordingly. To view the full report please click here.
Southwest Florida Home Market Is Continuing Stabilization
According to Randy, the home building industry continued to exhibit strong growth.
“We Are In A Market In Equilibrium”
An important indicator to monitor growth is permit volume. Building permits are an excellent predictor of market activity. Permit volumes have continued to upsurge in Southwest Florida as well as home prices. An important variable that will enable this upsurge is low interest rates. According to Land Solutions report “there were a total of 12,035 permits issued for new residential units in Collier, Lee and Charlotte counties combined over the past 12 months ending on September 30, 2015.”
Home inventory is rising in Southwest Florida to meet the seasonal demand. Southwest Florida continues to be a real estate hot spot and population continues to spiral upwards. This information hints at market equilibrium, when the supply and demand curves intersect (Demand=Supply). Unfortunately, if interest rates remain low for too long the market may be at risk again. What is your overall opinion on Southwest Florida being a market in equilibrium?
Land Solutions predicts that “the next twelve months calls for a 7%-11% increase in new residential home permit issuance, 3%-6% increase in home prices, continued tightening of the labor supply, moderately rising interest rates to near 4.25% by the end of the third quarter of 2016, increasing primary home demand and increasing multi-family demand.” (Land Solutions Market Trend Report)
Southwest Florida Population Levels Continue to Rise
Rising population levels are another variable that will positively affect the real estate and housing market. Lee, Collier and Charlotte County population levels continue to rise and future growth is expected in the area. Future Baby Boomers that are retiring will contribute to those population projections. Southwest Florida will always appeal to the Baby Boomer demographic, those who are looking for first class amenities, sunny beaches, and championship golf courses.
Collier, Lee, and Charlotte Population Growth:
|County||Year 2013||Year 2014||% Change|
The University of Florida’s Bureau of Economic and Business Research (BEBR) conducted a population projection report which can be seen below:
Lee, and Charlotte Population Projections from BEBR:
|County||2015 Estimate||2020 Projection||2030 Projection|
Florida Gulf Coast University – Another Economic Driver for Southwest Florida
Florida Gulf Coast University is another economic driver for Southwest Florida. FGCU is quickly attracting new students, which contributes to the overall population growth. “According to the Market Trends report conducted by Land Solutions, a study was conducted by a FGCU professor that found the university’s impact on the Southwest Florida economy for the 2012-13 academic year was approximately $422 million in overall expenditures, $154 million in labor income and is responsible for 3,723 jobs in Southwest Florida.”
Florida Gulf Coat University is Responsible for 3,723 Jobs in Southwest Florida
(2012-13 Academic Year)
Collier County Sales Trends in Southwest Florida
The National Board of Realtors released the October 2015 Real Estate Transactions Report, which states single family home Inventory is rising and that supply and demand are nearly balanced.
According to the National Board of Realtors:
- “Pending sales are up 21% in the $300K-$500K category 12-month ending 10/2015”
- “Closed sales are up 25% in the $300K-$500K category 12-month ending 10/2015”
- “Median Closed Price is up 11% in the $0-$300K category and 14% in the $2M+ category 12-month ending 10/2015”
- “Inventory is down 21% in the $0-$300K category and up 21% in the $2M+ category 12-month ending 10/2015”
- “Average Days on the market dropped 46% in the $1M-$2M category 12-month ending 10/2015”
Need Help Navigating Through the SWFL Real Estate Market?
Southwest Florida home buyers and Southwest Florida home sellers will experience some challenges in the next coming months. In order to bypass these expected challenges, hire a seasoned real estate professional that will guide you through the current Southwest Florida real estate market. There is no reason why you should navigate through this complex market alone.
Jill Kushner specializes in luxury real estate in The Colony, located in Bonita Springs. If you are looking for a luxury community with first class amenities and state of the art championship golf courses, contact Jill Kushner today.