October 2024 Real Estate MARKET UPDATE

BY: D. MICHAEL BURKE & HUNTER D. HABIB

As we move into October 2024, the Southwest Florida real estate market continues to show signs of adjustment following a dynamic year. After several months of steady declines in active listings, the market has finally seen a slight uptick in inventory, with 15,745 active listings as of October 3rd. This is the first increase in available properties since early summer, following a decline from 17,022 active listings on June 4th to 15,256 listings by September 3rd. This slight rise could be an early indicator of a shift in the market’s supply trends as we head into the fall.

Price Reductions on the Rise

In the past week alone, there have been 1,126 price decreases across the region. Sellers are responding to the longer time it’s taking for properties to sell, as well as the increased inventory levels. For buyers, this presents an opportunity to find more favorable pricing, while sellers may need to adjust their expectations to align with the current demand.

Inventory and Supply

The months of supply in both Lee and Collier County has steadily declined since peaking in March 2024. Lee County is now at 6.1 months, while Collier County sits at 6.4 months. Although this points to a shrinking market in terms of available homes, other factors like longer days on market and rising price reductions suggest we may be entering a more balanced or even buyer-favored market.

Days on Market on the Rise

Properties in both counties are taking longer to sell. In Lee County, homes are now staying on the market for an average of 77 days, while Collier County has seen this number climb to 87 days. These figures reflect a slower pace of transactions as homes are taking longer to sell, even with price adjustments and a slight rise in listings.

Snowbird Season Is Approaching

With snowbird season just around the corner, we typically see a 20% increase in inventory during this time. For homeowners thinking about selling, this means more competition is coming. If you want to get the most exposure and attract serious buyers, the sooner your property hits the market, the better. Early listings may stand out before the influx of seasonal inventory.

Bracing Through Two Storms: Hurricane Helene & Hurricane Milton

In recent weeks, Southwest Florida has weathered not one but two hurricanes. Hurricane Helene brought flooding to coastal areas, while Hurricane Milton last week added more damage and cleanup to the region. Although Milton was not as devastating as Hurricane Ian, it caused more widespread damage than Helene. While coastal areas are in recovery mode, the good news is that many inland areas remain largely unaffected, and efforts are underway to restore the impacted zones. The real estate market has shown resilience despite these challenges, with strong demand continuing for unaffected properties.

Federal Reserve Rate Drop

In a move that could significantly impact the housing market, the Federal Reserve recently dropped rates by 0.5 basis points, exceeding the anticipated 0.25 basis points. With more rate cuts expected over the next 12 months, this could put downward pressure on mortgage rates, potentially lowering borrowing costs. If mortgage rates decline, more buyers may enter the market, increasing demand and sparking activity.

Conclusion

Southwest Florida’s real estate market is in flux, with inventory slightly increasing, price reductions becoming more common, and days on market rising. As snowbird season approaches and recovery continues from Hurricanes Helene and Milton, homeowners and buyers must stay informed to navigate the changing market effectively. The Federal Reserve’s recent rate drop adds further complexity, with the potential for lower mortgage rates driving more buyers into the market.

Stay tuned for more updates as we continue to monitor these market changes!