March 2023 home sales fell by 17% from 2022.

In the first quarter of 2023, more homes were sold in Naples than in the first quarter of 2019 (before COVID), when there were almost three times as many homes on the market. According to the March 2023 Market Report by the Naples Area Board of REALTORS® (NABOR®), which keeps track of home listings and sales in Collier County (except for Marco Island), the total number of houses on the market rose by 92.4 percent from March 2022 to March 2023, from 1,507 to 2,900. Even though the number of homes for sale in Naples is still historically low at 3.6 months, it has been going up since December 2021, when it was at its lowest point at 0.8 months.

Mike Hughes, Vice President and General Manager for Downing-Frye Realty, Inc., and other broker analysts who looked at the report think that “even though buyers face headwinds like high interest rates, rising property and flood insurance rates, and low inventory levels, these things are not making people less interested in living in Naples.”

Cindy Carroll, SRA, of Carroll & Carroll Appraisers & Consultants, LLC, who is against comparing activity today to activity during the COVID-boom years (2020-2022), said that she is “comforted by the fact that our area shows resilience to 2019.” Homebuyers shouldn’t put too much stock in the number of months of inventory given because it changes a lot based on where in Naples you want to buy a home. For example, there is enough food in the Port Royal area to last 1.3 years. The truth is that we are headed back to 2019, when the home market was stable, logical, and built on solid ground. That’s what should be happening, and it is.”

Using this more accurate way to measure, the number of closed sales dropped by 16.5% from 1,218 in March 2022 to 1,017 in March 2022. However, compared to March 2019, the number of closed sales went up by 2.6%. In March, there were 1,377 pending sales, which is 14.5 percent less than in March 2022, when there were 1,611 pending sales. However, pending sales were 22% higher in March 2019 than they were in March 2022.

Even though the number of new listings didn’t change much in the first quarter of 2023, Wes Kunkle, President and Managing Broker at Kunkle International Realty, thinks that some potential sellers in Naples are waiting to see if interest rates go down or a possible recession affects the value of their home before they decide to sell. From March 2022 to March 2023, the number of new listings dropped by 17.9 percent, from 1,667 to 1,369. However, the number of new listings dropped by only 2.5 percent from March 2019 to March 2023. But Adam Vellano, a Naples Sales Manager at Compass Florida, said, “The price drops reported in March were from sellers who didn’t price their homes competitively when they first listed them, but very few of these drops were below today’s comps.”

The NABOR® March 2023 Market Report compares sales of single-family homes and condos (through the Southwest Florida MLS), price groups, and geographic areas. It also gives an overview of the market as a whole. The NABOR® sales statistics are shown in charts, such as these general results for 2023 (for both single-family homes and condos):

From March 2022 to March 2023, the median sold price rose by 7.3%, from $573,000 to $615,000. This rise was caused by the apartment market, where the median closed price went up by 5.9%. In March, there was no change in the median closed price of single-family houses compared to March 2022.

Top brokers who look at the market report every month say that the Naples area home market can’t be put into either a buyers’ or sellers’ market right now. However an experienced Naples REALTOR® knows how the markets in each neighborhood are different and how to compare them.

Kunkle also said that it’s hard to decide to sell a home if you have a mortgage with a 3% interest rate and rates are now over 6%. But Freddie Mac says that the average fixed 30-year mortgage rate since 1971 has been 7.75 percent. Also, Sherry Stein, CRB, Managing Broker at Berkshire Hathaway HomeServices, was quick to point out that “the average sales price in Naples in March 2019 was $597,081, but today it’s $1,018,469.”

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