By Michael Davis, owner of Worthington Realty
As Southwest Florida experiences record heat this summer, our local real estate market is heating up right alongside it.
Despite the challenges of the past year – a devastating hurricane, insurance claim delays, material shortages and more – property owners in our region have resiliently worked through post-storm recovery to get their properties back on track.
A look at markets previously impacted by hurricanes like Katrina, Harvey, Andrew and Charley shows that these regions experienced real estate booms in the years immediately following the storms. This is promising for Southwest Florida with more and more properties coming on the market as repairs are completed. More than 11 months post-Hurricane Ian, many owners and renters are finally nearing the finish line, which presents new opportunities for buyers and sellers alike.
Census data shows 674,740 people moved to Florida, an average of 1,849 people every day, making our region a lucrative destination for buyers, sellers, investors and rental property owners who are planning for the future.
There was an immediate decrease in inventory after the hurricane due to damage from the storm, yet the region has since made up for the decline. Inventory is starting to pick up – a healthy sign in the summer months and as we head into the market’s busy season in October. This is driven by people who hit pause on their plans to sell or who had to repair damage, and they are now putting their homes on the market. For those with undamaged homes, it was a sellers’ market due to a decrease in competition and an increased need for housing for those who were displaced by the storm.
Recent housing reports from Florida Realtor indicate improved statewide levels of inventory for single-family homes in Quarter 2, a 13.8% year-over-year increase.
Patti Beavers-Rhodes, a broker associate for Worthington Realty, is a 22-year resident of Southwest Florida. She and her husband and fellow Realtor, Steve, have been ingrained in monitoring market fluctuations, particularly in one of the communities that we specialize in, Lexington Country Club.
“Prior to the hurricane, in March-April-May, things were skyrocketing. Prices were almost where they were in 2006,” Patti said. “At that time, there was a big shortage of properties and high demand. It was a sellers’ market.”
After the hurricane, things came to a halt and listing prices for homes damaged by the storm were adjusted.
The market has since shown signs of rebound, and prices are starting to level out. The latest data from the National Association of Realtors shows median home values of $440,056 in Lee County and a slight increase in monthly mortgage payments due to rising rates.
The Rhodes are also seeing an increase in first-floor units on the market. Immediately after the hurricane, there was a hesitation for lower-level properties due to future flood risk. However, buyers are showing signs that they are moving past these fears and are ready to commit.
“As time moves on, people are forgetting about that,” Patti adds.
Lexington General Manager Chris Alvarez agrees, anticipating a flurry of buying activity for first-floor units that were damaged by flood waters.
“A lot of members are buying up units that were abandoned and then they’re reselling them,” Alvarez said. “When insurance claims come back for some of these units, I think we’ll see many on the first floor that will do the Lexington shuffle to find units with higher ground, so we may see some movement in first-floor units being sold in the next several months.”
The insurance landscape will continue to impact the next steps for property owners. With insurance claim delays, many owners have been left to navigate out-of-pocket funding for homes that needed remediation and remodeling. For owners of older properties and those repairing and planning to sell, there is a good opportunity for remodel upgrades to drive a higher selling point and increase potential gain on investment.
As we continue through the latter half of 2023, there’s potential to see our region continue to heat up and make a shift to a buyers’ market.
About the Author
Michael Davis is owner of Worthington Realty, a boutique real estate company specializing in residential sales, rentals and development across Southwest Florida. For more information, call 239-437-3334, email email@example.com or visit WorthingtonRealty.com.