For Christmas I received a cool new pair of Kaenon sunglasses–really awesome eye-wear. They came with a large 8″x 8″ micro fiber cloth for cleaning. It wasn’t one of the typical lens cloths that barely fit over one lens. Immediately, I knew it would be perfect for shining away the year of grundge that covered my crystal ball.
So, as I rub away the shades of grey from my future-viewing device (aka crystal ball), I’ll share my thoughts about the future of Naples real estate for all parties in 2011.
2011 Overall – More of the Same. I hate to disappoint hold-out sellers or buyers who recently purchased Naples homes in the hopes of making a quick buck, but the local real estate market will continue to be a buyer’s market for the foreseeable future, well into 2011. Regardless of how market watchers skew the data (and believe me it can be dolled-up to make a bag-lady look like the next princess of England), there is still an overabundance of inventory along with distressed properties keeping downward pressure on real estate values.
Buyer’s Advice –You’re in the driver’s seat. Yes, there are a plethora of great deals to be had, but don’t let fear take hold an d make you wait it out for a “better” deal on the horizon. You have a better chance of winning Power Ball than you do timing the market to buy at rock bottom.
Instead of thinking you have to buy Naples homes or condos “under the market” (really a misnomer since the contractual price agreed to in an arm’s length transaction is the market) to cushion your purchase for fear of further declines, increase your time horizon. If you go into a purchase today with a time horizon of 4 to 5 years, you can be confident that your real estate investment is safe. I will go on the record here and say that a purchase today will conservatively increase in value 3% to 6% over the next 5 years in our area of Naples, Florida.
Seller’s Advice – Do you buy your stocks high and sell them low? Perhaps, but unless you have a compelling reason (see 4 below), “Do Not Sell Now!”
Legitimate reasons to sell now are: 1) Death, 2) Divorce, 3) Change in financial health, 4) You have your sights on buying a bigger, smaller or alternately located Naples home and wish to take advantage of deals available now. Go into this situation realizing that you may get less than you’d like for your existing property but knowing you will make up most, if not all, of the loss on the buy side.
A note on low-ball offers: I consider a low-ball offer to be 20% or more off the list price. As a seller, don’t be offended and take these offers as a personal assault on your home. Low offers are just part of the Naples real estate landscape today. I know this is easier said than done when it involves a home that you’ve spent a lifetime in or one that contains your life savings.
Try this to keep your cool and possibly turn a lump of coal into a diamond. Visualize the worst possible low-ball offer imaginable. Smile to yourself as you see yourself crossing out the unbelievably low number and counter offering 5% or 10% (within your comfort level) less than your list price. When it does happen (and it will) you will be prepared to take the emotion out of the equation and keep the communication open with the potential buyer.
Sellers keep this final thought in mind: Always, always counter an offer. You never know how high the home buyer is willing to go until you try.
Regardless of how much I polish my crystal ball with my new, extra-large micro fiber cloth, the truth is nobody really knows what the future holds.
What we do know for sure is that real estate markets will always be cyclical and that our local, Naples Florida home market will always have a bright future. Naples‘ proximity to the Gulf of Mexico combined with low-crime, pristine streets, average temps of 75 degrees Fahrenheit and limited new waterfront property will keep people flocking to the area and property values trending up for decades to come.