While passing by a gas station recently, local real estate broker Denny Grimes took notice of the digital billboards displaying gas prices that have been soaring over the last few weeks. At that moment, with the skyrocketing cost of single-family homes in 2021 on his mind, he thought of putting digital boards on for-sale signs all over Southwest Florida.
Those updating the prices on the signs each day would have been busy during 2021, what the president of Denny Grimes & Team at Keller Williams Realty on Wednesday called “the greatest market that ever was.” Grimes outlined just how off the charts last year was for residential real estate in the area, how it will never be repeated, whether the market will soften for buyers or if the bubble will burst completely while speaking at Market Trends of Southwest Florida at Caloosa Sound Convention Center in downtown Fort Myers.
“Two thousand twenty-one was not a cliffhanger,” Grimes said, likening the record year where home prices in Lee and Collier counties increased 26% to a story that contained all the ingredients of an epic journey that had a clear conclusion. “Years in the future when you all are holding your grandbabies on your laps, you’ll tell them of the greatest market that ever was.”
It began in May of 2020 during the start of the COVID-19 pandemic into 2021 when Florida was only second to Texas in population growth. The average median price for a single-family home in the state rose to $375,000. Meanwhile, Collier ($722,500) and Lee ($413,500) counties eclipsed that mark. Charlotte County rose 28% to $353,000.
With the boom carrying into this year, it marks a time of unmatched prosperity for sellers, Grimes said. On the other hand, it is a time of great adversity for who he called the “tortured buyer.” Inventory has dropped 13% in Lee and 30% in Collier. His research found that not one single-family home less than $100,000 can be found in Southwest Florida.
That leads to a giant concern. The concern may not be a bubble burst, which requires excess inventory. However, there could be signs of a shift, he said.
“It’s not the mood of the seller but the mood of the buyer you need to watch,” Grimes said. He pointed to a time when there will be more listings coming in than going off. But Southwest Florida isn’t close to that point yet.
“There is fear in buyers that they’ll buy in right before the market crashes,” Grimes said, joking that it could be similar to the feeling experienced by the buyer of the football used during the “final” touchdown pass thrown by all-time great quarterback Tom Brady for $518,000 a day before Brady announced this week he was coming out of retirement to play another season and certainly throw more touchdown passes.
The market could also slow as COVID mandates begin to ease in cities all over the country and as the mid-term elections approach. However, Southwest Florida’s “warmth, water and way of life” and the region’s ability to preserve those attractions will maintain its status as a desirable location to live. There will still be demand, Grimes said.
“The market could slow,” he said, “but it won’t stop.”
