Foreclosures in Naples Florida

Looking At The Market Shares

Foreclosures in Naples Florida dominate our market.  On June 29, 2011 over half of all homes under contract were designated either “potential short sales” or “foreclosed”.

Active MLS Listings

Lets look at the numbers.  Today, there are 6,252 active listings in the Naples MLS.  Of those, there are 736 that area designated as “potential short sales”.  Almost 12% of the homes for sale in Naples are short sales.  On foreclosures, there are 171; that’s 2.7% of the market offerings.  By these numbers, it doesn’t sound like foreclosures have that much share of the market.  Remember though, these are active listings, not listings under contract.

MLS Listings Under Contract

Now for that portion of the market that’s under contract.  There are a total of 2,048 listings either “pending” or “pending w/contingencies.  That’s 33% of the market that’s moving!  Out of that number, 1,082 are short sales, 184 foreclosures, and 782 traditional sales.  Respectively, that’s 52.8% short sales, 9% foreclosures, and 38.2% traditional sales.  Now we see that well over half the serious market is comprised of foreclosures and short sales.

Everyone would agree that foreclosures and short sales are probably priced better than the average traditional listing.  That’s because the bank is trying to move their property and stop their expenses, and the distressed homeowner is trying to get their home sold before the bank takes their home.

The homeowner is not holding out for an unrealistic price;  he wants to salvage his financial reputation as much as possible. Whether his home sells for 5% lower or 5% higher is not his main concern.  He is trying to beat the deadline.

Many of the “traditional listings” are those homeowners who want to “test the waters” to see if they can get a better than average price.  So some of the active listings you’ll see in our MLS are not serious sellers today.

Short Sales History

When  real estate prices their free fall back in 2007 short sales were yet common, nor streamlined.  You had to have nerves of steel to survive the ride.  Many buyers withdrew their offers after weeks or months of silence from the banks, and very few ever closed.

In 2007 there were only 10 short sale listings that closed in the Naples MLS.  2008 saw a  jump to 215 sales.  Then in 2009 it surged ahead to 1,490.  Finally in 2010 there were 2,192 short sale closings.  At the half way point this year we are at 1,030.   Short sales may have leveled off, but they are easier than ever to achieve with the help of  a good REALTOR®

As you can see from the chart below, short sales listings are on the market the longest.  Some of this is due to the way the agent has to market this property.  The investor is not going to agree to lose money unless he has proof that the agent set the price at comparable market levels and then systematically reduced the price until offers came in.  Compared to REO properties, this marketing approach will take longer.

And yes, a short sale offer does take longer to get a reply than an REO offer, but in our experience it isn’t that much longer.  The number of REO properties are way down, the demand is high, and short sales will be filling that demand.

Get Prepared Before You Make An Offer

Get prepared before you make an offer if you want to compete for the lowest priced and best of properties in Naples.  Finding the property you really want  is going to require an advanced search tool-we have it.  Preparing your financial paperwork in advance is a must-we can guide you through those steps.  Understanding market conditions will make you a wiser buyer-get those stats from us.  Finally get on board with a knowledgeable Realtor-again, that’s us!

NaplesMlsHomes.com makes it easy to find the property you want.  We give you many powerful tools that most real estate sites don’t offer.  Plus, we are only a phone call away if you still have questions.  It’s all part of helping you get prepared before you make an offer.

Once you realize you are serious about buying a home in the Naples Florida area you’ll need to have your financial paperwork in order.  There are many good deals in our market now, and when you’ve found the one you want to make an offer on you don’t want to lose it.  Get prepared before you make an offer.  If the property you want is a foreclosure or short sale the bank will want proof of funds along with your offer.  Even if the property you make an offer on is not a foreclosure or short sale, your offer will be stronger if you are competing with another offer that isn’t as prepared with their finances.

Proof of funds usually requires a letter from your bank stating that you are approved for a loan up to a certain amount and must be on the bank’s letterhead.  You will also need to submit copy of your most recent bank account showing that you have the necessary funds.  The letter from the bank  should  be dated within the last 30 days.

Understanding the market conditions in Southwest Naples Florida is very important and is key in helping you get prepared before you make an offer.  Sometimes we talk with customers who want to offer 50% of the listing price on a place they really want.  It is very rare that you’ll even get a response back from the seller on a 50% offer.  Meanwhile other offers come in and the hopeful 50% buyer loses another deal. Think about the statistics in the next section.  Call us, and we can work up stats for many different scenarios.

Closing since Jan 1, 2010

Foreclosures:  2,691 closings – SP/LP was 98.54%  (sales price divide by list price = SP/LP)_
Short Sales:  1,988 closings – SP/LP was 94.4%
All Sales (Includes foreclosures & short sales):  11,815 closings – SP/LP was 96.6%

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