by Mike Colpitts 
The home inventory finally drops, with homes, condos and other properties listed for sale in the Fort Myers region.
- The number of properties ballooned to 9,348 at the end of September before finally declining in Cape Coral, Fort Myers, Naples and other surrounding communities.
- Home prices are also declining as the housing market makes inroads to stabilization in the local area.
The number of homes listed for sale in Florida finally drops after more than two years of rising, according to a highly regarded real estate research firm. Altos Research says sellers are removing their homes from the market at an increasing clip.
At the end of September the inventory of homes, condos, townhouses and manufactured homes listed for sale in Lee and Collier counties stood at 9,348, which includes Fort Myers, Cape Coral and Naples. The figure is from data derived from the Royal Palm Coast Realtors Association. It was the highest inventory listed for sale on the market in more than five years.
Altos Research CEO Mike Simonsen says the drop signals the fact that sellers are not finding the same kind of reception to higher prices found earlier in the year. Higher mortgage rates ushered in by the Federal Reserve’s rate hikes slowed home sales. The slowdown in sales began to develop in the Fort Myers region shortly after Hurricane Ian hit the area three years ago, pushing it into one of the earlier slowdowns.
The home inventory finally drops across Florida, “finally declining after two full years of consistently rising,” Simonsen said. The combined market inventory of properties in Lee and Collier counties bottomed out at 3,846 in July 2021 when home sales were at the highest monthly volume as a result of the Covid pandemic. Thousands of newcomers from Northern states moved to the Fort Myers area seeking warmer weather and a better lifestyle when they could work remotely.
In March 2020, the World Health Organization officially declared the COVID-19 outbreak a pandemic. Health organizations ordered a shutdown in the U.S. as more than 1.1 million Americans died in the U.S. alone from Covid. Workers were forced to stay home for lengthy periods of time until in May 2023, when WHO declared an end to the public health emergency of international concern.
Home prices were already inflating at a rapid rate as Florida was one of the first states to allow workers back to their offices and children back to school. Home values had ballooned with record low mortgage rates.
The decline in home sales that resulted from higher mortgage rates is also beginning to change as more home shoppers make efforts to enter the market. Pre-qualifications are increasing as the Fed has announced that is on an interest rate cutting trend in efforts to stabilize markets and limit inflation.
Home sales fell in September during the height of the summer hot spell when sales of homes are usually slower in the Fort Myers area. Only 1,281 homes, condos, townhouses and manufactured properties closed in Lee County. The majority of properties sold were single family homes, with 974 closing in September.
The Fed’s cut in interest rates is expected to be gradual and impact real estate markets slowly as the Federal Reserve makes more cuts in coming months. Home prices are declining in the area as the home inventory finally drops.
Housing markets are creatures of economic fluctuations and local economic changes. The U.S. had witnessed a wide-ranging real estate boom for more than a decade with record low mortgage rates. Home prices in some areas of Fort Myers and surrounding communities have doubled in the last 15 years.
The inventory of properties listed for sale substantially increased the most from July 2021 to August 2022 when 5,493 homes, condos and other properties were listed for sale. As the inventory decreases, home prices decline and sales increase the market will gradually make inroads to stabilize.