Flipping through the newspaper or a Real Estate magazine, you have probably seen this question addressed in a variety of ways. What most people don’t understand is the answer depends on the area, price range and type of home you are looking for. Homes in northern states can be in a completely different market status than homes in southern states. Even homes within the same area can fall into different market conditions due to the type of home or price range it falls under.
Before we get too far, lets review how we determine the market type and what it means to be in a Buyer’s vs Seller’s Market. To determine a market’s status, we first we break down the inventory of homes by location and price range. From there, we look at the average number of closings per month and the total number of homes currently for sale (our inventory). From this, we calculate the months of inventory we have for each price range.
You can think of the months of inventory as how long it would take to sell all of the homes in that price range, if no other home were to enter the market. For instance, a smaller number of month’s inventory means homes in that range would sell out quickly if no other listings came on the market in that price range. This indicates a higher demand than supply and often causes bidding wars between buyers. A situation like this is called a Seller’s Market, because the Seller has an upper-hand in the transaction.
The opposite is true for categories that have a larger number of months inventory. This is called a Buyer’s Market, where the supply is higher than demand, and the Buyer’s have more control in the negotiation process.
So, what type of market are we in on Sanibel and Captiva? We break it down by price range and type of home below.
Sanibel Single Family Homes
Single family homes on Sanibel have experienced a drastic change in market balance over the past year. Since last July, the market has flipped from a strong-moderate Buyer’s Market to a strong-moderate Seller’s Market at most price points. Looking at the chart below, you see that in July 2014, $400k-$599k was the only price point considered to be in a Seller’s Market. Anything between $600k-$799k was a fairly Balanced Market, and the remaining price points favored a Buyer’s Marketplace.
Looking at the numbers for July 2015, however, we see the market flip where now everything under $1Million is in a Seller’s Market, $1Million-$1.9M is a Balanced Market, and $2Million+ is the only price point that is still considered a Buyer’s Market.
Looking at the same chart for condos on Sanibel, we see a similar shift in the market, though not as drastic. In July 2014, $0-$399k and $800k-$1.9M were in a Balanced Market, and anything between $400k-$799k and above $2M was considered a Buyer’s Market.
As you can see in the chart above, the numbers for July 2015 favor a Seller’s Market in three different price ranges and a Balanced Market for two price points. In fact, the only price range still considered to be a Buyer’s Market is anything listed between $800k-$999k.
Captiva Single Family Homes
A Note About Captiva Statistics: Captiva is a much smaller market than Sanibel. This is problematic when we try to analyze trends because a handful of transactions causes big swings in the statistics. We still review the numbers for Captiva, but in our opinion, they are somewhat less meaningful than for Sanibel.
You’ll notice the price ranges for single family homes on Captiva are higher than Sanibel, and even the two lowest price points have little to no inventory. Over the past year, the market has remained steady for Captiva single family homes. Generally, anything under $1M is a Seller’s Market, and anything over that price point is a Buyer’s Market.
Condos on Captiva have a similar price range as those on Sanibel; however, there are far few units. Captiva condos have not yet seen the shift from a predominately Buyer’s Market to a Seller’s Market like Sanibel has seen. Looking at the chart below, we see that anything below $800k has been and remains a strong Buyer’s Market. In July 2015, we see homes between $800k-$999k and anything above $2M shift to a Seller’s Market, because there is very few inventory at those price points.
As you can see, whether you are in a Buyer’s or Seller’s Market depends on your price range and the type of property you are looking at. If you’re interested in finding out more information about our market, don’t hesitate to call us at 239-472-1950. You can also Click Here to check out our online Market Report, which is updated with the latest MLS statistics monthly.