This week’s episode of “American Dream Home” on FOX Business Network took viewers to Sanibel Island, Florida.
What I enjoy most about this show – in addition to meeting the families we identify – is being able to explore the real estate market that has not yet received national attention. This is a Sanibel moment.
Homes sell, on average, about 12 days after listing.
Since we joined forces with Lisa and Keith, an Ohio couple who left the freezing winter behind for the sandy beaches of Florida, the market has gained traction.
Home prices in Sanibel are up nearly 50% year over year, with a median home price of $1.1 million, Redfin reports.
Homes sell, on average, about 12 days after listing. Last year, the average time spent in the market was 56 days. Inventories have also fallen over the past year.
That’s, as mortgage rates rose again this week. The Mortgage Bankers Association reported that the 30-year average interest rate rose 17 basis points to 5.53% in the week of May 6.
This is the highest rate for the most popular mortgage in the country since 2009. The refinancing index is down 2 percent. Mortgages are rising at the fastest pace we haven’t seen in decades.
Still – Sanibel is hot. Fifty percent of the homes there were sold above their listing price.
For Lisa and Keith, finding a home with a boat dock, privacy, and multiple bedrooms was important. The couple visited three homes, the price of which all exceeded two million dollars.
Hossam Nagy, president and CEO of Marcus & Millichap, says Sanibel Island has an amazing allure.
“Supply levels are practically flat, which helps insulate Sanibel from some of the effects of economic challenges more than other markets in Florida.”
“Easily accessible from Fort Myers via a bridge, Sanibel Island features a combination of attractive waterfronts and limited space, both of which are a beneficial factor for home values,” he said.
“As an island that also shares some of its footprint with a National Wildlife Refuge, there are severe restrictions on the land,” he added.
“As such, supply levels are practically flat, which helps insulate Sanibel from some of the effects of economic challenges more than other markets in Florida.”
The Gee Family real estate team in Sanibel is also seeing a growing interest in Sanibel.
When asked if the Sanibel Island market has returned to normal with higher interest rates, they shared the following data on their website: “If the total number of listed homes in the area moves to 60, that’s a market shift. If it moves to 90, that’s It indicates that Sanibel is heading towards a normal market.”
For southwest Florida in general, supply is still scarce.
Some buyers accept a “placeholder” purchase, just to get their feet on the ground in the area.
This is especially true for homebuyers looking for beachfront property.
The property market in general is probably moderate, says Marcus & Millichap’s Nadji.
“The era of explosive price growth witnessed last year will likely give way to a period in which values are largely driven by the pace of increases in mortgage rates,” he said.
On ‘American Dream House’, my husband searched for a home that was revealed in Oklahoma
“Additional price increases of 50 to 100 basis points could lead to a modest price correction. Higher rates will dampen the ability of some buyers to compete on price, while higher inflation increases the costs of everyday goods, leaving less money for consumers to use for a lower premium .”
However, this does not mean that Florida will collapse radically.
“There are several tailwinds driving housing demand in Florida that should give the market a lot of support. The warm climate, lower tax burdens and new job opportunities provided by a wave of recent corporate relocations continue to attract more residents to the state.”
The movie “American Dream Home” airs Wednesday nights at 9 pm on Fox Business Network.
To learn more, watch the video at the top of this article, or Click here to access it.