CAPE CORAL, Fla. — If you’re in the market for a home right now, you may have noticed a trend.
Options of homes to buy have been few and far between and constructing a home has been just as difficult.
"Probably two months after Covid had hit, it has just exploded.”
It doesn’t take much to realize the housing market in Cape Coral is booming. Plots of land, houses being constructed, homes for sale- demand is high.
"Homes that were, let’s say, 350 a year ago- well there’s a lot of people interested in that price range," says Frank Ehrhardt, Broker Associate at John R. Wood Properties. "In that price range there’s almost nothing available. We’re seeing multiple offers pretty consistently almost across all price ranges.”
In fact, Ehrhardt says demand right now is causing plenty of competition when it comes to buying a home.
"If you look at the past year in Cape Coral alone, the average home went from a price of $352,000 to $465,000," he says. "In 12 months, that’s a 32% increase which is just phenomenal.”
And if you’re not in a bidding war for a home, having one built is just as difficult. Resources have been few and far between. Labor shortages, supply chain issues… it all stems from the Covid-19 pandemic. And it’s requiring time and patience of potential home owners.
Ehrhardt says most builders are quoting 18 to 24 months right now to build new homes from start to finish. Before Covid, that number was nearly halved taking 10 to 12 months.
"The builders don’t know what’s going to be a problem yet, but they know they’re probably going to run into something between the time the contract is signed and the time they finish the house," said Ehrhardt. "They’re trying to be conservative with their estimates so if they tell you 24 months and they finish it in 22, most people aren’t going to be too unhappy with you.”
“It seems that as we alleviate one point of pressure, another pops up," says Dr. Shelton Weeks, Lucas Professor of Real Estate/Director of the Lucas Institute for Real Estate Development & Finance at FGCU.
Dr. Weeks says without the catch-up from new home construction, we’re likely to continue seeing an upward trend in home prices.
"If we’re going to continue on this growth path that we’re currently enjoying, we’ve got to figure out how to bring more housing to the market.”
And with more people viewing SWFL as a place to raise a family rather than a vacation getaway, demand is only going to go up. The issue of bringing more affordable housing to the market- as Dr. Weeks says- must be solved.
"While it’s hard to say exactly what home prices are going to do, I think this is something we’re going to have to keep an eye on if we want to be able to sustain the level of growth that we’re working towards in our local economy.”