Tuesday night’s sold out Market Watch 2016 event was held at the Harborside Event Center with over 1,100 attendees and featured presentations from real estate experts Randy Thibaut, Denny Grimes, and Stan Stouder.
Mr. Thibaut announced a 44% increase over the last year in building permits for Lee, Collier, and Charlotte Counties. Importantly, he reminded attendees that a large portion of the permits were apartment and assisted living units, which have been “white hot” in Southwest Florida lately. In fact, the Lee County apartment market is one of the best in the nation and has increased eight fold from 2014 to 2016, according to Mr. Stouder’s statistics.
Increase in Multi-Family Housing
The rise in the popularity of multi-family housing units may be due to the steady increase in the pricing of single family homes. The buyer drives the market, as Mr. Grimes noted, and affordability is particularly important for real estate buyers here in Lee County, where 80% of the permits issued last year were for homes priced under $200,000. An interesting fact pointed out by Mr. Grimes is that a number of purchasers of residential units in Collier County include Broward County residents, who find it just as quick to commute across Alligator Alley as it is to travel south on I-95.
While all three presentations highlighted the healthy state of the current real estate market in Southwest Florida, an effort was clearly made to address what was referred to as the “elephant in the room.” The experts suggested that a continuous 44% increase in the issuance of permits is not sustainable and savvy real estate investors have started “tapping the brakes” on development to avoid another dilemma like we experienced in 2008. While this “tapping the brakes” may not be what everyone wants to hear, the three presenters were unanimous in their opinions that it may be prudent and that it will only be temporary. Ultimately, according to the experts, the market will in short order correct itself and this will result in a more reasonable and sustainable growth pattern.