Investors leave Southwest Florida
Investors leave Southwest Florida
Big-money home investors leave Southwest Florida according to a report released by RealyTrac. This trend of investors leaving the market is consistent with national trends for both single-family and multifamily homes. Nationwide, investor purchases were at their lowest level since the Irvine, California-based research firm began tracking the metric 15 years ago. Institutional buyers — defined as those who bought at least 10 properties in a calendar year — purchased 2.4 percent of all residential properties in May, compared with 5 percent in May 2014.
Rising home price have made Southwest Florida less attractive to institutional investors, who typically are looking to scoop up bargain-priced properties, and then hold them for a period of years both for rental income and eventual appreciation. In the Naples-Marco Island metro area, institutional investors bought only one property in May, but 20 during May 2014. In Cape Coral-Fort Myers, sales to big investors dropped to 16 from 104 during the same period. Throughout Florida, they bought 572 homes in May, less than a third of the 1,736 they bought a year earlier.
In both metro areas, the percentage of institutional investors was smaller than the state as a whole. Statewide, they bought 3.3 percent of homes in May, compared with 6.9 percent a year earlier. In Naples-Marco Island, only 0.2 percent of all sales were made to institutional investors, compared with 3.2 percent in May 2014. In Cape Coral-Fort Myers, the percentage dropped to 1.7 percent of all sales, compared with 6.9 percent the year before.
Also, there are fewer distressed sales, including bank-owned homes and those in the foreclosure process. Nationally, 10.5 percent of sales were distressed, down from 18.3 percent a year earlier. May’s number is the lowest monthly level since RealtyTrac began tracking it in January 2011. Statewide, the percentage of distressed sales fell to 16.3 percent from 30.1 percent over the year. In Naples-Marco Island, the total number of distressed sales dropped to 114 from 248 over the year in May, the report said. As a percentage of total sales, 8.6 percent were distressed in May, compared with 16.8 a year earlier. The total distressed sales count in Cape Coral-Fort Myers dropped to 196 from 522. That represented 13.1 percent of sales, down from 22.3 percent.
Finally, buyers bearing cash also have diminished in the region. In Naples-Marco Island, May cash sales fell to 449, or 36 percent of all sales, down from 490, or 42.4 percent of sales, a year earlier, the report said.
