As typical with most summertime seasons, the real estate market in Englewood, Port Charlotte, North Port and surrounding areas have slowed down.  The “high season” in Southwest Florida is in the winter, usually from November to March.  This is the time when our population is greatest.  Our seasonal residents make the most out of the terrific winters here during those months.  The summer months or “low season” is usually slower with less going on with regard to real estate and general economic activity.

Even though a slow real estate market is expected in the summer season, this summer’s market has been much slower than normal.  Partially this is because of the previous four years worth of spectacular activity, which has spoiled many of us in the real estate market.  Now that we are back to a “normal market,” we feel as if the market has shut down. 

The reason for the real estate slowdown in Southwest Florida is five-fold. 

1.  Interest rate increases.  Many investors used lines of credit and other forms of cheap financing to dabble in the real estate investing arena.  The raise in short term rates have effectively shut these people down.

2.  The Media.  The media can make or break a market.  Sensationalism sells and whether its good or bad newspapers, magazines, and television will want to cash in.  The big story over the last few years has been striking it rich with real estate, now the story is the “bubble bursting.”  Similar to the way the media hyped the internet stock market boom and subsequent crash, so the same are they hyping the real estate market. 

3.  The Middle East.  This is somewhat of a chain reaction.  The unrest in the Middle East causes increased oil prices.  Increased oil prices cause increased gas prices.  Increased gas prices affect the whole economy causing inflation.  The Government tries to counter inflation by raising interest rates taking us back to reason #1 in our article.

4.  Hurricanes.  To a small degree, Hurricane Katrina and others have scared some people away from Florida.  Informed people realize that today’s homes in Florida can withstand 135mph plus winds and with proper preparation, the effects of hurricanes can be minimized. 

5.  Real Estate values in other areas.  When values drop in other areas, the market in Florida to a lesser degree can also feel the trickle down effects.  For instance, if a retiree in New York is to sell their home and relocate to Florida, if that retiree cannot make good money off the sale of their New York home they will not be able to use that money for the purchase of the Florida home.


There are some real slow downs in this market that are exceptional.  The first being vacant lots.  Standard sized 80x125 vacant lots were available for 10,000 to 15,000 each as early back as 2003-2004.  The prices of the lots escalated with the real estate boom to almost 60,000.  Since the height of the boom, which most will agree was the summer to fall of 2005, lot prices have dropped to a staggeringly low price of between 20,000 and 25,000.

The number of lots listed on the Englewood, Port Charlotte, and North Port MLS systems is staggering. Almost 10,000 lots are available for sale here as of the time of this writing.  Because a great deal of these lots are owned by investors looking to cash in on the latest real estate craze, these same owners are now panicking and selling these lots at prices most experts thought would never be reached again.  This extreme selling coupled with low demand due to the season and other factors, have lead to a buying opportunity that many thought would not occur again.

The prices of homes have also declined but not nearly as much as vacant land.  Housing prices are generally is not as volatile as unimproved land.  The best deals for housing in the Southwest Florida area now seems to be with new construction.  Many investors have contracted to build homes and condominiums with local builders and are now facing the pinch of decreased demand.  When these homes were contracted to be built over a year ago, the market seemed to be unstoppable.  Now that demand has slowed, these same builders and investors are willing to “let go” of their investment for a much lower price to avoid their mortgage payments and taxes that they thought they would never have to pay.

Older homes in the area seem to be holding their price, but their activity has come to an abrupt halt. Many people feel like their homes should be priced like they were one year ago when the market was terrific, but as they find out once there home has been sitting on the market for six months, they were wrong.  In order to sell an older home in this market; one must be willing to drop their price to a more realistic level.  Many have chosen to hold their homes and just rent them out until the market rebounds.

As most investors will tell you, when others are selling you should be buying and vice versa.  With that being said, I believe there are some terrific opportunities for true real estate investing in Southwest Florida.  This is not the “flip this house” type of investing, but the type that has built million and billionaires over the past 50 years and that is long term investing.

True investors wait for opportunities such as this and strike while the iron is hot. If you are that type of investor, then please give us a call and we can get started!