Wall Street Journal notes unironically the number of householders “under water”.
“Cape Coral is the worst housing market in America right now,” said José Echevarria, a Realtor. “I don’t think we’re at the bottom yet.”
Home prices for Cape Coral-Fort Myers have tumbled 11% in the two years through May, the most of any major metro area, according to an analysis for The Wall Street Journal by the listing site Homes.com.
The area’s home prices have declined for 12 out of the past 13 months, and 52% of the homes have experienced price cuts, according to Parcl Labs, a real-estate data-analytics company. While that is more than nearly anywhere else in the U.S., neighboring communities such as Sarasota and Tampa are in a similar bind.
Cape Coral also has the most homeowners underwater in the country, with nearly 8% owing more on their mortgages than their homes are worth.
Echevarria recently hosted an open house in Cape Coral. The home, bought three years ago by an investor looking to rent it on Airbnb, is fully furnished and has a pool. The asking price started at $675,000, but the seller has cut it to less than $500,000, about $100,000 below the purchase price. It has been on and off the market for a year and has received zero offers.
“We’re cutting the price further tomorrow,” Echevarria said last week.
Housing markets throughout the U.S. are grappling with one or more of the factors that can hurt home sales and prices, including high mortgage rates. But Cape Coral is suffering from nearly every affliction that can cause a housing market to slump.
The metro area of about 800,000 is feeling the effects of elevated home prices, ballooning insurance premiums and property taxes, natural disasters, a return to the office for remote workers, and waning demand from investors after a glut of building in the area brought rental prices down.
At the height of the recent Florida migration frenzy, Lee County, where Cape Coral is located, had 3,500 homes available for sale. Now there are 12,000 listed.
“With so much supply, very little demand and a seller base where over 50% are cutting prices, I would expect this downward trend to continue,” said Jason Lewris, Parcl Labs’ co-founder.
===
Below, Fed Chair Jerome Powell on rising cost of home insurance due to climate risks.