Tale of Two Properties in Naples Florida
For those that do not know Naples, Florida it is a resort community located in Southwest Florida bordering the Gulf of Mexico. The weather and beaches are a big attraction but a lot of high end homes exist in country club communities as you head east of the coast.
Recently two different properties located in my hometown of Naples Florida, sold that are hard to make sense of the transactions.. Both of those sales were vacant home sites.
The first property is a 6750 square foot home site (approximately 1/8 acre) in an older neighborhood. This ungated community consists of smaller older homes occupied by working families and retirees. Be assured that while this location is desirable this is not a fancy neighborhood and some of the blocks have homes that are now ready for demolition. The run up in home prices that occurred until 2006 drove some homes in the 6750 square foot home site location to above $500,000. But as prices have fallen, average prices are now in the 250,000 to $350,000 range.
The second property is a 49,222 square foot home site (approximately 1.12 acres… 9 times larger than the first property) in a gated community some might say (certainly the developer) is one of the finest country club location in Naples. There are no working class heros receiving their mail there. 10,000 square foot homes are by no means the largest and several homes in this country club sold above $7,000,000.
The point of this comparison is that in November 2009, both these lots closed for $86,400 and $75,000 respectively. What this says about real estate is more perplexing than instructive. The only conclusion I can offer is what we already know… real estate values are as much out of whack on the downside as they were on the upside. As bad as the automotive sector is, you still can’t buy a Rolls Royce for the same price as a Kia.