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Lee County's Meltdown Turns Golden

May 17, 2009

News-Press

A lot more. Those three words sum up how much a Lee County homebuyer can get now than when the market was at its zenith in 2005.

In almost every price range, larger. Cape Coral instead of Lehigh Acres. Waterfront instead of dry land. Four bedrooms instead of three.

Since December 2005, when the median cost of an existing single-family home hit its all-time high of $322,300, prices have fallen by more than two-thirds. In March 2009, the last month available, the median was $88,500.

And for those at the bottom, the difference is between owning your own home and being doomed to a seeming life sentence of paying rent.

Welcome to the golden age of house hunting.

In the lower range of pricing, the steep reduction in price can recall an almost forgotten era of affordability.

"I just sold a pool home in Waterway Estates (in North Fort Myers), a little bit older house, for $99,900," said Steve Koffman, a real estate broker with Century 21 Sunbelt in the Cape. "I bought an older pool home for $85,000 in 1991.

The same home in 2005, he said, would have gone for more than three times that.

One person who bought recently said he's glad he did, although prices have continued to plummet.

"It's better than renting, period," said Bob Pearce, 48, who bought a three-bedroom, two-bath house in the Cape for $40,500 five months ago.

His mortgage is about $400, which is less than he'd been paying in rent.

He keeps an eye on prices, and knows they've continued to decline but isn't worried about it.

"They've come down a little bit, but now I'm hearing they're possibly going up again because of the investors," Pearce said. "I'm happy because it's going to keep my value up."

Michael Timmerman, a Naples-based senior associate with Fishkind & Associates, an Orlando-based economic consulting firm, said that apparently is the case.

"We're not seeing the pricing dropping like we were," he said. "I think it'll start moving up slowly."

Until then, buyers of moderate means have a rare choice of where they can live, said Brett Ellis of Re/Max Realty Group in Fort Myers.

Four years ago, he said, "for $250,000, if you wanted any kind of new home, you were looking at north Cape Coral or Lehigh Acres."

Now, Ellis said, the same money will get you into south Fort Myers, where "any newer home was about $400,000" in 2005.

In Lehigh, the county's least expensive market, "single-family dwellings and duplexes that were selling for $250,000 are selling for $50,000 to $60,000," said John McWilliams, a real estate broker with Coldwell Banker Preferred Properties.

The community's once-thriving homebuilding industry is hurting as a result.

"It's impossible," McWilliams said. "The materials cost more than the house."

Although higher-priced houses haven't seen the same percentage drop, although there's a lot more to choose from with more houses on the market, said Trae Zipperer, a real estate agent with Re/Max of the Islands who specializes in waterfront homes.

He has an Iona area listing for nearly $1.4 million that would have fetched about $1.8 million during the boom, he said.

Some types of homes are faring better than others, he said, "specifically riverfront, cul-de-sac type properties. The cream of the crop waterfront is in demand all the time."

As the market has softened, many sellers at the extreme high end of the scale are simply declining to lower their prices, said Mike McMurray of McMurray & Nette VIP Realty, who mainly handles homes on Sanibel and Captiva.

With relatively few houses for sale, it can be hard to gauge what a particular house would be worth in the $10 million range, he said.

"There are some unique properties out there that could maybe surprise the market, but they can also take a long time to sell," McMurray said. "Those unique buyers are hard to find when the market's soft."

In Collier County, there's a bright line between the part of town that's seen substantial decreases and the part that hasn't, said Sheila Lewis, broker for Gulf Coast Investment Properties in Naples.

"West of U.S. 41, no one's in crisis here," she said. "I have buyers for it, but they won't budge" on their prices.

A lot of people in the affluent area have no strong reason to sell because they don't need the money and are willing for the market to come back, she said.

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