Olde Naples is an intriguing architectural and social paradox. It is, after all, the guardian of the city’s historical roots and cultural legacies, and yet, it is the site of some of the area’s most innovative and contemporary lifestyle trends. There is no other local community so diverse in architecture, varied in lifestyles and charming in its eclecticism. Hidden gravel alleyways branch off prestigious promenades such as Gulf Shore Blvd, beachfront bungalows perch on the water’s edge and sprawling estates wrap around duck-loving lakes. For residents, this heterogeneity ensures an aesthetically pleasing ménage of personalities, a link to the past and a hint at the future; for realtors, developers and investors, it opens up a world of possibilities.
Over the last year, despite turmoil and tempests, the Olde Naples single-family home market has remained fairly steady and consistent; across all vintages and price points the number of listings and sales is almost identical to that of 2016. Prices are robust and impressive, the highest sales price was $11.5m, and average sold price per sqft was $949.77 (once adjusted to exclude sales of teardowns which distort figures due to their low living area to lot size ratio). Of the 73 sales, 17 were new construction, 56 were resale and 7 original cottages were purchased at a premium for historic significance. At the moment, there are 26 new construction homes on the market and 46 resale listings - including 18 teardowns and one lone cottage for the nostalgic. All in all, this suggests a fairly balanced market, however we will have to see if this continues throughout the upcoming season and its inevitable injection of inventory.
Quantity is just one half of a very important equation. Quality, that significant yet subjective feature, will play an important role in future market performance. A quick survey of the existing inventory of teardowns suggests that location-wise, these homesites are arguably in much less desirable areas than in previous years, forcing developers to pay premium prices for subprime lots. As predicted, both sales of homesites for redevelopment and new construction in areas contiguous to Olde Naples, such as Ridge Lake, have been sluggish. These constraints and parameters have inspired architects to be creative and experiment with new residential constructs; in the past two years, developers have parcelled up existing lots into much smaller spaces and proposed the “new construction cottage” as a solution to these challenges.
New construction cottages, defined as properties of less than 3,500 sqft and situated on compact lots of 0.25 acres and below, neatly squeeze into the gap between teardowns and recently completed 4,000 sqft + single family homes. At first glance they are eye-wateringly expensive in terms of price per square foot, with sales averaging $1019.18 over the last two years; yet they create an attractive opportunity for buyers in the $3.5m price point who desire a prime address in central Olde Naples, the freshness of new construction, and the low-maintenance lifestyle of a smaller house and lot. They are a unique, if not too specific, solution to a growing problem and the market has responded well. Buoyed by this success, developers seem optimistic about the fate of the 7 new construction cottages listed and have used the strong past sales to anchor even higher prices for these and others currently under construction with an average listing price per sqft of $1,313.28. It is a formula, if executed correctly, that seems to engender success, but are these new projects catering to a market already saturated? On the cusp of season, we can only speculate on what the next quarter of activity will bring, but one thing we can say for certain is that the Olde Naples market will continue to adapt, experiment and evolve as the community searches for an elegant balance - preserving the delicacies of heritage, razing the ranch-style blunders of the mid-century and promoting optimistic innovations of the future.