Just an hour apart on Florida’s Gulf Coast, Cape Coral was branded as "America’s worst housing market" — a place where nearly 8% of homeowners owe more than their property is worth.
But in nearby Naples, brokers are selling up to $70 million condos and developers are rolling out $35 million beachfront villas, drawing billionaires from New York to California. Local real estate leaders say the split reveals not collapse, but a market "rebalancing," and proof that Naples has cemented its place on the world’s luxury stage.
"If it was a single word, I would say rebalancing," Premier Sotheby's International Realty CEO Budge Huskey told Fox News Digital. "The last four months, we’ve seen pending sales increase far beyond where they were last year."
"Though [the market] ebbs and flows throughout the year, we are very confident that we’re gonna have an amazing season this year, not only in Naples, but across our platform," Kolter Urban Senior Vice President Ed Jahn said to Fox News Digital.
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At the end of June, The Wall Street Journal named Cape Coral as the worst housing market in America. They reported that 8% of homeowners were underwater – more than anywhere else in the country – and that home prices have declined for 12 of the past 13 months.
This posed a stark contrast to what the area witnessed during the early years of the pandemic, when the median home price increased almost 75% to $419,000.
"We all saw that article, and we were scratching our heads a bit, and we thought it was a little bit sensationalized," Huskey, who lives in Naples, said. "It was certainly very incomplete as far as the total picture is concerned."
"From Naples, Cape Coral, Fort Myers… what you found is that housing values increased by approximately 75%... so what happened is, when there was so much demand pulled forward and then the combination of hurricanes and just the natural relapse as far as buyer demand, what happened was that pullback caused a reduction in overall prices in the market," Huskey further explained.
"A lot of times in different markets… they can fluctuate up and down with the changes in the market. And you can experience things like that where people can get upside down because home values will fluctuate a little more. In the Naples area, you're not seeing that up and down fluid fluctuation in the pricing," Jahn added.
Naples currently has a median home price nearly double of the $343,431 median price of Cape Coral, according to Zillow data. For a waterfront property in Naples, Huskey says buyers will pay anywhere from $5 million to $10 million.
Kolter Urban is also betting big on the Naples market, with its Olana Residences currently under construction. The exclusive 12-unit boutique high-rise has space for a private chef, butler, sommelier, even a dog walker, and expects to bring in multiple eight-figure sales.
"The fact is that the distance between them is within an hour, but they are radically different in terms of buyer profile and audience in general," Huskey said. "They are comparable in terms of the general lifestyle offered, they just appeal to a different audience and, quite frankly, different price points and overall levels of wealth."
"The biggest thing our buyers are wanting [is] convenience… They really like the lock-and-leave lifestyle that condo living offers… particularly at Olana, this is kind of a niche market because it’s only 12 residences," Jahn noted. "The Naples market, in the past, the season was short. What we're seeing now are many of the buyers are not just a secondary residential owner. They're becoming primary, both for tax reasons, [and] they're coming to their property in the off season."
"There’s a reason why Naples consistently ranks among the top destinations… It still feels a little bit like a small town and yet it has everything that anyone would want," Huskey continued. "It is a rather laid-back pace here. It’s very understated wealth. It is not flash… We're even pulling more people now from destinations like Texas and California."
Across Florida, risks still exist as potential hurricanes and insurance costs loom. Last year, homeowners in South Florida saw an extra $500 per month in insurance costs, according to the National Association of Realtors.
But Huskey and Jahn remain confident in the market’s ability to adapt.
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"It all boils back to convenience… buyers today are much more educated… you need to be ready for all the answers," Jahn said. "A lot of people are concerned about the economy, but we watch that very closely."
"New product is being built, considerably raised, hardened… but with that transformation comes additional expense," Huskey also said. "[Communities] are going to be drawing that high wealth individual… So we're incredibly optimistic about the long-term attraction of our markets all across southwest Florida."
