Overview
This chapter walks through buying a home in Naples, from the first decision to the closing table: the 10-step process I use with buyers, how negotiation works, the purchase agreements used here, and how to think about market timing.
My 10-Step Buying Process
While the process and procedures of buying real estate are relatively straightforward, they are not without potential complications. There are important tasks to complete, and serious consideration should be given to highly consequential decisions that buyers will need to make. Over the many years I have helped buyers purchase homes in the Naples area, I have honed a suggested 10-step buying process, or outline if you will. I hope this proves beneficial to you.
Please note, while there is a logical order to this, there are no hard rules. The order can be changed when appropriate, and some tasks can be done alongside each other, as well as revisited.
Additionally, please know that to many, some of what follows might be considered obvious and/or very rudimentary. Please keep in mind that we all have different life experiences. Some buyers are first-time buyers and know very little about buying real estate.
1. Determine Your Timeline
Once the idea of buying real estate takes hold, deciding specifically when you might like to buy is a very good first step. This can save you quite a bit of time spinning your wheels and can also prevent issues related to financing, should you want or need it. There are also potential investment, retirement, tax and other personal finance implications related to specific dates or general time periods. Once you determine when you want to buy, you can determine when all other steps need to occur to meet your desired timeline to own real estate.
Tip: As suggested in Chapter 8, Costs & Taxes, should you have professionals involved with your personal finances, please use their expertise. Determining your purchase timeline should likely involve them.
2. Understand Your Ability to Buy
A buyer must know if they are able to buy when they want to buy. Even high, very-high and ultra-high-net-worth individuals – those who can buy what they want, when they want, with very little to no financial consequence – must know their ability to fund a purchase when they want to make it. All buyers should know what they can afford to spend on real estate before investing much time examining more specifics of a potential purchase. There are two scenarios here:
Buying With Cash
Having liquidity, with enough cash on hand or at the ready to wire for an escrow deposit and then close on a purchase, gives a buyer the strongest negotiating position. For this reason, it is recommended when possible.
Should a buyer want to make an offer that does not require a financing contingency, please know that “proof of funds” will be required. A buyer must provide ample proof to the seller that they have the funds to buy in cash. Acceptable forms of proof are usually recent monthly statements from bank accounts, investment portfolios or otherwise. Should a buyer of high net worth not want to disclose specifics or provide the documents typically used, a letter from a reputable financial institution might suffice. It is up to the seller whether they are satisfied with the proof of funds provided.
Tip: A “cash” purchase agreement is also referred to as a “no financing contingency” agreement. Cash agreements can be all cash or include financing. What they do not have is a financing contingency that allows the buyer to exit the agreement should they not obtain financing.
Tip: Should a buyer want or need to liquidate assets to buy, the timetable to do so must be understood. Buyers need to know how long it will take to have cash in hand. (They should also know the tax implications of decisions made.)
Required or Desired Financing
Many buyers require financing to purchase. Others will use financing not out of need, but by choice. Whatever the case might be, should you want or need financing, you should start talking to a lender about 90 days before you might make a purchase offer, and not much sooner. Lenders require up-to-date income and debt statements, credit scores, bank account and investment information, and more, and a pre-approval requires up-to-date financial data. Working with lenders can be “challenging.” Many find it an unpleasant experience, and having to do it only once is preferable to most. If you are too early, you might have to send more up-to-date documents.
(Lenders generally need those documents to be no more than four months old when the loan closes.)
Tip: Before you speak with a lender, read Chapter 8, Costs & Taxes: why a pre-approval matters, why your lender needs your community fees, why to choose a lender that lends in Florida, and, if you plan to retire soon, why you might buy first.
Tip: Do not assume you can buy what you think you might want to buy. Liquidity, tax implications, monthly income, debt and more can affect your ability to purchase real estate in a financially sound manner.
3. Identify Your Location Options
Once you have a timeline and know what you can afford to buy, you need to identify all locations of potential interest to you.
When I first engage in direct conversation with a potential Naples homebuyer, I make no assumption that Naples is where they will in fact buy. Clearly, there is serious interest in the Naples area if we are communicating, but I know well that many who consider Naples also consider other areas of Florida, as well as other states.
Identifying all areas of potential interest will allow you to plan any additional research into them. Whether learning about locations overall or examining specific real estate within them on a site like this one, I suggest you think broadly about locations at first. Specifics can come later. If you have not visited areas of interest, you will likely need to do so to begin gauging suitability.
Tip: It is at this stage that real estate websites really come into play. You should have a basic timeline now. You should know what you can afford to buy. You have locations of interest in mind. Now it is time to learn more about those locations and the real estate available within them. You can “window shop” to your heart’s content.
Tip: This site is very Naples-centric, but much of what this guide covers applies to other areas. Its key lessons should be beneficial whether you buy in Naples, the areas surrounding it or elsewhere. This said, as you will learn in the next chapter, Buyer Representation, the specifics of local real estate will eventually need to be understood well.
Tip: While Naples is the most desirable area of Southwest Florida for most, areas surrounding it might be a better choice, or a requirement, for a given buyer.
The homes for sale on this site are in Naples. If Naples is not quite right for you, Marco Island, Bonita Springs and Estero are worth a look.
4. Hire a Real Estate Agent
Ideally, a buyer will find and hire a real estate agent to represent them early in the process of buying. It is never a good idea to wait until the last minute to do so. The earlier, the better.
Why? Since August 2024, MLS rules have required a written agreement between a buyer and an agent before that agent shows the buyer a home.
This said, buyers need to dedicate adequate time to vetting an agent to hire. Furthermore, once hired, the expertise of a local real estate agent should provide demonstrable assistance in very short order. Your agent will assist you in working through the buying process from this point forward. You will learn a lot, and save time and potentially a lot of aggravation.
Tip: Chapter 10, Buyer Representation, provides very important information about hiring a real estate agent. Please read it.
Tip: If you are examining multiple locations, you might need multiple real estate agents. Please be certain you understand the implications of the buyer broker agreement(s) you will need to sign. They could cover areas beyond an agent’s true expertise. If so, this could be to your detriment.
Tip: Should a buyer not be ready to formally engage an agent with a signed buyer broker agreement, they can still begin forming a relationship with one. (I always welcome contact from those who can benefit from my expertise.)
Tip: While I place hiring an agent in the #4 position here, a great buyer’s agent engaged earlier in the process will be of particular benefit to some buyers. As an example, I know several local lenders that provide exceptional service, highly competitive rates, etc. It could serve a buyer well to use one I recommend.
(Federal law bars a real estate agent from accepting a fee or anything of value for referring a buyer to a mortgage lender. I provide referrals only if and when they will benefit the buyers I work with.)
5. Solidify Your Price Range
To solidify your price range means that you have defined a price range you can afford, within which you can buy real estate that meets your interests and needs.
Price range can be a choice, as well as a requirement. What you can afford or want to spend is one thing. How much you need to spend to buy something you would be happy owning is another thing entirely. Solidifying a price range is where questions about general location, community type, home style, features and more begin coming into focus.
Assuming your interest remains on Naples, this is where this site really shines. Its two searches, Naples, Florida Communities & Neighborhoods and Naples, Florida Homes for Sale, will help you determine what needs to be spent to purchase real estate that will satisfy your interests and needs. You can search by community. You can search by home. And the community pages and home pages draw on each other.
Tip: A lot can change during this phase. Some cannot afford to purchase real estate that is “perfect” for them. Sometimes sacrifices must be made. Needs and priorities must be well sorted. Some wants might take a backseat. I always suggest keeping an open mind and maintaining as much flexibility as you reasonably can.
6. Get Specific
At the start of this stage, the fundamentals of buying are in place. You have answers to the broad questions of where to buy, what to buy and when you will likely do so. You also know the price range you can afford and/or want to stay within. Assuming that you are choosing the Naples area, you have determined that there is available real estate here that will meet your interests, needs and price range, and you have decided to make a purchase in the short term. Now it is time to get into specifics.
Please know that “short term” matters because real estate pricing is fluid and inventory is constantly changing. Getting into specifics makes little sense unless and until you are ready to buy in the immediate to very short term.
Getting specific boils down to a handful of real estate considerations. Below, please find thoughts on some of the specific decisions a buyer will need to make.
Location
While a decision to likely purchase in the Naples area has now been made, the specific location that comes closest to meeting your interests and needs must be determined. If you have read this guide from the start, you know it divides Naples into 9 areas. Furthermore, there are locations outside of these, including Marco Island, Bonita Springs and Estero, that might fit a buyer well. You need to decide where specifically you would like to purchase.
Wants & Needs
Buyers usually benefit from clearly defining their wants and needs in a real estate purchase. Wants should be realistic based upon price range. Needs should be given deep evaluation before defining them as such. As an example, a need for a 3-bedroom property might very well be served by a home that has 2 bedrooms plus a den, office and/or flex room. And a need for a home with a specific minimum square footage might be topped by a home with less square footage but a superior floor plan with no wasted space. What are your wants and needs?
Tip: Putting pen to paper, listing all wants and needs, and then prioritizing them, can be highly beneficial to many buyers. Especially when there are many homes for sale, this will help identify the most suitable ones.
Communities
The type of community you choose to live within, as well as its specific location, can have a highly meaningful impact on your life. Understanding community types, and the finer intricacies of specific community offerings, fee structures and more, is essential. What do you want or potentially need out of your community? Low fees? A full social calendar to ease making new friends, keep busy and/or entertain company? A gym? Onsite pickleball courts or a golf course? A new or fully renovated clubhouse to try to ensure there will be no short- to mid-term special assessments? Onsite food and beverage?
Chapter 5, Communities, covers community types in depth.
Building Types
Most buyers have a firm idea of what type of property they would like to buy when they begin exploring the idea of a real estate purchase. Whether a house, condominium, townhouse or attached villa, buyers usually focus on one property type alone. This stated, once an agreeable price range, location, community type and other factors come into play, property type realities are realized. Sometimes a buyer’s dreams can be fulfilled, with one exception: the building type. As an example, while a buyer might want a house, specific beach proximity desires might only be possible within the price ranges of available condominiums. Pets can also shift building type decisions. Why? Pets are not allowed in many condominiums. If you have a pet, you might have to buy a house or attached villa.
Property Design & Features
Mediterranean and Coastal designs are most common in Southwest Florida. Do you have a preference? How about floor plan preferences? Open concept is all the rage, but there are benefits to more defined spaces with walls. How about split bedrooms? Are you concerned about the proximity of bedrooms to each other? Or the primary bedroom alone? Would you like a lanai with ample covered space for a large outdoor dining table? This list can be long.
Price Range (Redux)
It is the exception to work with a buyer who does not end up buying near or at the very top of their initial price range. Practically every buyer I have worked for – the exception being very and ultra-high-net-worth parties – buys at the maximum they can afford. Often, they stretch to buy a home that is slightly out of reach. Does your price range need to change to buy a home that will satisfy your interests and needs? If so, can you really afford it? Will an increase in purchase price be a wise financial move? Buyers often fine-tune price ranges at this stage.
Tip: If you have not yet hired a real estate agent by the beginning of this stage, you really should. While this guide and site go a long way in assisting any potential Naples area homebuyer, nothing takes the place of working with a capable and trustworthy real estate agent. I am only scratching the surface here. There is much more to know. You will benefit from professional guidance.
Tip: Thinking long-term might be the very best course. Should you believe that you might retire into a Naples home, making it your primary or only residence at some point down the line, you should consider buying the right home for that purpose now if possible. Many buyers regret buying real estate not well suited for this. They buy something small that they plan on using sparingly for several years. Then they end up spending much more time here, on a much quicker schedule than they ever anticipated. They end up selling and then buying an upgrade. While this is certainly good for my business, it may not serve your interests very well, financial or otherwise. “One and done” now might be the best choice.
At the end of this stage, you should know specifically what you are looking for that will satisfy your wants, needs and price target as closely as possible. This site’s searches were built for this. The more time you spend searching for properties on this site, evaluating what you find, and making direct inquiries when appropriate, the more informed you will be. An educated buyer usually makes the very best purchase decisions. And I want you to make the very best decisions for you and yours.
7. Identify & See Best Candidates
Once a buyer is ready, willing and able to buy, it is time to put together a list of the best candidates to visit for further evaluation. Direct communication with your chosen real estate agent is key during this phase. You should be working closely together to identify the very best opportunities, meeting your interests, needs and price target as closely as possible. You should discuss homes you have identified and (hopefully) saved on this site or elsewhere. And your real estate agent should also dive deep into what is currently on the market to help identify top candidates for your consideration. You should then agree on a list of properties to see together.
Tip: This site has a feature called For Your Consideration. If we work together and you ask me to, I mark the homes and communities I recommend for you. You will find them lit up as you search the site, and gathered on your own For Your Consideration page.
Tip: Identifying properties to schedule tours for can start well before seeing them. This said, the actual scheduling will not usually occur until 24 hours to about a week beforehand. As homes come on the market and sell every day, waiting to schedule means newly listed top candidates can be added to the list and sold properties removed.
As for seeing and evaluating homes for potential purchase, there are two potential scenarios.
Will Buy Without Direct Visit
Most buyers will not make an offer to purchase real estate without seeing it in person. This is completely understandable. With this said, please know that I have helped many do just that. The peak of buyers buying this way came during Covid-19. There was very little inventory, and buyers wanted or needed to buy as soon as possible. If the right property came on the market, or close enough, they had to buy very fast to have any hope of landing a home at all.
While Covid-19 was the peak of buyers buying sight unseen, out of necessity, it also happens outside a crisis. A common scenario involves a buyer who knows specifically what they want. They have identified a location, community, etc. It is just a matter of the right home becoming available. Should that home come on the market and that buyer not be in Naples, they must decide whether to get to Naples lickety-split or potentially lose the home to another buyer. It might make sense to send your real estate agent to the property to evaluate it directly and do a video tour with you. Then an offer could be made, should the buyer be comfortable doing so.
Tip: If there is one scenario when it is an absolute requirement to work with a fully trustworthy real estate agent who knows what they are doing, and has only your best interests at heart, this is certainly it. If you have that, you are not in Naples, and the right property for you hits the market, you should at least consider this option. That property could be gone in a flash. (Please know some agents will not engage in sight-unseen purchases due to liability concerns. I do engage in them, and I have had no issues. Everyone was very happy with the process and outcome.)
In Naples Now or Trip Here Scheduled
Seeing homes for sale in Naples will most likely require being with a buyer’s agent. Many communities are gated and require a scheduled tour with a real estate agent to enter. And most sellers are not going to open their doors to strangers. Unless it is a “for sale by owner” property, you will need a licensed real estate agent. Should a buyer care to simply peruse open houses on their own, buyer beware! It could cost you substantially. (There is much more on this in the next chapter, Buyer Representation.)
If a potential buyer is in Naples now and would like to see a home, they should understand that many require 24-hour notice for approval. A same-day tour might not be possible, and your agent might not be available in any case. It is always in a buyer’s best interest to plan tours with this in mind. Contact your agent as soon as a home you want to see comes on the market.
Assuming a potential buyer is not in Naples already, they will need to schedule a visit to see homes and potentially buy. As soon as that trip is a possibility, you should let your real estate agent know. Then, when a trip is firmly scheduled, book specific dates and times to see real estate with your agent of choice. It is never too early to schedule time with your agent. I always encourage buyers to do so as soon as they know their arrival date. The worst thing a buyer can do is show up in Naples without having started a relationship with an agent and expect a reputable agent to be available when they want or need them to be. Book early, please.
Please know that I understand that many buyers need to see real estate in person before solidifying their purchase plans. While many buyers locate and purchase real estate during their first outing with their real estate agent, many are months to years away from pulling the trigger. Seeing homes for sale, as well as the communities they are in, is part of evaluating the area overall. And it can be an essential element in honing wants, needs and price target. Should we work together one day, please know I welcome you to see property with me whether you intend to buy immediately or not. If I have the time to spend with you, I am happy to do so. There is never any pressure to buy when working with me. I only want buyers to buy if and when they are comfortable doing so.
8. Make Offer & Solidify Deal
You have found real estate that you want to buy. You are ready to make an offer and potentially solidify a purchase agreement. Now you need to land the home with the right deal terms and a full understanding of your responsibilities and rights. You will rely heavily on your real estate agent for professional guidance, and they had better know what they are doing. Your agent should know how to evaluate the current fair market value of a home. They need to know the purchase agreements, addendums and various other legal documents used here extremely well. Purchase agreements are legally binding. You must know what you are getting yourself into. Please, never sign any document that has not been made very clear to you.
Please note, once a purchase agreement is fully executed, your agent should immediately give you a list of key dates. These might include due dates for the community’s purchase application and escrow deposits, due diligence periods and more.
(Please see Negotiations and Purchase Agreements below for more.)
9. Do Your Due Diligence
You are now under contract. All due diligence efforts that have been negotiated must get underway quickly. The clock is ticking. Should you have certain rights and not use this period to your benefit, it could cost you substantially, whether legally, financially or otherwise. Again, your real estate agent must know what they are doing here and provide the very best guidance to you.
Please know, should a buyer have inspection rights and want to use them, it is up to the buyer to decide whom to hire to conduct the inspections. Reputable agents have longstanding relationships with best-in-class service providers, but the buyer must choose who they want to use. (I take nothing from any inspector I refer.)
Also, please know that in addition to property inspections, your real estate agent will work with your attorney, title company and/or closing agent to ensure there are no open permits, a clean title and otherwise. Real estate transactions are simple on the surface, but there is quite a bit of work going on in the background before and throughout a real estate closing.
10. Close
If you are financing, your lender must get the Closing Disclosure to you at least three business days before closing. It sets out your loan’s terms and what you will pay. Whether you finance or pay cash, your closing agent also prepares a settlement statement listing all the credits and debits for both the buyer and seller, and any balance due to close. Expect its final figures a day or two before closing.
If a cash deal, the buyer will need to wire the funds before closing. If any portion of the purchase is financed, your lender and closing agent will work together to ensure all numbers match and the paperwork you must sign for the loan is ready.
(Important: Wire fraud is widespread. Before you wire anything, confirm the instructions by telephone, as described in Chapter 8, Costs & Taxes.)
At closing, you will also sign a sworn statement that Florida has required of buyers since 2023, confirming that the state’s law on purchases by people and companies tied to certain foreign countries does not bar you from buying the property. Most buyers simply sign it. If you are not a U.S. citizen or permanent resident, raise it with your closing agent early.
Just before closing, the morning of or the late afternoon before, a final walkthrough of the home is typically done. If you are here in Naples, your agent should accompany you. If you are not, many real estate agents are willing to do this alone on behalf of the buyers they work with. (Some will not, due to liability concerns.) The final walkthrough is to ensure the home is as it is expected to be for you to buy it. Items have been removed if unfurnished. Personal property remains if part of the deal. The home is in the condition you found it in. All items that required repair or attention, and were legally agreed to by both parties, have been completed. The home is clean. If all is in order, you should give your “OK to close.”
The real estate closing process differs across areas of Florida, as well as in other states. Closings here can be done in person or remotely. You often do not have to be here to close on a home.
Florida allows remote online notarization, so you can often sign from wherever you are; whether your closing can be fully remote depends on your lender and the title company.
If you do happen to be here, you can attend in person should you choose to, or still sign remotely. Please know that the seller will not be in attendance. They sign separately and usually (not always) with their own closing agent.
The process and procedures of buying real estate can be cumbersome and stress-inducing for many. There are many potential legal, financial and personal complications, complexities and risks associated with buying. A skilled and caring real estate agent should help alleviate much of this, making it as easy and worry-free as it can possibly be. When I work with buyers, I always attempt to make buying an enjoyable experience. While there can always be events out of my control, should we work together one day, my aim is not only to help you locate and purchase the very best available real estate for you, but to keep you happy and unscathed along the way.
Negotiations
I have negotiated business agreements and real estate transactions with a combined value of over $3.5B. I enjoy negotiating and believe it is a strong suit. This said, to provide much thought on this subject here, in a guide available to the public that includes my competitors, would not serve the buyers I work with well. With this said, I do want to provide some thoughts on negotiation basics, as well as one piece of advice. First, the advice.
Buyer Advice
Do not make any assumptions. Whatever you think you know, please put it aside. Facts are what matter most. Assumptions can be OK at the right time, in the right context and when some facts inform them, but it is usually best to focus on facts alone.
Negotiation Basics
Below, please see a handful of important steps involved in negotiating a potential real estate purchase. Please note, this list is incomplete, lacks important specifics, and provides limited and basic advice. This is intentional. (See the opening paragraph.)
Research
The first step is to gather all currently available information. This includes information available to the public, as well as that which only licensed real estate agents can obtain. As to the latter, it is important to know that there is often confidential information, and several important legal documents related to homes for sale, available only within the MLS. Unfortunately, there is also information that should be made available by the seller or seller’s agent but often is not. Some of it is absolutely required and must be sought out by your agent should it not be readily available for review.
Make Contact & Build Rapport
The first contact your agent makes with a seller’s agent starts the negotiation, whether an offer is to be presented or not. It is important that your agent knows what to say, how to say it and when, whether they are simply setting up a tour or presenting an offer. Every contact moment is important. Ideally, your agent will build a positive and professional rapport with the seller’s agent from the get-go and maintain it throughout any potential deal.
Ask Questions
Asking the right questions the right way can go a long way in understanding a purchase opportunity and in deciding how best to secure a desirable home on the most favorable deal terms.
Listen Actively
To listen actively is to not be distracted by your own thoughts while someone else is speaking. It is to let someone speak until they are done speaking before considering a reply. What a seller’s agent says, and how they say it, can be highly informative.
Conduct Analysis
Once armed with all available information, it is time to analyze the situation as a whole. Know what you know, as well as what you do not know, about the property and about the seller’s priorities, motivations and potential willingness to make compromises.
Consider Your Options
Before an initial offer is made, and during any ongoing negotiation, buyers will have options as to what is presented, how it is presented and when. It is important to always understand your options and the potential implications of choices made.
Please know that a real estate agent who is a skilled negotiator and is looking after the best interests of their buyer will provide beneficial negotiation guidance, but it is guidance alone. The buyer always calls the shots. Also, please know that some real estate agents will not provide much direction. Out of fear of liability or otherwise, they will not provide their opinion on matters, nor much guidance at all. They will simply present the facts as best they know and understand them, and ask what you would like to do. When a buyer wants my opinion, I give it. Most often, buyers allow me to fully negotiate on their behalf.
Purchase Agreements
The purchase agreement is the document(s) used to form a legally binding relationship between a buyer and a seller, stipulating the terms both parties agree to in the exchange of real estate.
When you are ready to make an offer, you will need to understand the purchase agreements used here well enough to know the legal commitment you will have, as well as your rights and responsibilities as a buyer should the seller accept your offer. You will also benefit from understanding the seller’s obligations, rights and responsibilities.
The importance of your agent’s understanding of the legal aspects of purchase transactions cannot be overemphasized. Your agent must know the legal documents, processes and procedures used to buy real estate in Naples specifically. While I have yet to have any legal issues with buyers, many legal problems do occur here. There are plenty of lawsuits between brokerages, agents, buyers and sellers alike. Real estate agents can make mistakes, and do. Some lack necessary know-how. Others stray from doing the best job possible for the buyers they work with. Experience counts here, as does your agent’s commitment to doing the right thing for you, always.
For Your Information
Below, please find several details about purchase agreements in Naples that you should know.
- Purchase offers in Naples are made with legally binding purchase agreements. Should a seller sign a purchase agreement, making no changes to the paperwork, all parties will be under contract. There is no separate process to make offers. The actual purchase agreement is used to make the offer and throughout any negotiation.
- Because legally binding documents are used from the start, all aspects of a purchase agreement must be fleshed out before submitting an offer. Take the purchase process seriously from the start: your offer is a legally binding commitment to buy.
- Two families of purchase agreements are used here: the Naples Area Board of REALTORS® (NABOR) forms, which buyers typically use to make offers in Naples, and the Florida Realtors/Florida Bar forms, often called “FAR/BAR.” There are multiple versions of each, along with addendums. Some benefit sellers a bit more than buyers. Some are a bit more “friendly” to the buyer. Most importantly, your real estate agent must know the differences and how to act in your best interests under all of them.
- Buyers choose which purchase agreement to make an offer with. Sellers can either accept its use or not, and some sellers demand the FAR/BAR forms. Some listing agents, especially those from Lee County, sign listing agreements on FAR/BAR paperwork, and their sellers use the FAR/BAR forms that accompany it: the seller’s disclosure, flood disclosures and more.
- Each purchase agreement requires its own accompanying legal documents. Mixing the paperwork of the two families in one deal is never a good idea, but it does occur. If an agent knows what they are doing, this can be OK. But it can be highly problematic, with significant legal consequences unfavorable to a buyer, if both agents in a deal do not clearly understand how the forms work together, or against each other.
- In addition to the purchase agreement, certain addendums might be required and/or highly beneficial to a buyer. There are over a dozen addendums that might be part of a purchase agreement. Your agent must know all available addendums, when and how they should be used, and suggest their use when appropriate.
- Purchase agreements have a section for Other Terms & Conditions. Should it be used to a buyer’s benefit in some fashion, the language used must be legally valid. Your real estate agent should never add language here that has not been written or validated by an attorney.
- Very important details of your transaction might not be fully realized until after you are under contract to buy. It is very important for a buyer to understand what documents or specific information they are legally owed following the full execution of a purchase agreement, if any, and what their options are following receipt and/or review of them.
- Two of those options are set by Florida law. If you are buying a resale condominium, you can cancel within 7 days, not counting weekends and legal holidays, after you sign the contract and receive the association documents you asked for in writing, as long as you have not closed. In a community with a homeowners’ association, the seller must give you a disclosure summary before you sign; if that did not happen, you can cancel within 3 days of receiving it, or before closing, whichever comes first.
- Purchase agreements, as well as other documents related to purchasing Naples real estate, are updated frequently. They were modified following the real estate industry practice changes that took effect in August 2024.
Necessary Offer Details
Before a purchase agreement is presented to a seller, the buyer must make a handful of critically important decisions that will be reflected within the purchase agreement/offer. These typically include, but are not limited to:
- Purchase price
- Escrow
- Financing contingency (with details) or cash
- Closing date
- Inspection / due diligence rights
- Addendums
- Other Terms & Conditions
Market Timing
I am often asked if it is a good time to buy. My answer is simple. If you are ready to buy, you want to buy, and the right home at the right price is available, it is likely a good time to buy.
For most buyers it comes down to one home being the right home. No matter how many homes I help identify as being closest to meeting a buyer’s interests, needs and price target at any given time, there ends up being one that stands out among the rest and is “the one.” My point is that when you find that one, it likely makes sense to try to buy it if you are ready and able to do so.
All said, I understand that many want to know if and when it is a good time to buy from a financial perspective (mainly) and otherwise (sometimes). Everyone wants a deal, and some want to wait until the “right time” to potentially secure one. There are a handful of considerations when examining purchase timing overall. Here they are.
How Is Inventory?
If home inventory is in the range of healthy to high – a minimum of about 6 months of inventory – it is likely a good time to buy. This means that there are hopefully many homes for a buyer to choose between. Furthermore, sellers have more competition, and should they not be getting many tours or otherwise, they might be more apt to negotiate deal terms.
(Months of inventory is how many months the homes now for sale would last at the current pace of sales.)
Peaks & Valleys
Most new listings in the Naples area come on the market just before and early in our winter season.
Start of Season
Many sellers will wait until just before or the beginning of our winter season to list their homes for sale. This helps ensure that their listing will see the most tours and usually the highest offers. This said, with more homes for sale comes more competition for sellers. Buyers have more homes to choose from. It is also important to consider that buyers have more competition from other buyers during this period. Good homes priced right will usually sell relatively fast.
End of Season
Some sellers list in early summer or so, after “season” here has passed. These are often sellers who wanted one final season to enjoy a property before listing it for sale. Or sometimes they are investors whose final tenants of the season have left and who now want to sell. Neither wants to hold a property over the summer, so they list it as soon as they are done using it. (Listing a home for sale as we enter our slowest time of year is something I rarely suggest, but some sellers do it out of a desire or a need to sell.)
Summertime Buying
Is it a good time to buy during the slowest time of year, our summer? Well, it could be. A potentially perfect scenario in my view is for the right home for a buyer to have not sold during the peak months of our winter season, and for the seller to keep it on the market over our slow summer months. Even better if the seller has reduced the price once or twice. Then, making an offer in August or September or so, our very slowest months, might provide a strong negotiating position. This seller did not sell during a peak buying season and has another 4 months or so before the next wave of potential buyers arrives. And they have indicated they are at least somewhat motivated to sell with a price reduction. Meanwhile, carrying costs have been ongoing for them. It is costing them to hold onto the home.
Summertime can be a good time to buy, but it is also important to know that inventory will be lower and the better-to-best homes listed during season have likely sold. What is on the market over the summer here might not be the best real estate available at your price point. You may or may not get the “best deal” on a property, but the best home for your dollar might not be one that is available during our dog days of summer.
How Are Interest Rates?
If you are borrowing, low interest rates clearly help. This said, if they are not as low as they once were, buyers need to be realistic about rate movement. Waiting for rates to fall could also mean waiting for purchase prices to rise. If current interest rates allow you to buy a home you would be happy buying, serious consideration should be given to doing so, whatever they may be.
How Is Current Pricing?
I have worked with many buyers who have unfortunately been priced out of Southwest Florida. They could have purchased a desirable home in the years before Covid-19, but they chose not to. They wanted to wait for prices to fall. Instead, prices rose, and they can no longer afford the type of home they wanted to buy in Naples. During Covid-19, I had a few buyers cancel purchase contracts. They lost money doing so. A couple of them told me that they planned on coming back to buy when the real estate market crashed. Quite the opposite happened. They can no longer buy the types of homes they were under contract to buy.
Prices do fall at times. Maybe a little. Maybe a lot. There will be market indicators of what might transpire if this happens or that other thing occurs. There are too many ifs and buts and unknowns. The most important thing to know is that real estate, over time, has long been a very strong investment vehicle. Over time, prices generally go up. Waiting for them to come down might not serve a buyer well at all.
Is It a Buyer’s Market?
Sellers’ and buyers’ markets are usually defined by inventory alone. When I analyze local market activity, I look deeper. I examine inventory, pricing trends, annual fee movement, active-to-pending timeframes, interest rates and more. These all provide means to conduct quantitative analysis of our local real estate market. Equally important, I examine the qualitative information only a local real estate expert can obtain by being out in the field representing buyers and sellers, and by keeping an ear to the ground, hearing from other professionals about what they are experiencing day to day.
I have worked for people who have had very good fortune in purchasing and selling real estate. They have always bought low and sold high. Their timing has been impeccable. I have also worked with people who have not only not made any money from real estate but have lost quite a bit. If the short- to mid-term investment potential of a home is particularly important to you – you have a set plan for when to sell, it is in the short to mid term, and you expect to profit at that time – it is important to let your real estate agent know this. If you work with me, I take it into account in the advice I give you.
Timing the market is not easy. The fact is that an individual’s purchase timetable usually aligns with their life timetable, not the market. Most often, purchase timing is related to family planning, personal finances, age, retirement plans and other key life landmarks. The real estate market might be well out of alignment with these events. So, my best advice is to buy when you are ready and able to buy. Do not wait, expecting to “buy better” later, unless you have a crystal ball.
