Last week 359 condos were listed for sale on Marco Island. Forty-two percent of these are two bedroom two bathroom condos. Typical of these popular island condos are the 40 for sale at the four South Seas Towers along the Gulf in the gated South Seas Club. List prices range from $409,000 to $700,000. What accounts for these prices and the 71% price differential between condos in the same buildings?
These list and subsequent selling prices are about twice the price of similarly sized two bedroom two bathroom inland condos on Marco Island. Location, location, location comes to mind. The 860 condos in South Seas Towers overlook the beach on Marco Island’s gulf coast in a gated community with outstanding amenities like the beach, pools, tennis, boat docks, social calendar and security. Over the last five years sales prices for these condos have risen on average 6.4% per year, the same rate as similar inland condos.
Condos at the South Seas Towers have been selling at the rate of 5.5 units per month so far in 2017. On average over the last five years condos have been selling at the rate of 3.2 units per month. Potential buyers are definitely attracted to the condos at South Seas Towers.
Prices for individual condos are determined by many factors. The Collier County Property Appraiser estimates that the Just Market Value (JMV) for an iden tical condo in a given stack in these towers increases about 1% per floor. A condo ten floors
higher is appraised for about 10% more. The unique three-wing design of these towers results in different views from each condo. The two condos closest to the beach on any floor in the wing projecting toward the gulf with unobstructed views of the crescent beach enjoy a JMV 47% more than similar units near the center hub of the building. Because views from these condos are paramount to a buyer, the location on the floor as well as the floor height impacts the price.
All these condos have two bedrooms and two bathrooms and their air-conditioned area varies from 991 square feet to 1,099 square feet, which could account for about 10% in the variation of prices.
Simple upgrades, extensive renovations or comprehensive remodeling is another determinant of price. These towers were built in the early 1980s, so many of the units have been and continue to be modified to varying degrees, increasing their value. Many are sold turnkey or furnished and command more of a premium depending on the style and tastefulness of the furnishings, accessories, flooring and art.
Two of the towers allow a minimum rental period of 30 days, 12 times per year, and two towers allow weekly rentals up to 36 times per year. Many owners offset their annual expenses with rentals. Investors tend to favor weekly rental condos on the beach over monthly minimum rental periods, which add to the demand and differential.
All these factors, along with the motivation of the seller, contribute to list price differences.