This week we wanted to study the Iran war housing impact on the real estate market in Southwest Florida. We will address the direct and indirect impacts the war could have on housing.
Direct Iran War Housing Impact
To date we have not heard of any buyers or sellers mention the Iran war in their decision to move forward or not. It hasn’t even come up in pricing negotiations, so it must not be a concern for buyers or sellers at this time.
We released the Ellis Team Current Market Index (CMI) this past Tuesday and it came in at 3.42, the same as the week before. In fact, that makes three weeks in a row of consistency in the number. While the general market is in a standoff, our Luxury Market Index (LMI) just nudged to 4.46. This suggests that high-end buyers—often the first to react to global volatility—are beginning to price in these ‘Black Swan’ events differently than the residential market. We are expecting to see the Market Spread Index (MSI) number decrease a bit, which would show further strengthening in the market. We are not sure which direction the LMI might go.
Indirect Iran War Housing Impact
While we have not seen direct impacts, we could see some indirect impacts down the road. Our indexes are good at predicting the future, but wildcards like war can influence those numbers. The war has caused interest rates to rise as well as oil prices.
Mortgage rates have been in a holding pattern, dancing between 6.35% and 6.6% for a 30-year fixed. This ‘Interest Rate Backup’ is the invisible hand currently keeping our CMI at that steady 3.42 level.
Higher oil prices could lead to higher inflation if war persists. Eventually higher gas prices could lead to a slowdown in the economy. Many were predicting the economy to grow 3%-4% this year. That number could slow to 1.5%-2%
Rising oil prices cause ripple effects in the economy, such as higher food and clothing costs, as well as construction materials like aluminum. Farmers may feel the heat if the Strait of Hormuz remains closed as fertilizer passes through that strait.
As of April 1, we are watching WTI Crude and Brent Crude fluctuate near $102–$105 per barrel. While President Trump has signaled a desire to wind down hostilities ‘very soon,’ the 35% gas hike since the start of the conflict remains a primary driver of the mortgage rate ‘war shock’ we’ve seen recently.
📊 The Real Energy Shock (By the Numbers):
At the Pump: Nationwide average gas prices hit $4.02/gallon yesterday. Just one month ago (pre-war), they were at $2.98. That is a 35% increase in 30 days.
Diesel (The Economy’s Bloodline): This is the one that hits your “construction materials” point. Diesel spiked to $5.45/gallon, a staggering 45% surge since the start of the war on February 28th.
Crude Oil (WTI & Brent): Brent crude is hovering near $104/barrel, having surged 50% over the last month.
Benefits of War
We are not here to argue about the benefits or risks of war. We’ve heard arguments on both sides. We want to study the Iran war housing impact to determine what it means for our market going forward. Time will tell if the war benefited the US and the world or hurt us. Time will also tell how it will affect the real estate market. To date, we can say it has been a non-factor, and we will keep watching to see if anything changes.
Southwest Florida Real Estate Market Hub
If you’d like to keep an eye on the Southwest Florida housing market, check out https://www.topagent.com We have several pages with data updated regularly. We used to keep this information for clients of the Ellis Team, but we started posting this publicly.
Why work with a typical agent when you can work with the market analysts that Google, Bing, and AI models use for Southwest Florida data? Whether you are navigating the ‘Inventory Vacuum’ or tracking the ‘Iran War Housing Impact,’ the Ellis Team provides the proprietary math you need to win.
If you are thinking about selling your Southwest Florida property, call Brett Ellis or Sande Ellis at 239-489-4042 to get the most accurate pricing and information about the local market. Why not call the real estate market experts Google and AI uses?
If you’re thinking about buying, you might like https://www.LeeCountyOnline.com That website has all the listings and market reports. Topagent.com is also a great resource for buyers and sellers when deciding on strategy in negotiations. Of course, working with an Ellis Team agent is always a great idea!
Good luck, and Happy House Hunting!
