Realtors caution against selling homes due to Cape Coral UEP assessment

Reporter: Samantha Johns Writer: Matthew Seaver
Published: Updated:

Sticker shock from the price tag of a mandatory utility project in Cape Coral has some thinking it’s time to pack their bags and leave as soon as possible.

On Wednesday, Cape Coral held an open house to answer people’s questions. Their most significant issue is the nearly $40,000 bill for hooking up to city water and sewer.

District three council member Tom Hayden says only 4% of people in the Cape can afford to pre-pay their portion of the project. There are options to spread out the payments over 20, 25, or 30 years, but that comes with interest—nearly $100,000 worth in some cases.

Some people wonder if it’s even worth it and weigh the option of staying in the Cape or leaving it in their rearview mirrors.

If you drive around northeast Cape Coral, for sale signs near new construction are all around. For months, buyers were snapping up these homes and many others.

Will those buyers think twice now that they know how much the Utilities Extension Project will cost?

“You’re looking at about another $300 a month if you’re financing those assessments. So if your debt-to-income ratio, as a borrower, is already tight, that $300 extra month could push you over the top,” said Peter Davis, a John R. Wood Properties broker.

Property owners in northeastern Cape Coral just got their UEP assessments. They average $33,000. Many homeowners might not be able to swing that kind of cost and decide to move.

They might not get the return on the investment they hoped for either.

“Is it paid for it? And if it is, then yes, you will likely get a profit off your property. If it’s not paid, more than likely, it’s going to be a little bit lower price. And you might just break even on what you bought the property for,” said John Fricano, a realtor with Cape Coral Lots.

So how does a seller factor the UEP assessment into their listing price?

“If you’re going to list a new construction home, in that area, for say $400,000, you know, you may come in more at, you know, $385,000-390,000 and negotiate probably down more than likely, especially in this market,” said Davis.

To get the most profit and avoid the higher interest rates, Fricano recommends people don’t rush to sell. “I would say stay where you are for right now.”

In talking with people who are in the know, every time a UEP assessment comes out, people say they’re going to leave. Some do, but many others find a way to stay.

Northeast Cape Coral is a growing neighborhood full of new construction. The possibilities are endless for potential buyers, but Davis said the cost of the house is not the only cost would be buyers must factor into any offer. They must also consider the city’s assessment for the Utilities Extension Project.

“You will be responsible for that cost. That’s going to be passed along to you,” said Davis.

Property owners got those assessments this week. Construction on the project is set to begin in April.

“It’s a pretty disruptive situation because of all the work that they’re doing. I mean, they’re tearing up the streets, sidewalks, curb, gutter, and all of that,” Davis said.

Fricano has more than 20 lot listings. He said while buyers may pay more than they want to, they will also reap the benefits because when the project is done, Fricano expects property values to soar.

“We’re changing drastically, the city’s building, and I think that we’re going to be booming. So jobs and everything else will be a great opportunity for anybody who wants to live here,” said Fricano.

Do the benefits of moving in outweigh the cons? According to Davis, they do. “It’s kind of like Benjamin Franklin said, you know, the only thing certain is death and taxes. Well, you can add assessments on to that, too. But I think it’s a great place to be. And I think a lot of people recognize that.”

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