SW FL Real Estate

The following was reported recently:

The Bonita Springs-Estero Association of Realtors (BEAR) reported a 27 percent surge in sales of residential homes, 58 to 80, from February to March. They also showed an encouraging increase in pending sales, 188 to 214, up 12 percent in the past month. 

The Bonita-Estero median price is double that of the rest of the county and the state.   The Bonita area isn’t going to see those prices drop much lower. Much of Collier County is the same.

I am somewhat glad to say "I told you so".  And the above is proof of what I told you.  We are finding a bottom to this thing.  Now is the best time since 2000 to be a buyer in this market

Local.

The story about politics is - ultimately people vote their own wallet.  With real estate, we always vote our own wallet and that becomes local.  We see the numbers and reports on a national level and everyone knows the horror stories of real estate all over the U.S.  But, it is local.  for example: I know of a community just outside Chicago where homes are listing one day and selling the next and where prices are increasing - not decreasing.  It is just local.  It isn't like that area has a "draw" of any kind.

With SW FL real estate, we have always been ahead of the curve.  For example, this real estate market has been in a depression for 2.5 yrs.  That is a fact.  While the rest of country is catching up with that, we have been there for a long time.  We have lost at least 35% of our value and have record foreclosure numbers.  the point is?  We will recover ahead of the rest of the country.

You will see in future months that activity has increased dramatically in March and April.  You will also see increasing activity in future months because this market is finding the bottom.  We will languish on this bottom throughout most of, if not all of, 08 but we will increase activity because buyers are recognizing the bargain basement pricing.  There are great buys in this market and smart buyers are taking advantage of them.  If you are a buyer, it is time to take advantage of these prices.  If you are a seller, you are very near the bottom.  And, the homes that sell are priced to value.  People are buying the value.

The median sales price has dropped 34 percent from its high of $322,000 in December 2005 to $212,000 in February 2008, the last month statistics are available, (Fl Assn of Realtors). Permits for new houses have slowed to all time lows (74 in March compared to 1,558 two years ago).

Foreclosures have become common in the past year: In 2007, there were a record 10,700 foreclosures in Lee Co., according to statistics released in March 2008. However, 2008 will likely surpass the 2007 record.  This is deeply suppressing the resale market.  40% of recent mls sales are attributed to short sales or foreclosure sales.  These lowest priced properties will continue to flood the market as lenders are forced to put them on the market in future months.

Sales are increasing substantially.  The sales numbers are also up 30% from the same month a year ago. 

Summary: we are finding the bottom. Don’t look for continued drastic price drops.  Also, don’t look for the market to change over the next 6 months.  The market will languish as properties move and more foreclosures are added.  What market segment appears hurt the worst?  Of course, the majority price range homes – from $250k - $1M.

Are acting now.  Why?  The market is seeing:

• Substantially increased activity over prior mos. and 1 yr ago
• Sellers are dropping prices on an individual basis
• We are finding the bottom of this market

Is there still an over supply? Absolutely

Will this market continue to languish on this bottom? Yes, most likely

For how long?  Nobody knows - probably most of '08

So why move now? The buys - the choices - the eager sellers are all ready for the buyer to make their best "deal"

Won't it continue to fall?  Likely not appreciably - take advantage now and have it done - over the next 24 mos. you will be glad.