Florida’s existing home, condo sales rise in February 2009

Florida’s existing home sales rose in February, making it the sixth consecutive month that sales activity showed increases in the year-to-year comparison, according to the latest housing data released by the Florida Association of Realtors® (FAR). February’s statewide sales also increased over January’s figures in both the existing home and existing condo markets.Existing home sales rose 20 percent last month with a total of 9,858 homes sold statewide compared to 8,181 homes sold in February 2008, according to FAR. February’s statewide existing home sales were 16.7 percent higher than January’s statewide sales.

Florida Realtors also reported a 15 percent gain in statewide sales of existing condominiums in February, continuing a trend in recent months for higher statewide sales of both the existing home and existing condo markets compared to year-ago levels. Statewide existing condo sales last month increased 25.1 percent over the total units sold in January.

Thirteen of Florida’s metropolitan statistical areas (MSAs) reported increased existing-home sales in February while 11 MSAs also showed gains in condo sales. It marks the eighth month in a row that a number of markets have reported increased sales.Florida’s median sales price for existing homes last month was $141,900; a year ago, it was $199,300 for a 29 percent decrease. Industry analysts with the National Association of Realtors® (NAR) report a significant downward distortion in the current median price due to many discounted sales, including a large number of foreclosures. The median is the midpoint; half the homes sold for more, half for less. The national median sales price for existing single-family homes in January 2009 was $169,900, down 13.8 percent from a year earlier, according to NAR. In California, the statewide median resales price was $254,350 in January; in Massachusetts, it was $321,000; in Maryland, it was $244,820; and in New York, it was $205,000.

Significant variations in local markets continue, according to NAR’s latest housing outlook, which also notes that it will take time for the impact of the economic stimulus to show in housing data. “Some markets appear to have reached the tipping point of accelerating home buying,” said NAR Chief Economist Lawrence Yun. “Improvement from the economic stimulus isn’t likely to show as closed home sales before summer, although we may see an earlier lift from lower mortgage interest rates.”NAR analysts estimate the impact of the federal economic stimulus package and lower interest rates on the housing market to be about 900,000 additional home sales in 2009 compared to conditions before the stimulus package. By the end of the year, NAR expects inventory to fall below an eight-month supply, which would be consistent with home price stabilization.In Florida’s year-to-year comparison for condos, 3,198 units sold statewide compared to 2,785 sold in February 2008 for a 15 percent increase. The statewide existing condo median sales price last month was $109,300; in February 2008 it was $173,900 for a 37 percent decrease. In the latest data available at press time, NAR reported the national median existing condo price was $174,400 in January 2009.

Interest rates for a 30-year fixed-rate mortgage averaged 5.13 percent last month, down significantly from the average rate of 5.92 percent in February 2008, according to Freddie Mac. FAR’s sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written. Among the state’s medium-size markets, the Fort Pierce-Port St. Lucie MSA reported a total of 372 homes sold in February compared to 263 homes a year ago for a 41 percent increase. The existing home median sales price was $122,100; a year ago, it was $172,900 for a 29 percent decrease. In the year-to-year comparison for the existing condo market, a total of 71 units sold in the MSA last month, up 22 percent compared to 58 condos sold the previous February. The market’s existing condo median price was $116,700; a year ago, it was $126,700 for an 8 percent decrease.

Painful Realities Unveiled Of Buying Bank-Owned Properties

Bank-owned properties can be great opportunities to buy a home at a fraction of the original or desired asking price----sometimes as high as 50% less than what is owed on the mortgage, and often as high as 30% less than the appraised value.

Bank owned properties and the journey one may take to arrive at the closing date is not for the impatient or light-hearted. The Buyer must know, expect, and be prepared for delays, complications and miscommunication.

We've read horror stories of these banks delaying the closing date by months---notifying this new delay on the scheduled closing day! We've heard about Buyers that have moved into their newly purchased bank-owned homes, and coming home from work one day to find a notice taped to the window and the locks changed---all due to misscommunication between the bank and the home's county or city courthouse.

Banks are often nowhere near the homes they have taken over, and they don't or fail to understand the life-rearranging that many couples and families undertake to purchase these homes. Often the necessary steps to an efficient sale and movement of these distressed properties becomes diluted and postponed.

The nation needs to overcome the foreclosure crisis in order to rebuild, but with an overwhelming workload on the part of the banks and lenders---often doubled or tripled---paperwork gets 'misplaced', work is duplicated, and deadlines and closing dates are extended.

Bank-owned has it's advantages, but you have to consider that time is money. How much time will it take to 'hopefully' close on this bank-owned property, and how much money too?

Buying through a Realtor, who has a Seller of a non-distressed property may prove itself in the long run---to be the short run.

Florida Seeking To Advance New Buyers $8000 Tax Credit

Florida and New York are seeking legislation that will advance the $8000 New Home Buyer Tax Credit to first-time buyers---so they can apply it towards their down payment---instead of having them wait for the credit when they file or amend their tax returns.

This is great news for potential and credit-worthy first time buyers that want to buy a home they can now afford, but just don't have the down payment---3.5% for FHA backed mortgages, 20% down for Conventional---needed to secure the property.

Florida Governor Charlie Crist supports this initiative brought forth by the National Association of Realtors (NAR). Missouri is the first state to approve and move forward with the upfront tax credit to first-time home buyers, and New York is following suit.

As Clearwater and Tampa Bay Real Estate grows with the addition of more distressed properties---we hope this legislation will succeed and allow for more prospective buyers to purchase homes they otherwise would not have considered.

Is Cash The New Favorite?

For the past four months, most residential sales were accomplished by the buyer bringing cash to the closing. The fact that conventional mortgages have dried up has caused the cash deals to look like they are soaring. In fact they are not. They are continuing at about what looks like a normal pace. Since 2001, which is as far back as our statistics go, there has been between 200-400 sales each month that are all cash closings. From July 2006 through December 2007, the cash closings declined into the 160 to 190 range. Beginning in January 2008, cash closings rose back to the levels we used to see.

Cash closings are jumping out at us right now because of the imbalance in conventional mortgage availability. The reduced number of conventional mortgages creates a perception that there is a boomlet in cash deals. The reality is nothing has replaced conventional mortgages. There is a slight increase in FHA mortgages. The surprise is that more of these types of loans are not being done. Tapping into FHA and VA mortgages which have recently streamlined their processes would seem to be a no-brainer, but they are not really making a dent in the market.

Can anyone explain that? Clearly, the availability of conventional money is desperately needed in the Tampa Bay real estate market and specificaly for Clearwater real estate sales to increase. As of now short sales in Clearwater and short sales in Tampa Bay at large will dominate our market for some time.

Realtors See Rise In Hillsborough County

Home sales were up in March across Hillsborough County as some real estate practitioners hope the housing slump is in the past.

Some 1,400 homes were sold last month in Hillsborough, according to the Greater Tampa Association of Realtors, the best figures since June 2007. The sales were up 25 percent over February and 20 percent from the year before.

The average sales price also is up from $160,145 in February to $168,071 in March, creating sales in Hillsborough of $235.3 million, compared to $179.4 million the month before.

“Our members have been saying they are seeing positive movement in the housing market. These latest statistics prove that they are indeed experiencing a more positive market,” said Carol Austin, GTAR chief executive officer, in a release.

Nearly 17,000 homes still remain for sale, representing an inventory of just under a year. However, that’s the lowest inventory Hillsborough has seen since October 2006, and inventory was more than 17 months just a year ago.

“These statistics are extremely positive,” said Jack Rodriguez, GTAR president, in a release. “Hopefully it signals a trend to better things ahead, both for real estate and the economy in general.”

The Florida Association of Realtors is scheduled to release its March statewide existing home and existing condominium sales numbers on April 23.

Pinellas County Housing Update: March 2009

All the signs are there. It could be a year from now that we will all look back and say, “I sure wish I’d known that the first quarter in 2009 was signaling a change for the better in the housing market.” Not that we don’t still have challenges facing us, but as each month goes by, it is becoming clearer that we are in a slow recovery pattern.

Here’s why we believe this to be the case:

Absorption Rate: The 7.7% of the single family inventory sold was more than a full point better than in 2006 and way ahead of last year. It’s true that it was half of 2006 – but, hey, that was still the boom. Even condo sales at a 4.9% absorption rate improved over both 2007 and 2008.

Inventory: The number of listings on the market continues to drop. As the spring selling season got underway, the number of single family and condo listings on the market reached their lowest points since March of 2006. (Do I need to remind you we were still in a boom market then?)

Units Sold: There is definitely in the upward trend in units sold, especially for single family homes. Single family unit sales were up 19.3% year over year in March. Condo unit sales showed a 17% increase over March of last year. It’s too early to say whether that will hold, but on the positive side but this is only the second month in the past twelve months in which sales outpaced the rate for the previous year. (December 2008 was the other month.)

Affordability: Since July of 2008, the Tampa Bay area has been growing increasingly more and more affordable. This March, a family of four with median income (about $52,000) had enough and more to be able to qualify for a median priced single family home ($140,000) with a 30-year fixed rate mortgage and 20% down payment. (Click here to see the current Affordability Housing Index for our area.)

Median Price: When compared year over year, median prices are still dropping significantly, so in that respect the market has not bottomed out in our area. Remember though, the plus side of this trend is that Pinellas is already a bargain hunter’s paradise and soon may become irresistible. At least, we hope so. The single family median price dropped 24.5% when comparing March 2009 to March 2008. Condo median price tumbled 21.9% from March 08 to March 09. Single family homes in our new mid-price ranges ($100,000 to $249,999) accounted for 46.5% of the unit sales in March. The lower range (up to $99,999) tallied 32.59% of sales. The upper end of the market continued to be weak with no sales reported of $1,000,000 or more. 20.7% of the sales were in the $250,000 to $999,999 range.

Condo price range sales track similar to single family ranges. 44.9% of sales were in the $100,000 to $249,999 range. 38.3% in the lower range and only 16.9% in the high end. We expect the trends to continue over the next two months at least. Contracts written for single family homes increased a whopping 34% over March 2008 and condos contracts pending are 17% higher than last year.