The Pinellas marketplace in February was impacted by several factors. The first is available money: tighter restrictions on credit, difficulty of getting any type of loan on condos, and wary consumers are all keeping the lid on what would otherwise be a recovering market. Secondly, the buyers in the marketplace are bargain hunters. Finally, the chaotic pre-foreclosure market is casting a pall over the housing market as a whole. All the factors from confusion about who actually owns the loan to who has the right to review and accept or reject offers on these properties has hampered the ability of seller, lenders, and Realtors® to move these properties off the market.
Until this problem is solved, we are likely to remain in a stagnant market.Let’s take a closer look at the distressed property situation. Twenty-two percent of all sales and 20% of all active listings in February involved a distressed property – that means they were either a foreclosure sale or a pre-foreclosure/short sale. Of the 320 properties sold in this category, 56% were foreclosures and the rest were short sales. Clearly, while 80% of the properties on the market are not in this category, they are being impacted by the discounting going on in the distressed segment. Since 2001, cash sales have accounted for about 20% of the financing types reported to the multiple listing service.
Conventional loans dominated the market taking up 60 to 70% of the financing types. In 2008, the cash deals jumped to 36% and so far this year they are making up 49% of the transactions. We are also seeing a spike in FHA loans; currently 12% of the transaction types. Are there any conventional loans out there? Apparently so, since in 34% of the sales, buyers were able to obtain conventional loans.There is a continuation of the trend of a slightly improved single family home market, even with all the talk about short sales and foreclosures. In February, single family sales were 19.7% higher than February 2008. The absorption rate at 6% reflects declining inventory and increased sales. The February 2009 rate is an improvement over both February 2007 and 2008. Speaking of inventory, the number of available properties on the market was 13.4% lower than February 2008. Median price rose to $139,900 in February compared to $124,500 in January; however year over year there was a 21.8% drop. The condo market persists in providing a drag on the market. Sales were down 8.3% compared to February 2008, although they were up by 40% from January 2009.
The absorption rate at 3.9%, mirroring the single family rate, does show slight improvement over 2007 and 2008. Properties available in this category continue to decline in number. In February 2009 there were 16.5% fewer listings than in February 2008. The median price for condos fell to $118,000, a 24.2% plunge. What will the story be during our peak season? It seems certain that foreclosures and short sales will continue to dominate the conversation, but don’t forget that 75 to 80% of our market is made up of properties that are not in this category. It is important for your sellers and buyers to understand that while the non-distressed properties may not be discounted as much, they are much less frustrating to purchase.
Until this problem is solved, we are likely to remain in a stagnant market.Let’s take a closer look at the distressed property situation. Twenty-two percent of all sales and 20% of all active listings in February involved a distressed property – that means they were either a foreclosure sale or a pre-foreclosure/short sale. Of the 320 properties sold in this category, 56% were foreclosures and the rest were short sales. Clearly, while 80% of the properties on the market are not in this category, they are being impacted by the discounting going on in the distressed segment. Since 2001, cash sales have accounted for about 20% of the financing types reported to the multiple listing service.
Conventional loans dominated the market taking up 60 to 70% of the financing types. In 2008, the cash deals jumped to 36% and so far this year they are making up 49% of the transactions. We are also seeing a spike in FHA loans; currently 12% of the transaction types. Are there any conventional loans out there? Apparently so, since in 34% of the sales, buyers were able to obtain conventional loans.There is a continuation of the trend of a slightly improved single family home market, even with all the talk about short sales and foreclosures. In February, single family sales were 19.7% higher than February 2008. The absorption rate at 6% reflects declining inventory and increased sales. The February 2009 rate is an improvement over both February 2007 and 2008. Speaking of inventory, the number of available properties on the market was 13.4% lower than February 2008. Median price rose to $139,900 in February compared to $124,500 in January; however year over year there was a 21.8% drop. The condo market persists in providing a drag on the market. Sales were down 8.3% compared to February 2008, although they were up by 40% from January 2009.
The absorption rate at 3.9%, mirroring the single family rate, does show slight improvement over 2007 and 2008. Properties available in this category continue to decline in number. In February 2009 there were 16.5% fewer listings than in February 2008. The median price for condos fell to $118,000, a 24.2% plunge. What will the story be during our peak season? It seems certain that foreclosures and short sales will continue to dominate the conversation, but don’t forget that 75 to 80% of our market is made up of properties that are not in this category. It is important for your sellers and buyers to understand that while the non-distressed properties may not be discounted as much, they are much less frustrating to purchase.
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