February 17, 2014

Everyone Thinks We’re Back In 2007 Again

Miami Today reports from Florida. “Real estate professionals are keeping their eyes firmly on China as more buyers from afar trickle into South Florida. A group from China recently looked at units in Midblock, said L. J. Rodriguez, Midtown sales director for Fortune International. Mr. Rodriguez said the group was interested in buying multiple units. The appeal of Midblock to the Chinese, he said, is that it is existing construction. Also, he said, the price point. Miami Today previously reported the majority of Midtown prices are in the $300 per square foot range – from $375 per square foot for a one-bedroom, one-bathroom in Midblock. Most units have a tenant in place and buyers can begin earning on their investment immediately.”

“‘Why they are starting to look into the Miami area is very simple. California prices, Hawaii prices and New York prices… are way more expensive than the Miami market,’ said Fernando de Nuñez, vice president of the International Division for Fortune International.”

The Palm Beach Post. “Palm Beach County homes spent a median of just 59 days on the market in 2013 before going under contract, down from 90 days in 2012. But people’s expectations on what they can get are sometimes unrealistic, Realtors say. While data shows the average seller got 93 percent of their original list price, that doesn’t mean you can ask for the moon. ‘We’re seeing sellers tending to come out pricing higher than they should be because everyone thinks we’re back in 2007 again,’ said West Palm Beach Realtor Shannon Brink. ‘We are telling them, yes, prices have improved, but you’re not going to get $100,000 more than the last sale.’”

From Highlands Today. “It’s not like the mid-2000s, but Steve Fruit is again encountering customers who want to buy a house, remodel and flip it. ‘I have one current seller who bought a short sale in Sun N’ Lakes Sebring for less than $150,000, and is now listing it for $195,000. It didn’t need much work, mostly cosmetic issues,’ said Fruit, a broker associate with RE/MAX Realty Plus II in Lake Placid.”

“So far, flipping here seems minimal. Instead, said Clerk of Courts Bob Germaine, ‘Mortgage foreclosure sales are all going back to the banks. Very few individuals are buying the property. I would say less than 5 percent.’”

“‘Buyers have to be careful and really know what they are doing in order to make any money,’ cautioned Fruit. TV shows like ‘Flip This House,’ ‘Flipping Out’ and ‘Flip Men’ make turning around a house in 180 days look easy. Don’t be fooled, warned Fruit. ‘I think the ‘reality’ shows are a joke, and I suspect many of the so-called ‘flippers’ that try to emulate them are not successful. You have to be very careful in rehabbing, or you’ll get burnt.’”

The Tampa Bay Times. “With its leaky cushion of investor cash still deflating, Tampa Bay’s housing market entered 2014 with home sales sliding to their slowest level in almost two years, listing data show. Realtors blamed tepid sales on seasonal doldrums, but the deep drop in investor buying, often due to rising prices, also played a role. January saw both the fewest home sales, and the fewest all-cash sales, since February 2012. The median home sold for $143,000, down from the $170,000 summertime peak but still 10 percent higher than January 2013.”

“The thinning sales from local investors could trim Tampa Bay’s market even further, as 47 percent of last month’s sales were bought through all-cash deals. A quarter of the homes sold by Realtors last month were foreclosures, the biggest share since 2011. Most were bought by investors seeking to fix them up for rentals or flip them for quick resale.”

“Calling the housing recovery ‘a long, difficult slog,’ Wells Fargo economists said that the investor exodus had illustrated how modestly the fundamentals guiding traditional housing markets, like job and income growth, had improved.”

From WFTV 9. “Major delays in a program that was supposed to help Orange County neighborhoods hit hard by the foreclosure crisis is costing taxpayers thousands of dollars. Orange County received $40 million in federal money to have foreclosed homes fixed up, bought and moved into. One of the goals was to make sure the homes weren’t bought by investors.”

“An audit by the comptroller’s office however, found big delays left 43 of the homes sitting empty for months, and in some cases years, costing $121,000 in federal money to maintain. ‘When it’s just sitting there for months and nothing’s been done, it seems like a waste of money,’ resident Myrna Figueroa said.”

“WFTV’s Lori Brown found one of the county’s foreclosed homes that was fixed up through the Neighborhood Stabilization Program. That home has been sitting empty for two years and three months. Neighbors said the nicely renovated, three-bedroom, two-bathroom house has looked move-in ready for months, yet there’s no ‘for sale’ sign and it’s not on any real estate website. Mitchel Glasser, who heads the program, blames the delays on an overload of inventory. ‘Quite frankly, we have a lot of listings and a lot of homes under contract,’ Glasser said.”

Bits Bucket for February 17, 2014

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