‘A Bit Of Anxiety’ In Florida
The St Petersburg Times has this report from Florida. “Coming off an unusually weak summer sales season, many Tampa Bay area home sellers are confronting a market reality they’ve dreaded: They’ll have to cut prices. With an average of nine homes on the market for every buyer, the biggest supply and demand imbalance in years, prices are suffering.”
“In Pinellas County, sales prices of single-family homes dipped from $252,000 in June 2005 to $238,000 in June 2006, a decline of 5.5 percent. The market hasn’t given back so much since the 1990s. ‘Price reduced’ on ‘For Sale’ signs have become as common as mildew on mailboxes.”
“Another sign of deflation emerged in the condominium category. Regionally, condo prices dipped about 3 percent from May to June, from $178,000 to $172,000.”
“Builders have resisted outright price cuts, but KB Home, the nation’s fifth largest, was among the first to break ranks by slicing prices $10,000 across the board in one of its Pasco subdivisions. Buyers who signed contracts at the previous higher price are allowed to rewrite their contracts at the lower price.”
“KB Home’s Cara Kane said the company spurns the incentives used by other builders as ‘temporary discounts.’ ‘With our lower prices we’ve been seeing good traffic. Some of the other builders might not be,’ Kane said.”
“It’s no mystery what’s pressuring prices: Home listings have exploded as sales have softened. Many listings are from investors who bought during the boom and fueled what builders viewed as a freakish market last year. Total listings in Pinellas, Hillsborough and Pasco have hovered around 35,000 as monthly sales struggle to break 4,000.”
“The price cuts are nailing some investors who entered late in the game. They face the prospect of breaking even on their homes, or worse. Many have turned to renting as a desperate expedient. ‘We’re getting calls, ‘We can’t sell them. Please lease them,’ said central Pasco Realtor Pam Koenig, who pulled listings for 130 properties chasing renters in Land O’Lakes alone.”
“Realtors like Jim Knetsch think the market has yet to hit bottom. With the current glut, those who want their home noticed slice the price. ‘Every time this year we thought the market might have found its footing, it was a dead-cat bounce and the market fell further,’ Knetsch said.”
“‘It’s kinda scary,’ Ellenn Poyssick, 41, an investor seller, said as she showed (realtor) Shane Whitlatch a home in St. Petersburg that she and her husband fixed up. She and her husband have renovated eight houses and always sold them on their own. But recently, one of the homes in Tampa’s Seminole Heights didn’t get a single showing in four months. ‘I was so desperate, I went ahead and leased it,’ she said.”
“A condo-shopping couple from Atlanta whom Whitlatch was helping suddenly has hundreds to choose from, and more every day. Pinellas County sellers alone placed 31,740 condos on the market in the first five months of this year, up from 9,055 the same time last year. Home buyers faced a similar abundance: 45,677 homes this year compared with 17,563 homes last year.”
“In June 2005, 60 percent of all homes listed on the market sold. This year, just 10 percent of all homes listed on the market sold in June. The real estate decline in the Tampa Bay area is seen across Florida.”
“‘There’s a bit of anxiety in the market,’ said Brad Hunter, a housing analyst in West Palm Beach. ‘Fewer people are buying because they are afraid that they’ll make a mistake if they buy at the wrong time and then the market goes down. And a lot of buyers are saying, ‘Why don’t I wait until the price gets better?’”
From Bloomberg. “Locals call Naples the ‘bubble city,’ with home prices that have surged 140 percent since 2001. That’s making it tough for employers. ‘We have a workforce housing problem of acute proportions,’ said Edward Morton, (who) operates hospitals employing more than 4,000 people. ‘It is a crisis that will only get worse.’”
“Simone Gartner, who lived in Naples 36 years, sold her duplex residence, which had doubled in value to $310,000, in 2004. She rented a condo and moved in with friends before relocating to Kernersville, North Carolina, in June. ‘I’m tired of the expensiveness,’ said Gartner, who now pays monthly rent of $650.”
“The value of new residential and commercial construction was down $100 million in the first half of 2006, Volusia County reported Monday. Sue Darden, director of the builders association, said, ‘There’s a softening in the market,’ acknowledging builders are a little concerned.”
“‘How we’ve done business is changing,’ she said. ‘People are adjusting their business plans and their expectations.’ Darden said she wouldn’t say the bubble has burst. ‘No, not in Florida. The world still wants to move to Florida,’ she said.”
“‘How we’ve done business is changing,’ she said. ‘People are adjusting their business plans and their expectations.’ Darden said she wouldn’t say the bubble has burst. ‘No, not in Florida. The world still wants to move to Florida,’ she said.”
Add this to the “Stupidest Comments” list. The bubble has burst all over Florida and it is going to be a catastrophe. End of story.
I added this.
(The price declines aren’t the ear-shattering pops predicted by housing bubble gloom-and-doomers - the Tampa Bay area’s low unemployment and popularity with retirees works against that scenario.)
did this dope notice that even with all those factors, inventory has gone up 4X in his area?
Perhaps not a burst … just very rapid depreciation…
Word.
‘Hillsborough County public schools could be getting a breather after several years of dramatic student growth. After counting fewer heads than expected Monday, district officials said they may have to revise their enrollment projections downward.’
‘SARASOTA — It is time for consolidation, says Scott Sosso. He plans to close the former headquarters of Prudential Cascade, the very office housing his counterparts in the deal.’
‘That closing seems to have caught some former Cascade and now-Palms real estate agents off-guard. It will involve redistributing about 25 agents, in addition to administrative personnel.’
“redistributed”… to McDonalds?
Nice one! Coming soon to a theater near you.
‘home sellers are confronting a market reality they’ve dreaded: They’ll have to cut prices.’
- That’s in Florida ….not here in Southern California
KB Home, the nation’s fifth largest, was among the first to break ranks by slicing prices $10,000 across the board …and allows Buyers who signed contracts at the previous higher price are allowed to rewrite their contracts at the lower price.”
- WTF!! Will the realtors go back and ‘Restate Sales Prices’ for the previous sales averages
Darden said she wouldn’t say the bubble has burst. ‘No, not in Florida. The world still wants to move to Florida,’ she said.”
- Whew! I feel better now….I was worried until Darden spoke up.
WTF!! Will the realtors go back and ‘Restate Sales Prices’ for the previous sales averages
You comedian you.
“‘It’s kinda scary,’ Ellenn Poyssick, 41, an investor seller, said as she showed (realtor) Shane Whitlatch a home in St. Petersburg that she and her husband fixed up. She and her husband have renovated eight houses and always sold them on their own. But recently, one of the homes in Tampa’s Seminole Heights didn’t get a single showing in four months. ‘I was so desperate, I went ahead and leased it,’ she said.”
Sometimes I wonder how much of a disaster a significant reduction in prices would really be for a lot of these speculators. This person renovated and flipped 8 houses. They must have made quite a bit of money from that. So what if, on this, her last one, she loses a 100 thousand or two. She made plenty off of the others.
I thought the same thing.
ditto
I think what happens is that the profit from other “flips” gets eaten by living expenses, sales comissions, traveling, vacations, etc, and when they least expect it, they have maxed out the CC’s, have no savings, and have a very hungry alligator that is eating them alive. They will not know what the hell happened to all their money, untill the sheriff comes knocking on the door to pick up the repossesed BMW/Merc/Lexus, and the HD tv to boot.
If the US weren’t into a negative savings rate, then it wouldn’t be a problem, but with people spending more than they make, faster than they can make it, will make it a disaster. Just in June, over $10 B was added to credit card balances.
There’s a 100 million workers in the US, that’s $100 per worker. Not too bad really. About average. If you never paid it off though, that’d be $1,200/yr, maybe more like $1,600 year with interest. It’s concerning, but doesn’t seem to be at any greater rate than what we’ve seen already.
I tend to disagree. I didn’t study that article, but the conclusion I drew was that “U.S. consumer credit rose by a bigger-than-expected $10.27 billion in June on a surge in credit card debt” because the housing ATM is disappearing. And to me that’s scary stuff. When the credit cards are maxed out it’s game over and this credit bubble is going to unwind faster than a coiled rattlesnake going for a fat rat.
My guess is that the debt is much more concentrated than the average over 100 million.
Don’t forget the Harley, the JetSkis and the Chris Craft.
She gets to keep the boob job, though.
I don’t see why. The investment was clearly a business generating expense and because of the inflationary nature of the product should not be sheltered from creditor seizure. At the very least bag holders should be granted visitng rights and/or partial custody provided they keep a close eye on their assets and hold them up against any depreciation ecepting of course normal wear and tear.
Robert Cote’s wordplay is great. Did nobody else read his comment?
Sniff. That’s okay, some people are mad at me for ruining their keyboards with sprays of coffee, soda, beer, etc. I was at least expecting a groan from the fun bag holder comment. Oh well, this crowd is just too highbrow.
Sub-prime RMBS for all…there’s finally a reason for buying it!
Regards,
Loafer
What reason for sub-prime RMBS is that? To hold up a sagging economy perhaps? To provide support and put some perkiness back in aging market? To tweak the knobs on the engines of growth? Just be sure to underwire your broker to put in some stop losses and make sure to lift and keep separate your varied interests. Asset perfomance at the peak of a bubble is a touchy/sensitive subject for many. This is not a job for amateurs.
“This is not a job for amateurs.”
Thankfully, I’m a professional, and willing to sacrifice myself to the cause…
Regards,
Loafer
I’m late to the board today — Robert’s on a roll. That Johnny Carson-quality exchange should dispel any notions of him being a boob.
Chip,
Thanks for the rosy tips. For the less up to speed I’ll make it clear that my.. err… tongue is firmly implanted… err… in my cheek. Darn, now I’ve corsetted… err… straightjacketed myself… no, let’s not go there either.
“She gets to keep the boob job, though.”
They can take those puppies out. Expect a surge in jobs for repo men for plastic surgeons.
“Hey lady, you need to give those back….”
I always thought that boob appreciation was not reversible until a certain age — much like fine wine until that …day…when depreciation begins.
Forgot to add, unlike a regular job, when you get “laid off” you cannot collect UI. I know that it is a small relief, but at least you have enough to cover your basic needs for the time being.
Since when could you not collect unemployment insurance when you get laid off?
When you are self-employed most states do not pay UI. I believe that the SE UI is only for starting a business, but not when the business goes belly up.
double bingo- thats why job numbers are as good as they are- x agents go to retail jobs and become “employed”
Most of these flippers fancy themselves as RE barons.
When they make a big profit, many/most siphon some of that to live off of (it’s their PROFESSION, so they gotta make ends meet using the profits) and then they plow the rest into new “deals” to make even more money. Remember, money left in your house is “dead money”
many here forget that these “RE investors” are literally trying to do this for a living. It allows them to “escape the rat race” and “live the good life” and “work for themselves” and all that.
Thus,
They make $100k on the first house after expenses
They use $25k for their living expenses
They pour the remaining $75k into 4 more houses
(so they have 4 houses)
They sell one of the houses and make another $100k
(so now they have 3 houses)
They use $25k for more living expenses
and pour the remaining $75k into 4 more houses.
(so now they have 7 houses)
Now the market slows, and they have used $50k, they have 7 homes, and that’s it.
One home starts going under water, so they HELOC one of the other homes (putting it on razor edge) to pay for upkeep/maintenance.
Then the teaser rates start expiring on their 1 and 2 year ARMs, and the payments shoot way up.
They can’t rent for what the new payment is
But they can’t sell, because they’ve mined all the equity of all 7 homes.
Then all it all starts falling apart.
they’re left with nothing
clouseau
This is why I’m not convinced that there is and abundance of “Smart Money” sitting on the side lines. Many of these people that appear to have timed the top have “lucky money” that will go towards debt service on other properties/ assets
IMO. I see wealth evaporation on a grand scale.
We are the minority folks!
I’m not sure that “smart money” even exists anymore.
It’s just lucky money, dumb money and dumber money.
The dumb money got out a long time ago, the lucky money got out at the peak, and the dumber money is left.
clouseau.
I guess I had dumb money. I sold in 2001 for a nice profit and went shopping for a new place. I was convinced that prices were way too high in Boston and would correct like they did in the 90’s, so I’ve been renting ever since. It looked like I made a bad decision, but I’m more optimistic now that I’ll be vindicated. The house next door was listed at $925,000 May 1st and is hasn’t had much activity. The guy bought it in 20001 for $700,000 and hasn’t done anything to it.
I don’t want to sound lame, but why would somone buy a house for $925k to live next door to a renter?
Implosion — LOL. Great dry humor re one of the great ironies of the boom and bust, IMO.
ot but importend to the condition of the mbs market
from netbank ntbk today
Heightened Mortgage Repurchase Activity. Our indirect conforming and non-conforming mortgage operations experienced markedly higher repurchase requests on loans previously delivered to investors. Provision expense within our Financial Intermediary segment totaled $20.3 million this quarter, an increase of $13.2 million from last quarter
by the way. they lost money in the quarter and will probably post a loss for the year.
from germany
http://www.immobilienblasen.blogspot.com/
You should see the nws out of Fremont General (FMT). I posted about it at my blog, http://interestrateroundup.blogspot.com/ But suffice it to say that this CA-based subprime lender is seeing lots of loans go bad quickly AND (drum roll please), it’s tightening lending standards as a result. My take is that this is just the beginning of a tsunami of credit problems.
Mike — very useful link — thanks.
thanks from germany
wunderbar!.
http://www.immobilienblasen.blogspot.com/
largest imbalance in history” is how that should read
” Many have turned to renting as a desperate expedient. ‘We’re getting calls, ‘We can’t sell them. Please lease them,’ said central Pasco Realtor Pam Koenig, who pulled listings for 130 properties chasing renters in Land O’Lakes alone.”
Yeah, well, it’s just as idiotic in the rental market. Rentals are being priced according to what FBs “have to get”, not what the market will bear. So a lot of rentals are sitting also, and will continue to sit.
“Darden said she wouldn’t say the bubble has burst. ‘No, not in Florida. The world still wants to move to Florida,’ she said.”
GAAAHHHHH! It’s idiots like Darden who give Florida a really bad name. And she’s director of the builders’ association? What a moron! No wonder the builders are still building like lemmings determined to go over the cliff. By the time they are done, Florida will be nothing more than a construction waste dump.
1926 all over again?
I love the historical reference. For those who didn’t get this, in 1926 the Florida real estate market crashed. See http://www.stock-market-crash.net/florida.htm
It’s uncanny how similar today is to 1926. Here’s a small excerpt.
By 1925, real estate prices had become so exorbitant that buying land wasn’t affordable any longer. New investors failed to arrive and old investors started to sell. Panic arrived, as it always does, and the real estate market crashed.
I posted a while back about a couple I know who bought into the buy-now-because-prices-will-just-keep-going-up b.s. and bought a new house in Jacksonville. Problem is, she’s in the military and has to stay put in Pennsylvania for another 2 years. Hubby and the two children (ages 4 and 6) moved to Jax. Wife is staying in PA and visiting when she can. I’ve done the long-distance thing a few times . . . all unsuccessfully. I do not wish marital troubles on them, but it will be very hard to avoid.
Also, one of my son’s daycare teachers just announced she and her hubby are moving to FL after her 3rd child is born in September. I will give her my rent-for-a-little-while-and-wait-for-the-market-to-come-back-down-to-earth spiel, but it’s likely to fall on deaf ears. However, they are not a wealthy couple so I hope they can do alright down there.
Eastcoaster, we all try to caution our friends and family, but it all just seems to fall on deaf ears, I don’t know why. I’ve had experiences similar to yours, even recently with the bubble out of the bag and in the news. So it would seem the bubble is still in the denial stages, although maybe at the tail end of the denial stage. I just want this housing crash to be over with.
I told the story to a friend at work. She sold and is in escrow right now, hoping that the buyer follows through. She likes the idea of $200,000 in the bank free and clear to subsidize the rent on their dream house of the next few years, with the potential to buy outright after the crash. Not deaf ears in that case. Balsy!
“KB Home’s Cara Kane said the company spurns the incentives used by other builders as ‘temporary discounts.’ ‘With our lower prices we’ve been seeing good traffic. Some of the other builders might not be,’ Kane said.”
KB Home has a lot of exposure in Florida. They are the original Californicators. Just in a five mile radius of where I live, there are four KB developments with the land cleared, gated walls up, some roads and model homes built and nothing much else going on. Nice to see they are breaking ranks with other builders and slicing the prices, but right now it looks as if that’s only happening in Pasco County, which is basically sinkhole city and where the only company that insures is state run Citizens Insurance. From what I can see from local market observations, the real desperation is taking place in Pasco County. Elsewhere, as the article says, it’s just a “bit of anxiety”, preceding the “rush for the exits” mass psychosis. Provided there are no hurricanes this year, the rush for the exits probably won’t take place until after snowbird season (November through April). If the world doesn’t move to Florida during that time, the realtor pundits might as well stick a fork in it, because it’s done.
david weekley isn’t cutting prices, they don’t want to hurt their previous homebuyers. They’re giving away the lot and $20k in options(including the plasma tv). As I told the salesperson, I don’t mind paying the asking prices, just give me 50% of the home value in options and I will buy since that seems to be where the market will land! No smiles when I left that model. thought she was going to take my daughters cookie back!
“The price cuts are nailing some investors who entered late in the game. They face the prospect of breaking even on their homes, or worse.”
Worse, much worse by the time this is over.
repossesed BMW/Merc/Lexus, and the HD tv to boot.
WooHoo. Repossessed BMers, Mercedes, Lexus’ and HDTVs for all.
yeah, time to split up the spoils
The average Joe investor is the difference this time vs. the 1980s. Back then, lots of young couples ended up living in studios and one-bedrooms for years with two kids, because they were underwater and couldn’t sell. Many ended up renting the place for a negative carry.
But you didn’t have all these flippers with 3-4 units. I think the result will be more foreclosures and sales.
Today, in WSJ (also reported in Tampa Tribune), “Housing Market May Have Hard Fall”. Excerpts and comments:
http://florida-paradiselost.blogspot.com/
Tampa, FL here - I confirm everything written in the article. The local market is toast. I am getting flyers in my mailbox all the time about what a wonderful buy the local condos are and that “it has never been a better time to own a piece of the American dream”. At the local watering hole, people continue to ask me repeatedly if I have bought in ‘X’ condo complex and act like they are some kind of 30-something genuises and look down on me for renting. Oh well.
BTW, my ‘rent from a FB’ search will continue this week. Will keep all updated.
From WSJ today on Countrywide.
In regards to Option Arm’s
Countrywide says it has been careful to give these loans only to borrowers with relatively strong finances. Stil, the test of these loans will come when borrowers face “resets” to higher monthly payments. Mr. Mozilo said during the conference call. “I’m not sure exactly what will happen then,” he said.
YIKES!, not sure what will happen? It is like your doctor giving you a presciption and when he takes you off the medication he is not sure what will happen. Anyone on this board would like to give there opinion on what would happen?
mass hysteria…panic in the streets…dogs and cats living together!
Tampa, FL here, too. The SP Times article was front page today. Even better, though, was the caption under the picture. “Shane Whitlatch, who was ERA Real Estate’s Rookie of the Year last year, and his partner decided not to take a listing from a pair of investors trying to sell 20 homes because the investors priced the properties too high.”
Stupid investors.
Being an investor means that one has researched the possibilities, market, and has a very good picture of the risk vs. reward.
A speculator is someone acting out of gut feeling, water-cooler heresay, or stupiditity that does not have a clean picture of the risk vs. reward scenario.
A vast majority of so-called “investors” are actually “speculators” and should be considered stupid as well.
I don’t think that you can draw a clear line between investors and speculators. I remember reading in Jesse Livermore’s book ““Reminiscences of a Stock Operator” how he speculated wildly while having researched the market, too. Gut-feeling was important to him, but water-cooler hearsay got his full contempt.
I concur to a point - gut feeling is good when the person receiving it has good knowledge of the market and economic fundamentals. When one has a gut feeling that houses or a certain stock is going to take off without any supporting information or unique perspective, it’s a speculative decision and nothing more.
Investors are expecting a return for their time (i.e. information costs of researching markets). Speculators expect a return because they are smarter or riskier than everyone else.
A Pair of Investors LEVERAGED up to the MAX. 20 HOMES! I would really like to see the bank documents that allow this.
I guess chalk another up to old Bubbles Greenspan and the other reckless (most likely fraudulent) members of our banking system that have somehow sanctioned this “anything goes” style lending.
Shameful.
A lot of Tampanians post on this blog. I think there are more of us here than south Floridians, probably because we know that in Tampa there is even less reason to pay high prices.
Amen to that.
As a fellow Tampanian, I am just trying to hang on and hope that our corner of paradise will not be too messed up when this all shakes out. Development has been pretty bad here, but it is nothing compared to South Florida and the Orlando area. Also those areas have been developing for years, whereas Hillsborough and Polk Counties have had more undeveloped land available for the taking, so experienced more building frenzy.
We all ought to have a meetup and blitz some of the new developments that are sucking major wind, shouting the mantra “TOO EXPENSIVE”, like the developers did at the BLM auction in AZ that Ben posted about.
LoL My first stop would be the Gordon Oaks subdivision that went up in Plant City. I don’t think there is a single one of those houses that is owner occupied. Next, I would make my way to Highland Park off of Racetrack Road near Odessa. WAAAAAY overpriced. (Of course, they had to follow the lead of Westchase & Waterchase, right?)
Winter Haven / Lakeland area here - I too, agree with everything in the article. Bandit signs adorn every busy intersection. The worst area though, is up in the Four Corners area, near The Mouse, where all sorts of specuvestors were herded in to hurry up and buy their piece of “paradise” before the “baby boomers get here”.
Now hundreds of properties are sitting abandoned in the Florida sun for sale/rent/ lease to own….you name the game…..these flippers are desperate and are willing to play it.
The Tampa and Orlando Craigslists are a real laugh.
You guys should give it a spin….be sure to keep food and drinks away from your keyboard ’cause I guarantee you will spew with laughter !!! Enjoy !!!
Les, I completely agree. I have been monitoring the Tampa Craigslist RE listings and rentals for a while now. A complete and utter joke.
Howz about that $185K mobile home (plus $483/month for space)? Is this thing propped up on granite or what? Why no photo of this mobile manse?
Tampa Craigslist….
Howz about that $185K mobile home (plus $483/month for space)? Is this thing propped up on granite or what? Would love to see a photo so I could mess up MY keyboard.
Yep. I’ve been following the Craigslist Orlando RE listings for quite a while. The people posting there are perhaps the most delusional of all.
It will be interesting to see how far and fast this thing plays out. There are odd (to me, anyway) developments around Orlando and I can’t help but feel that the maniacal, bubble-psychology had a great deal to do with decisions which were made. One of my favorites is a development on the east side of Apopka-Vineland about 4 miles north of Sand Lake Road near Windermere. Called ‘Savona’, this development is a being constructed on land that was previously an auto-salvage yard. The homes are advertised as priced “From the several millions” and I’m certain that they must be splendid McMansions. A castle of this order would be incomplete without water, so they are dredging a man-made ‘lake’ around these lots. Now, while I don’t have “several millions” to spend on a house, near a big stagnant pond dug in an old junkyard, the thing that really would bug me is the view. This development is virtually surrounded by a water tower and several microwave antennae towers- BIG ones. I’d really like to have heard the conversations when they rationalized launching this albatross. Honestly, drive over that way and see it. It is amazing.
“…Pinellas County sellers alone placed 31,740 condos on the market in the first five months of this year, up from 9,055 the same time last year. Home buyers faced a similar abundance: 45,677 homes this year compared with 17,563 homes last year.”
Are these numbers for real? Are they verifiable? This is a complete disaster! Tragic! Now comes the pain, the whining, the congressional hearings, the lawsuits, the bailouts, and so on.
This bubble is going to make a lot of people depressed and it will have a similar impact on the general economy.
I’ve been following my sister-in-law’s zip code in Tarpon and new homes are added daily. before about 3 months ago, very few listings below $300K - now there are dozens, many alreayd with price drops.
Aren’t you glad you waited???????????? Just think of the bargain you’ll get next year.
add in fsbo’s = + 5-10%
Much of downtown St. Petersburg has become beautiful, but there is way too much construction of hideous, overpriced condos. The biggest project so far has had to delay closings twice now because of flooding in the building. The last time, the builders claimed a washing machine ran all night and flooded many floors below it. This is not credible, since there are no residents living in the building (it isn’t finished), and one washing machine shouldn’t produce that much flooding in any event (perhaps it was illegal immigrants living on-site in return for slave labor). Before that, it was supposedly a sprinkler pipe that burst and flooded 23 or 24 floors, delying closings by two months. Wonder what they’ll come up with next. Clearly, the builders do not want to return the buyer’s deposits, if they haven’t already spent them, and they’re building another highrise condo a few blocks away where the units are even more expensive (millions). The city council that allowed this needs to be slapped. They’re destroying the very beauty so recently achieved (or restored) that made the place desirable to begin with.
That was very well put. I’ve often felt that overbuilding in desireable areas quickly degrades the very quality of life that made them desireable (and occasionally high-priced) in the first place. For example, all the development in south Tampa is turning MacDill Avenue into a busy road, and traffic on Bayshore and Westshore Boulevards has picked up noticeably. The increased density also has turned the intersection of Kennedy and Dale Mabry–not a fun place to begin with–into something reminiscent of Los Angeles.
“…Pinellas County sellers alone placed 31,740 condos on the market in the first five months of this year, up from 9,055 the same time last year. Home buyers faced a similar abundance: 45,677 homes this year compared with 17,563 homes last year.”
But prices will likely just flatten!! Hah!!!
Had my boots on the ground in Tampa last weekend and confirm everything. Was in 2 subdivisions in North Pasco (Waters Edge and Suncoast Lakes) and there were for sale signs everywhere. Each had cul de sac’s where at least half of the homes were for sale. Unfortunately my wife and current situation will not allow me to wait much longer to buy, but I see many, many markdowns from speculators and homes approaching my benchmark $100 per sq. ft. that I would be willing to jump in at. I know I could do better waiting until next year as there will be a bloodbath happening for some of these speculators, but since I am putting money down from my own top-of-the-bubble sale and will be at an affordable level for my income, I should be ok (I plan to stay long term as well).
go door to door and cut the agents out- it works !
buddha, you’re not looking in Pasco, are you? According to my State Farm agent, Pasco has something like 80% of the sinkhole claims in all of Florida and it is practically impossible to get insurance there. North Pinellas is much more stable, if you can find anything there to your liking.
Palmetto,
I am actually looking in North Pasco - I know about the sinkhole problem, but I know quite a few people up there who are pretty happy. I am actually speaking to the builders at these locations and I think they are willing to capitulate to close to my $100 per sq. ft. mark. I would be able to get insurance through the builder. If I go the resale route, I can get insurance, I have an angel from a company that is no longer writing new policies, but is replacing policies as old ones are cancelled. This person could hold one for me.
North Pinellas is very nice, but there is no way I will get a new 4 bedroom 3 bath 2500 sq. ft. on 1/4 acre for 275K there. Maybe a couple years from now but I have a lot of pressure on me to get something in the near term.
Don’t forget to negotiate the pool! It’s a nightmare to wait a few years and put it in later!! We waited as our children are small. With the alarms and fences, I wish I had done it. When we finally did put a pool in(two years later-kids still little), it was such a mess!
I didn’t realize the builders were offering insurance. Great! I don’t know much about the sinkholes except for what I see on the news…… I’m sure it’s only isolated areas.
Yes avoid Pasco if possible. If you decide on Pasco do not committ till you have been on I-75 and I-275 at 7:00am and 5:30pm. Think about an older home in south Brandon
I will be telecommuting most of the time. I will check it out though in case that doesn’t work out.
I second the comments by palmetto. I work/study at USF in Tampa and have several friends who are civil engineers. Repairing damage from sink holes in Pasco county is a very lucrative job for them.
I know, I consider myself to have been warned - however, even though there are a lot of sinkhole claims, the actual odds of any one house or area settling is pretty low. I am still mulling my possibilities.
One of my friends lost her a$$ on a sinkhole home in central Pinellas county (Safety Harbor), so no area is really immune from them. Good luck buddha.
From what i’ve been told, the entire west coast of florida sits on limestone, which can wash out underneath and cause surface areas to collapse. I see the risk as part of the price of doing business there.
buddha, you are probably right. In fact, I rather like Northeast Pasco, in the Dade City/San Antonio area. The old Florida towns are still charming, but a lot of the development that surrounds them is not so nice. Much of the Pasco sinkhole problem is in the center to western part of the county, but the insurance companies flag the entire county.
Regarding your comment about the limestone, that’s true of most of Florida, not just the western part. But Pasco has a problem in large part due to an old water agreement that it negotiated back in the 1970s with Pinellas County, when some nearsighted politicans needed money for what was a rather economically depressed Pasco, not forseeing the future development needs. When I moved to this area from South Florida in 2000 and was looking in Pasco, the realtor who was showing me around pointed out some dry lakebeds and shook her head, saying “Pinellas is sucking us dry”. From what I’ve heard, when Pasco started experiencing problems, they tried to rescind or re-negotiate the water deal and Pinellas said “No dice” and threatened to sue. Since Pasco didn’t have the financial resources (taxes) that Pinellas did, they gave up. As a result, sinkholes in Pasco. It was once the prettiest county and most charming area of West Central Florida, IMHO. Some of it still is.
Palmetto,
You are a wealth of info about Fla.! Of course, I am looking in northwest/central pasco - off State Rd. 52 - so it would be in a bit of danger zone - it is beautiful country up there though - even though they are currently widening the road to 4 lanes west of the Suncoast Parkway, which I am sure will bring more commercial development in addition to the new homes sprouting up around there. But I did drive east on 52 and it is almost all still farms, really peaceful.
Anyway, I have one builder offering me 55K off a 365K house (2650 sq ft, loads of tile, cherry cabinets, quartz counters, all that pretty bubbly upgrade stuff, 3 car garage, 1/4 acre lot with no front or rear neighbors, gated community with fishing lake, pool & clubhouse - basically a resort to a northerner like me) with closing costs paid, insurance at $1800 a year and a 6% 30 yr fixed - I am trying to work it down from there and think I will get it to where I can swing the whole thing to about a $1500 monthly nut for everything if I put close to 150k of my bubble sale money down. Would still leave me a nice chunk in the bank.
For a telecommuter with a NY salary that’s a pretty decent deal & my wife would still be able to be stay at home mom.
buddha, sounds like you are doing a good job under the circumstances. If the builder is paying your insurance, great. If not, just be cautious of the bait and switch between the quote and actual bills after you close. It has happened to more than one person.
Anyway, welcome to the Tampa Bay area. Sounds to me like you will be a great addition to the population.
Buddhaman — are you looking at a “stick” (frame) or block (concrete block) house? I suppose that if the subsdivision is all the same, it won’t matter, but you should know that very few old-time Floridians will not buy a stick home. If it is stick, IMO make absolutely sure that it has a stucco-cut at the bottom. Easy to tell — on the exterior wall, there is an indent just above ground level. Has to do with termites and carpenter ants. Assume you’ve adjusted to the idea of your daughter tolerating the local drawl.
Errors galore in my post — the important one: very few crackers will look at a stick house (unless it is super-old and super-cheap).
Thanks for the welcome Palmetto, I’ll watch that insurance thing. I’m still bargaining, so my final deal may well be even better.
Buddhaman — why not rent for a while and watch the price go even lower? The cost of a move, even using a high-end mover like United, will be a lot less than the capital loss of a purchase made too soon.
Hi Chip,
I thought it was you who I had that little square -off with
- but like I said before, what will be, will be - there are New York accents that I think are pretty cool, and some that I think are atrocious. Same with drawls. I will try to judge each thing I encounter in life on it’s individual merits and not make dumb comments like I made that day.
As for renting, I would love to wait to buy, I think I could definitely get something similar for 250K in next couple years. My wife just doesn’t want to do it at this point. We are living at my sister in law’s house, paying her a nominal rent to help out, and our stuff is already moved down. So we already incurred the cost of one move, and don’t really relish the idea of moving two more times. This is my first big move and it is pretty unsettling living out of suitcases with your stuff all over the place. At this point the builder is taking a 55K haircut and I plan to negotiate even more. If I get it close to $100 per sq. ft., I will take my chances with capital loss. In my opinion, that is pricing from 3 years ago, so it cuts a lot of the insane froth off the top.
As to the construction, it is concrete block - there is wood on second story, but it is all pre-engineered roof trusses that are strapped about a thousand times to all the beams, which are bolted into the block. I’ve watched a bunch of the houses in development go up, can say for sure they are very tight. Of course, I will definitely have an inspector look at the house as well.
I would say jump in at $100 a square foot! That’s around 2000-2001 prices in Westchase(not sure what Pasco was)! I don’t know if you can do that much better! Why can’t you rent for a year? It may be worth it.
“Coming off an unusually weak summer sales season, many Tampa Bay area home sellers are confronting a market reality they’ve dreaded: They’ll have to cut prices. With an average of nine homes on the market for every buyer, the biggest supply and demand imbalance in years, prices are suffering.”
Is anyone out there still saying, “Real estate prices never decrease”?
Ignore? ramous:
http://www.xanga.com/russwinter
This is classic. $350k for a beach, that you can only get to by boat.
http://fortmyers.craigslist.org/rfs/175945232.html
I’ve spent a lot of time in this area fishing. It’s about 6 miles south of Marco Island. And there’s tons more open beach where this one came from. In fact, there’s a couple dilapidated homes around there. There’s some from about the 50s, then a few futuristic looking concrete hulks from the 70s. Literally just a shell of concrete. Whether they were ever finaished or not, I’m not sure, but the concrete ones are significant … and been abandoned for years. The 50s shacks I suspect were just fishing shacks. Anyway, anyone want to spend $350k for a piece of beach you can’t get to, has no power or running water. I’d suspect you could just go down there and dump a Home Depot shed with a generator and enjoy it more than taking out a loan.
Soon we’ll see adds for plastic surgeons desperate for work “Buy one Get one Free”.
Oops, that was supposed to go under the greedy realtors who get to keep their boob jobs. Sorry