“Sellers Prices Left The Market” In Florida
The News Herald reports from Florida. “Bay County’s housing market came back to earth last year and will continue building steam in early 2007, says the president of the Bay County Association of Realtors. Acknowledging that 2006 was a ‘tough and challenging’ year for housing sales and prices, association president Teresa Dyer said she thought the area’s market had corrected itself.”
“Prices for existing area homes dropped 12 percent in November, with a median sales price of $201,200, according to FAR. The median sales price in November for an existing Panama City-area condominium declined to $275,000.”
“Some homeowners are still in denial about their homes’ values, (broker) Tom Neubauer said. ‘The ones that are realistic are selling their homes,’ Neubauer said.”
“Neubauer said the county has a high housing inventory, with an 18-month supply of single-family housing and a 3- to 4-year supply of condominium units.”
“Despite the 2006 decline in area housing sales and prices, Dyer said there are still 1,461 members in her organization. She said the association will not know until Jan. 25…that’s the deadline for members’ renewal dues. ‘When somebody drops off, there’s always somebody to take their place,’ Dyer said.”
The Associated Press. “The owners of nearly 500 mobile homes in one of the last waterfront trailer-park towns in South Florida stand to become instant millionaires if they agree to sell to a developer.”
“Palm Beach County Commissioner Mary McCarty is not so sure it’s a done deal because of constraints on zoning, water, sewage and traffic. ‘I find the developers extremely optimistic to the point of being delusional,’ she said.”
“For one thing, the community is in a hurricane evacuation zone and has few ways in or out. Developers will have to clear their plans through the state before any dirt is moved, and neighboring communities will have a chance to weigh in.”
“‘This would be extremely complicated and extremely unpopular,’ McCarty said. ‘But people see dollar signs and it sparks the imagination.’”
From NBC 2 News. “Real estate agents say they expect Southwest Florida’s sagging housing market to pick back up in 2007. Good news for sellers, like Robert Christopholidge, who have had their homes on the market for several months.”
“‘They were selling real good last year during the boom then I don’t know somebody pulled the plug. Some people are looking, but a lot are just not purchasing,’ said Christopholidge.”
“That meant in order to attract buyers; sellers had to lower their prices. Christopholidge dropped his price nearly $200,000. ‘It was $445,000 somewhere in there and all the way down to $260,000,’ he said.”
“‘Some people say well the buyers left the market that’s not actually true - what we like to say is the sellers’ prices left the market,’ said (realtor) Jim Woodard.”
“Agents admit there are still lots of homes on the market, but say there are buyers out there too. And Christopholidge may be proof. ‘He got an excellent deal you know, but I guess that’s what everybody’s looking for,’ he said.”
Seems like every realtor in every city is saying that 2007 will be the year for shrugging off the slump. Are these talking points that I missed?
Mugsy,
Are you relying on real reality? Get with the program! Create your own reality! Don’t let nothin’ get in the way of you having it your way. If you say it often enough it must become true (this is a scientifically proven fact, unlike that pesky global warming thing).
If the world refuses to cooperate, create harder and farther down the road.
“The owners of nearly 500 mobile homes in one of the last waterfront trailer-park towns in South Florida stand to become instant millionaires if they agree to sell to a developer.”
This would be a difficult choice for me. Living in a community you love is great (and somewhat rare these days). But getting $1.5 million for a home you paid $155K for…geez, that’s a tough one. Money really does talk at certain levels.
You have to take quality of life into consideration too. These effing developers are sickening. Say you already felt like a millionaire with $5k a month in pensions and SS coming in AND lived on the water, then becoming a ‘millionaire again’ doesn’t sound so great. I’m sure there’s a vote in the community too so that even if you want to stay but 51% of the people want to be millionaires, well, you’re out of there. More private property violations. This really falls under more of the eminent domain bullshit. How about they just pave over all of Florida so that everyone can get there and go to museums to see what Florida looked like before it was taken over by developers. I’m sure there’s a concentric circle of hell for developers.
Keep the million five. I am staying right here in my trailer till mother nature takes it. Then I am going to whine that I couldnt afford insurance and now have nothing but my carton of discounts cigs and my box of wine.
Remember Jesse Hardy?
http://edition.cnn.com/2006/US/01/13/zarrella.bts/index.html
They should have given him a life lease on the place, with a no-development stipulation, and a bucket of money.
eastcoaster,
Rare indeed! One sharp poster here made the comment that having a beach/lake or retirement home used to imply having a “setting”? Sorry, as much as I’ve grown to dread OR’s rain I can’t picture myself “shoe horned” into a 3,800 sq. ft. lot in LV!
Given their current market I can’t believe some developer is even contemplating this bold an action. Best of luck with that guys!
Yes, the fact that someone is wanting to take this land is mind boggling. Talk about risk. They had better be sure that they buy at an enormous discount to recent prices. I know folks with experience in land, and know for a fact they bought a lot of their property from fools who grossly overpaid. We are literally talking pennies on the dollar here.
When somebody drops off, there’s always somebody to take their place,’ Dyer said.
Thank God for Realtors. We will need these people the next time there is a D-Day.
‘ The Panama City MLS Web site listed 2,199 residential single-family homes and 2,157 condominiums for sale late last week. Dyer said there are still 1,461 members in her organization. Neubauer said the county has a high housing inventory, with an 18-month supply of single-family housing and a 3- to 4-year supply of condominium units.’
Not many sales to spread among those agents.
Realtor.com is showing 3,157 condos for sale here, not 2,157. Looks like the News Herald might have made a mistake, which is not unusual.
The amazing thing is the cockeyed optimism that is still rampant. Everyone is convinced that spring will bring back the boom, the new airport will make this area the next Palm Beach, property values will return to 30%+ yearly appreciation, etc. It’s not unusual to find a few people who still believe in Santa and the Tooth Fairy, but this is like a mass delusion that has swept an entire community.
Also, they only sold a grand total of 28 condos last month, so at that rate there is more than a nine year supply on the market.
Bear in mind that this number is only the stuff on the MLS–the beach is lined with enormous projects going up right now that are being handled by the development companies themselves. Throw those in and the total number of available condos is probably several times the MLS number.
And yet so many people think everything is just peachy keen. I have learned to keep my mouth shut, because people get downright sullen and resentful if you suggest that maybe there is a problem when there’s years and years worth of inventory on the market and no one buying.
I spent several spring breaks on Panama City beach during my college days. Not to demean the area or the people who live there, but architecturally what I remember most was the two-story inflatable replica of a Budweiser.
I think I read somewhere that “Club La Vela” was demolished for condos. True? In my opinion that would not have been a great loss.
LOL…Beer is a lot of what I remember about my college days, too. Sometimes I suspect there was something more (maybe not in Panama City).
There were plans to replace La Vela with a condo, but they fell through–not an uncommon occurrence lately.
That happened with Miracle Strip, a very cool 1950s amusement park, complete with an old school wooden roller coaster. Generations had fun there–it was a real treasure.
Miracle Strip was torn down to build “Miracles,” a resort.
Two years later, there’s nothing but a pretty sign and a lot of rubble and weeds there. There’s quite a few sites like that around here: a beautiful “artist’s rendering” fronting a site that looks like Berlin after the war.
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“Neubauer said the county has a high housing inventory, with an 18-month supply of single-family housing and a 3- to 4-year supply of condominium units.”
Panama City, Destin, and Ft. Walton Beach is wall to wall condos. Amazing that the barrier island hasn’t sunk underneath the weight of all that concrete.
Portofino on Pensacola Beach has stalled/cancelled building two additional towers which were scheduled to break ground in 2006 so maybe the message is finally getting through to some developers. Prices seem to be collapsing rapidly on units available in Portofino’s completed towers while listings are growing by the week. Seems to be a competition to see who has the rights to scream “the lowest priced unit in Portofino” in the MLS.
PP- 2003, I had a week rental in on of the Portofino rentals. I loved it but had no desire to go back. There are too many place around the world I wish to vacation in and I have no desire to go back.
I was shocked at prices these places were going for then and that was pre-Hurricane.
I hear ya. I grew up in Pensacola and subscribed to the “most beautiful beaches in the world” line until I actually began to travel the world. NWF has good beaches but there are a number of places in the world that have beautiful beaches with better water and a longer season.
Better to rent for a couple weeks or months a year than to buy in my opinion–you don’t need to buy a cow if all you want is milk!
“‘Some people say well the buyers left the market that’s not actually true - what we like to say is the sellers’ prices left the market,’ said (realtor) Jim Woodard.”
==> Elvis has left the building
The Naples Daily News reported yesterday that 40% of local realtor association members had not paid their renewal dues by the December 15th deadline, so in an unprecented move, the Association has extended the deadline 40 days until January 25th.
I guess their hoping the realtors got enough money from Santa to pay the appr $200 dues. They sure didn’t make it in commissions.
Coldwell Banker has closed 15 offices in Florida in the last 45 days. Balistieri RE and GMAC RE have each closed two offices in the Boca Raton/Deerfield Beach market, previously thought to be somewhat insulated from the downturn.
I’m assisting a sub-prime borrower right now with her soon-to-be defaulted mortgage. Let’s just say that in the four years since the inception of her mortgage, she hasn’t made a mortgage payment on time, ever. And when she does pay she pays whatever she can….sometimes it is less than the amount due; sometimes it is more; often she doesn’t pay at all and plays ‘catch-up’ the next month be remitting two or more payments.
She’s had the loan a few years now. It’s a 30 year fixed at a little under 6.5%. Now, IMHO, 6.5% does not at all accurately reflect the enormous amount of risk this subprime lender is facing with this borrower. Investors are taking on huge risks for extremely little return. This entire system is going to implode. This borrower is literally one paycheck or one major car repair away from bankruptcy.
Nonetheless, as of today, she is about four payments behind….I’m going to help her get caught up. Two of her payments were misapplied (long story) and she is only two payments behind as of today. She has the money though.
I have a prediction that this firm is going to be extremely busy in 2007. Our foreclosure, bankruptcy and litigation business is going through the roof. Yesterday I opened up nearly a dozen new files. Looks like my position at this firm will weather through the upcoming recession!!
Can’t you just trick her and get her several payments ahead? Then she’ll think she’s always behind, but will really be on time.
Good one Suzanne,
LMAO
Why not help her with her foreclosure and put her out of her misery. You would shoot a rabid raccoon wouln’t you?
I’m assisting a sub-prime borrower right now with her soon-to-be defaulted mortgage. Let’s just say that in the four years since the inception of her mortgage, she hasn’t made a mortgage payment on time, ever. And when she does pay she pays whatever she can….sometimes it is less than the amount due; sometimes it is more; often she doesn’t pay at all and plays ‘catch-up’ the next month be remitting two or more payments.
She’s had the loan a few years now. It’s a 30 year fixed at a little under 6.5%. Now, IMHO, 6.5% does not at all accurately reflect the enormous amount of risk this subprime lender is facing with this borrower. Investors are taking on huge risks for extremely little return. This entire system is going to implode. This borrower is literally one paycheck or one major car repair away from bankruptcy.
Nonetheless, as of today, she is about four payments behind….I’m going to help her get caught up. Two of her payments were misapplied (long story) and she is only two payments behind as of today. She has the money though.
I have a prediction that this firm is going to be extremely busy in 2007. Our foreclosure, bankruptcy and litigation business is going through the roof. Yesterday I opened up nearly a dozen new files. Looks like my position at this firm will weather through the upcoming recession!!
This subprime borrower you describe is characteristic of those who set the bid in the home purchase market at levels which those unwilling to gamble with their household finances could not begin to approach. Until these individuals no longer qualify for “free money until bankruptcy”, nobody with a credit rating and savings should consider buying a home. The most important thing is to diversify your savings sufficiently to weather whatever kind of economic upheaval plays out as the subprime money crawls back under the rock from which it slithered.
These are the kind of people who should be paying 12% interest. In this lady’s case, the problem doesn’t seem to be lack of money so much as lack of money management. Even if her income were $10,000 a month, she’d find a way to spend at least $12,000. Oh well, in a few years she’ll be foreclosed and back to renting.
“I think there is pent up demand…,” said Woodward. Christopholidge may be proof … his house just sold. “He got an excellent deal…,” he said.
Stop the presses. Firstly, Christopholidge dropped his asking price from 445k to 260k and that is an excellent deal in realtor Woodward’s eyes. I would like to hear this realtor’s definition of a raw deal. Secondly, what pent up demand? Everyone I talk to in Florida is waiting for the Spring bounce but we all know there is going to be a bloodbath because of pent up supply.
It is gut check time for some Florida sellers. Some cannot hold out for prices anymore. Taxes, insurance, blah blah blah, are overwhelming family budgets. Add to the mix, falling prices and the potential for further price drops and you get the picture. You would be insane, oblivious, or simply stupid not to walk away from this market if given the opportunity, any opportunity.
And as we get closer to the “Spring bounce” we also get closer to the opening of the hurricane season.
Yesterday’s announcement from Lennar was an ominous warning to Florida and California stakeholders. The strategy now is to minimize losses, preserve capital, maintain market share, and hope to stay cash flow positive. A cutthroat pricing storm is brewing. All the specuflippers and other overextended riskloving stakeholders are going to be wiped out as a result.
A cutthroat pricing storm is brewing
Not gonna happen, at least not as well as you think it will.
The builders exist on cash flow. They are dependent on cash flow to pay
-salaries
-contractors
-the interest, etc on all their loans
-the rest of their operating expenses
The builders are already showing HUGE losses as it is. Most don’t have a strong cash position because they burned through their cash either buying land at the top (which they’re now taking charges for) or they used it to buyback shares so that their CEOs could be rich.
Thus, they’re cash poor with high operating expenses. They are somewhat like the FB… they NEED to sell at a certain price. The 24% profit per home is in the past my friend.
We’ll see a few HBs go under. Some of them will be the big boys… I wonder which ones?
HIC
“The owners of nearly 500 mobile homes in one of the last waterfront trailer-park towns in South Florida stand to become instant millionaires if they agree to sell to a developer.”
You have to take quality of life into consideration too. These effing developers are sickening. Say you already felt like a millionaire with $5k a month in pensions and SS coming in AND lived on the water, then becoming a ‘millionaire again’ doesn’t sound so great. I’m sure there’s a vote in the community too so that even if you want to stay but 51% of the people want to be millionaires, well, you’re out of there. More private property violations. This really falls under more of the eminent domain bullshit. How about they just pave over all of Florida so that everyone can get there and go to museums to see what Florida looked like before it was taken over by developers. I’m sure there’s a concentric circle of hell for developers.
Carl Hiaasen agrees with you!
Sheesh …Buying a house in Florida today isn’t just “Catching a Falling Knife”, it’s more like “Falling on the Sword” for someone else’s RETIREMENT !
Hey, its not their money. Hell, its not even real money!
I like “Catching a handgrenade without a pin”
” Some say the buyers have left the market……what we like to say is the sellers’ prices have left the market”
What an ass! Yes, the buyers left the market! The jerks that were lining up for lottery lots, were not real buyers! They were flippers! The real buyers left the market two years ago! What’s left are few buyers and too many flippers properties, thus lower prices!
Bet the people that bought houses from him in ‘05 are fuming!
“Prices for existing area homes dropped 12 percent in November, with a median sales price of $201,200, according to FAR. The median sales price in November for an existing Panama City-area condominium declined to $275,000. Some homeowners are still in denial about their homes’ values, (broker) Tom Neubauer said. ‘The ones that are realistic are selling their homes,’ Neubauer said.”
The realistic ones are those who are pricing to sell (aka pricing below the rest of the herd), and getting their homes sold quickly. The result is the comps are rapidly adjusting to the realized (lower) sales prices of homes which are moving, which tends to quickly leave the rest of the herd up on a relatively higher perch of denial.
The other thing that really s^cks for condo owners in denial against the backdrop of a collapsing market is that there tends to be a comp glut when inventory is running as high as currently. Even if very few homes are actually selling in a given condo development, there is little secret about current market value.
The same comments apply to tract home developments with many very similar units (in contrast to yesteryear’s $500K+ range homes, which were generally one-of-a-kind custom-built homes on estate-sized plots).
GS - so true. Nothing is worse than holding a commodity in a falling, transparent market. There’s absolutely no way to get pricing power. These condos will see the same fate they’ve seen in previous corrections - big haircuts and fire sales.
dd
I am guessing that what is different this time is that many more SFRs will suffer the same fate that condos normally do in a real estate bust, thanks to the massive overbuilding of McMansions and the drastic encroachment of equity locusts and subprime buyers into McMansion zones.
I agree; single-family residences will act more like condos this time around. Due to the cookie-cutter McMansion design, the newer SFR’s have become commodities like condos. At the same time, the because buying bare-bones lofts and customizing them has become popular, condos have become much more differentiated from each other than in the past…
Not to forget that information is so much more readily available this time, closing the circuit so to speak.
Josh
“Not to forget that information is so much more readily available…”
Josh — you misspelled disinformation.
18 month supply for sfh, 3+ years for condos……..and they tell us here in Chicago that it is a buyers market with 6.8 months of supply. What kind of a market are these guys in Florida? Rhetorical question, no answer needed.
Is it spring yet???
Since this is a Florida thread, Mike Morgan of Florida has a new blog on large builders doing poor work. I think he is an east coast of Florida RE agent. Well worth a look and I bet our Hero Ben has a link to it some day.
http://www.lennar-homes.info/
Chris - thanks for the link. It has been around for quite a while, though. Mike Morgan seems to be the most honest broker in Florida and frequently contributes opinion, analysis and exchanges on Mike Shedlock’s excellent blog (”Mish”).
Premonitions of a bubble on the verge of popping do not ruffle those who are bullish on real estate. In Miami, Ron Shuffield, president of Esslinger-Wooten-Maxwell Realtors, predicted that a limited supply of land coupled with demand from baby boomers and foreigners would prolong the boom indefinitely.
“South Florida,” he said, “is working off of a totally new economic model than any of us have ever experienced in the past.”
Lawyers out there… Has Ron been served yet?
They’ll work off the totally new economic model the same way .com stocks didn’t have to listen to pesky P/E ratios and quarterly numbers and were working off of the perpetual motion money machine. Keep that venture capital money flowing, baby!
You know, the NBC2 article is a perfect example of why I almost never read or watch local news. It is nothing but crap reporting on fluff stories. Wow, what a shocker, realtors think that things will probably pick up in 2007! What the hell do you expect them to say, they are sales people. IMO, this is a non-story. Might as well go interview the local car dealer and ask him how he thinks business will be next month. I bet he says great.
In Boca Raton last week visiting friends and my old house was for sale ($810,000) It last sold in 2000 for $235,000. I almost gagged when I read the flyer. That to me was truly amazing. It’s not an 800k house, hell it’s not even a 400k house.
I also saw a townhouse for sale in the community my friend’s live in. In 2000, you could buy a unit there 3br/2ba for 150-160k. Today they are asking 450k for these townhomes in central Boca.
This is / was a middle class neighborhood, in both instances. Who the heck could afford to live in these places?
FWIW.
They are saying the market has corrected itself. Here is a thought …
if the market dropped from say 500,000 to 450,000 (just a hair of a correction after it went from 150 to 500K in 5 years) and now has begun to stabilise and has evened out, its now at 450,000 not back to the 500 you had it dreamt at in 2005. even if it starts to appreciate, its not going up from 500K, its going up from 450K.
Cool.
Cow_tipping.
“We’ll see a few HBs go under. Some of them will be the big boys… I wonder which ones?”
HIC
————-
I own a building lot in Lehigh Acres Fl since ‘86
A builder dumped his overage from the concrete pour on my property and so I did a little research on them before confronting them about it.
They are not even from this area of Florida,,,, try NW Florida and they have 1200 properties in Lee County now.
The property values/taxes just went through the roof and with insurance rates etc. adding to the cost of home ownership,,,, I guess I was just surprised to see that they bought so many properties up front.
I’m a small business man and I’m always watching the backside.
Gee, wonder what the tax bill is on 1200 empty building lots?
It’ nice to hear, usually from realtors, that buyers will now be coming in droves now that the market has cooled down while prices have gone down. The more realistic picture is while the prices indeed have gone down from the stratosphere, the costs of housing in Florida remain prohibitive for the average American family, leading a lot of people to wonder where the state is going to get the teachers, nurses, firemen, policemen, and an assortment of other workers to maintain a viable economy.
In Daytona Beach, for example, 2 to 3-BR condos on the oceanfront or riverfront command prices starting at over $400,000 that severly limit potential clients. On top of the high taxes in the state, that would exact a heavy finaancial burder for reitrees unless they get a package like the recently deposed CEO of Home Depot (who ran away with an umbrella package of over $200 million.) It’s no wonder a lot of those condos are sitting idly there, with no occupants.
To be fair, the housing bust we are seeing is worse than people in the business admit. Home and condo buyers, particularly the speculators, have been crazed by get-rich-quick schemes the past few years. I don’t see any encouraging sign that things will get any better soon.
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