This week, I would like to hear from you regarding what you're seeing locally, in regards to homes for sale, homes that are selling (or more likely, not selling), and stories you may have.
Here's my report in Northwest Tampa:
- Current neighborhood (about 70 homes) has had 3 homes for sale since the summer. Every one is priced nearly double the value from 4 years ago. Open houses were being held just about every weekend, but now they've stopped. Also, 2 other houses are up for rent - no takers.
- Got serious about making a purchase back in June - looked at 9 houses that were in the right locale, but all were seriously overpriced. Finally got interested in 2 homes, both listed for $400K. One was nearly new, but definitely not worth that price. The other was 10 years old, had been bought out of foreclosure by a local flipper, who had the house repainted, the yard re-sodded, and new cabinets installed. Made a bid of $350K on the first house, and did not think the 2nd house was worth anything more than $300K, so didn't bid on it (as much as I loath flippers, I'm not going to slap someone in the face). Result on the first house: knowing that we had made a bid, another realtor convinced his/her buyer to make a FULL PRICE offer. They closed in September. Result on the 2nd house: owner kept lowering his price, first to $389, then $379, then $374 for a looooong time. Then 2 weeks ago, lowered the price to $355. It is no longer listed, so I am assuming that it either sold or got taken off the market. Result on the other 7 houses: every single one of them is still on the market.
- Overall, I am still seeing a large disconnect between the sellers and the market. Nothing is selling, yet prices are still not coming down. As per the theory that has been presented on the Bubble Blog, this area is slightly above the median income, so folks can hang on to money-losing properties a LOT longer in this area. Talk about a drag on the economy.
58 comments:
Also, I'd like to thank the many posters here from around the state with your reports. In particular, I'd like to thank:
Crazy-G - Our resident east-coast correspondent. Crazy is as Crazy does, indeed!
Lizziebeth - Our "desperate newspaper-reading housewife", who keeps us up to date on the Sarasota-Bradenton area, as well as great links from around the state.
As they say in the Navy (my home for 6 years), "Bravo Zulu!"
ZEE Best Description of Florida's Real Estae Market Would Be;
""BLOATED DEAD MARKET FLOATING ON A SEA OF DEBT"""
Your staring at the WORST OF THE WORST scienarios....
The corpse & the sea of debt sinking at the same time!!!!!
The stench from this one will permiate the world!!!
Holders of MBS, CDS, CDO's, & REIT's will wonder what hit them....
When pieces of paper, commonly referred to as assets, turn out to be liabilites instead...
Here is what we see in the SW section of Ocala. Even the Silver Springs area is in the same market condition, with many homes turning into rentals due to no sales activity.
Click for a brief overview of SW Ocala (Marion Oaks)
That is incredible, Missie. The # of homes available for rent is nothing short of awe-inspiring. I pity the FBs who recently purchased to actuallly LIVE there.
My only guess as to the glut in Ocala is that the amateur spec-u-vestors saw the cheap prices ($/sq ft), in comparison to the more populated areas of the state. With this and without looking, they all dived in.
What a mess.
Last fall ['05], my wife and I looked at some property over there near Ocala...specifically in Rainbow Springs area.....
Basically, kind of a nice area...NOT that exciting...but nice....
Anyway, we stopped and talked to the Realtor there are the development and at that MOMENT, he was quoting some REALLY ASTRONOMICAL numbers.....
Lot prices had gone from $15-$25,000 tooooooooooo, $95-$125,000...
WHOOAHHHH!!!! HERE!!!
It gets worse....to build a house in that new development [along the highway there, near the RR tracks]...They were talking 2+ years....yes!!! 2007??? with NO guarantee of price....
I told my wife as we walked a out in total amazement..."IF" we come back here in 2007, we'll be able to buy a lot for less than $50,000....may be $25,000
NOW!!! With all the sink holes over there, I wouldn't buy or build, or live in a house "IF" you gave it to me....""""FREE"""
A couple of 2, 3 years ago, I went to see my cousin, who lives in Inverness....kinda near Rainbow Springs there....
Any way, he was taking me around his neighborhood, trying to coaks me into buying a place over there....
I mean the prices ""THEN"" were DIRT CHEAP....
He had purchased, a relatively NICE home, for $82,000 [?], or something...In a fairly nice [OK] area...As he was taking me around the neighborhood, back then, showing me the houses, I could buy, complaining that some of these people were asking to much, and would never get it....
I mean a relatively nice house was selling for less than $100,000
NOW!!!! They're going for $250,000 or something he said of recent...
I live on the beach and there is a furnished condo in a high rise near me that is available for rent at $1500/month. In the same building on the same floor there is an identical condo that is listed at $399k. Both condos are 2bd/2ba and both have balconies with nice views of the intracoastal. However, from a fiscal perspective their similarities end there.
The monthly cost of the rental is $1500 plus utilities, so let's say $1800
The monthly cost of the condo for sale assuming you put down 20% and get a 30 year fixed is roughly $3300. That figure takes into account taxes, condo dues and insurance.
So the "homeowner" ends up paying 83% more per month for the pride of ownership. What a deal. Back when I was younger it was actually cheaper to rent than own. Of course nowadays it is the opposite. Gonna be a long, painful ride to bankruptcy for all those new homeowners in this state.
on previous post meant cheaper to own than rent
The beginning was the end.
The Ape regards his tail.
2007 shall be 2004.
2008 shall be 2002.
Best wishes to the recently elected class of 2006 - you're going to have plenty of misery to deal with in Florida.
Can You top this...Rent vs buy
So, we live in a town house community of a large development, in Ormond Beach...The 'flippers' have been at work here pretty good....anyway, the 4 plex townhouses have basically 2 designs...end units, and middle units....
Down the street, is one, middle unit, for sale [now] $219,00 [was 239,000]...""BUT"" get this...200 ft away, there is another unit for sale for $330,000....
SAME TYPE OF UNIT...SAME STREET....
I'm paying $1250 rent, the neighbors accross the street are paying, $1350, $1100, $1150, & $1375...
The unit I'm renting 'was' for sale by a 'flipper' for $295,000
DOES ANY OF THIS MAKE ANY SENSE AND ADD UP....
>>>>""" I DOUBT IT """<<<<<
Ohh!!! P.S. Taxes in Volusia County are apprx. 2.5%...= approx. $6250 on our unit...+ $1000 HOA...+ Insurance if you can get???
The story goes deeper;
The builder/developer is "still" building, even though there are plenty of units for sale, by them/ & flippers...new units are $300k +/- $5k.....
1 1/2yr ago, the developer was charging $150k for a unit....
Is Crazy really, """ CRAZY """ or is there a ||| DISCONNECT ||| here!!!!
Who is going to back down first???
Cuz ""NOBODY'S" units are selling!!!! Something has to happen sometime/other!!!
The 'word' from the titular head of D.R. Horton Co./ home builders, CEO Donald Tomnitz;
SSOO!!! Coming from the BIG 'tit', himself,
The home building industry is in
a ""DEATH SPIRAL""...
So, who are they going to take down with them?????
We are listing our home in January below all comps just to get out before it gets worse. My neighbors will be pissed, but even after all the renovation we did I still don't think our house is worth 229K We owe 198K(paid 152K) and that's all I want. Other homes in my 'hood are asking 250-299K for 1984 villas and they don't even have a pool or they are still stck in 1984. We are in Tampa on Hillsborough.
A 1984 unit, UNLESS it is EXTRA ordinary, with a fabulous view of something great, in all probabilty worth only $100-$125/ sq ft ""MAX"".....
Realtors are being deciptively kind to sellers by telling them they can sell for what somebody else sold for.....
REPLACEMENT COSTS ARE in the vacinity of $100/ sq ft...
I don't want to know all the details, but, I'd say you've got a problem with your 'cost' numbers, and your not going to get out easy!!!
DR Horton is offering a $50K Community Savings Package, "ie: price reduction", on their website
YOUR CHOICE
Purchase a DR Horton home in this community and combine your choices below to equal up to a $50,000 COMMUNITY SAVINGS PACKAGE! Ohhhhh Ahhhh
You can choose your combo of:
* Sales Price Reduction
* Washer/Dryer and Refrigerator (I would not finance theses for 30 years! What a rip off, just go to Appliance Direct and save a boat load of money... hahahaha)
* Installed Custom Mini-Blinds (I would not finance these for 30 years either!)
* Distinctive Floor Options
* Homeowners Association Fees
* Interest Rate Buydowns
* New Home Prices Reflect Community Savings Package
Plus they state: DR Horton pays ALL Closing Costs. Heck is they let me have $100K off, I might be more intreged to buy here! LOL
Okay, Bradenton/Sarasota, houses not selling. The only houses that I have been tracking that are selling, are those that are dropping the price 30-40%. I haven't gone to see any of the builders to see what incentives they were offering.
Went to Naples last weekend. What a mess! Reading the real estate listings, was pathetic! Owner financing on homes $500k-a million! The funniest was the incentive of $50k at closing to help with decorating, down payment.... on a million dollar home! If you can afford a million dollar home, you don't need help with the down payment or decorating. If you do, you have no business buying it! What a joke! Things are BAD out there! Really, Really Bad!!!!!
I don't know about anyone else out there, but I'm a little scared at what may come out of this mess! Look at the daytraders that went postal! This is bigger than the flippers/specuvestors! Mom and Pop, young couples, families will be hurt! It's scary to think of the scope of this mess! It's not as simple as prices coming down. Yes, as I've read before, "there will be tears", MANY TEARS!
Around here, near Jacksonville, a flipper evidently bought two acres on the water with an old 1971 house at the peak of the bubble frenzy for 1.5 mil even though the asking price was 1.1 mil!
He put it on the market when the market stopped at 1.7 mil. Now it is reduced to 1.5 mill with the option to lease the house on a month to month basis!
Because the property taxes on it are 2 percent that is about 30K property taxes every year and it is low elevation waterfront that almost flooded in the last hurricane so it will be nearly impossible to insure.
Someone is in deep trouble.
South Florida here, (ft lauderdale) same houses I looked at in March are all still for sale, even with drastic price reductions very little movement, more inventory listed every day and lots of houses for rent.
Here in Orlando - prices are not falling much at all. Sounds a lot like other places: nobody is willing to lower their prices, so they get to keep their house "staged to sell" for eternity. Every week, more houses are on the market - the water behind damn is getting higher and higher...
The SW Ocala market is propbably the result of the buildout of SR200. 6 years ago that was a pothole filled chip and seal country road that got you from I-75 to US-41 in Inverness/Dunnellen. Now it's a 4 lane divided highway retirement comunities almost all the was to Inverness. Florida is now too expensive to retire to.
You are right anon...
"On top of the world" is one of the biggest 55+ communities over there. I always think... I would like to live in a 55+ community with my hubby, that is, after having 3 or 4 more kids into our late 40’s! Hahahaha could you imagine a bunch of teens running around, driving the golf carts through the neighbors lawns, terrorizing gnomes! (I am just naughty!)
My aunt and uncle bought in "The Villages" about 4 years ago, they are hammered with fees lest and right, on top of the taxes and insurance... They wish they had stayed in SC.
So, the realtor called yesterday, and talked to my wife, and wanted to know about our lease, that had expired [6 mos lease]....We don't have a stinking lease any more, and don't want one....
You can rent a $3-$400K house in our community for $1500-$1600/mo...
And Yah!!!, the taxes on these cripples are $7-$8000/yr.
NO WAY, am I going to buy into this market....
The realtor had been pushing a VERY, VERY nice home to us, for nearly a year NOW....SAME HOUSE....
that was for sale, last summer ['05] for $435K, and didn't sell, so the retired couple NEDDED action, and changed realtors....Well, this realtor got the listing by telling the client they could sell it for $475K, and showed it to us...I said it was a nice house, "BUT", I needed a bigger garage..NO THANKS...
Well, that was ONE YEAR AGO....
Since then, the price has been reduced BACK TO $435K...and the retired couple has moved back to Virginia....
The realtor said "he really didn't give a ""$hit"", just make an offer"""
>>>HE REALLY SAID THAT<<<
Bottom line is, that's it's been for sale for 1 1/2 yrs, now...You'd think that something would break one way or the other...
IT'S REALLY A VERY NICE HOUSE, IN A VERY, VERY NICE NEIGHBORHOOD
Crazy g - playing with the emotions of the stuck seller and his real estate hack? What a great hobby!
I can agree with others about the retirees not wanting to come here. Today, I was at the Pinellas Park (very low-middle class town, lots of trailer parks, wedged between St. Pete and Clearwater) Wal-Mart, and the fixed-income snowbirds are back. It got me to thinking: with the taxes going through the roof (only for first-time florida buyers), only the dumbest retirees who don't have financial worries would think to move here. I'll be very interested to see the migration numbers to this state in a couple more years.
I'm too lazy to sign up so call me Coral Gables. I moved back to FL last summer, determined not to buy in the wacko market. Realtors, who are a scurvy lot, were not at all helpful in securing a rental until I met a 'newbie'. Poor little fool was actually helpful and got me a very, very nice rental, in very, very nice Coral Gables for far less than mortgage, taxes and insurance would have cost me. The lease was up at the end of Oct and I extended another 6 mos. Now I am thinking of extending more or maybe moving somewhere else. I love this State (of insanity). I grew up on the East Coast but between the idiocy in the market and the insanity of the taxes and insurance, it just isn't making much sense.
Now, what are we seeing here in SoFL (and I wish there were more commentators, so I could compare notes), I am seeing far more inventory at far more reasonable prices, but they are still way too high when you research what they were last purchased for (God Bless Zillow). I have seen a number of homes sitting for at least 6 mos. I am not sure what will happen to the single-family home market in Central Miami. There is not that much that is within very comfy driving distance, so the prices may not reduce that much. On the other hand, who can afford the half a million dollar cottages?!? I heard from a friend who sold recently in Coral Gables. A very nice house, on a very nice street. She sold for $639. She told me a flipper bought it and has it listed right now for $850! A sucker is indeed born every minute.
I'd love to hear from more folks down here in the Northern Carribean.
Missie,
Your Aunt and Uncle are in an enviable position having bought four years ago. Their purchase price was low, thus taxes low and insurance in the Villages isn't as bad as in coastal areas. As for the fees, they knew up front what their fees were going to be. I helped my parents purchase a home in the Villages four years ago and the fees were listed in plain sight. Your Aunt and Uncle are fortunate enough to be able to sell, not lose money and move back to SC. I looked at every retirement community, including On Top of the World, helping find a safe, fun, active place for my parents to spend their golden years. The Villages offers a lifestyle that they would never find anywhere else. They feel the fees are more than worth it!
I think that you will see a major slowdown in retirees buying homes, not only because of insurance, but also due to the housing slowdown across the country. They no longer are able to sell their homes. The next few years will still see snowbirds, but rather than purchasing, these folks will come down in the winter and rent. Hopefully Floridians will remember this mess and next time another Housing Boom takes place, we will control the growth a little better.
Liz,
They groan over the Association fees, they are very expensive for things they don't even use! Hahaha Go figure, they bought into the "Active Lifestyle" of still having to work (part time). :)
After EXTENSIVE sleuthing, here's what Mary Mateo, [a retired NY state police lieutenant] NOW... REALTOR. had to say about the Ormond Beach market....
>>""There is currently a large inventory of all types of homes available. This has resulted in a slight reduction in housing prices. Rather than a "slump," this is being viewed as a market correction after last year's inflated prices. If you are thinking of entering the housing market in Central Florida, now might be the time to start. Let me help you find your next home. I specialize in single family, condominiums and mobile homes. If you are considering the sale of your home, it is important to price it and market it correctly using the services of a Realtor. Contact me for a no obligation consultation.""<<<
Crazy G, nominates Mary Mateo, for the ""SLIPPERY SLEUTH"" AWARD..
It's a treasured nomination, for recognition beyond the call of duty...
The ""ONLY"" question that Crazy has got....
>>>IS SHE STILL PACKING ""HEAT""<<<
Missy,
Have they thought of moving to one of the non-villages communities? My parents have several friends that have and they still come to the Villages for entertainment. In fact, they are closer to the town square than some of the Villages homes. If you don't use the facilities, it's silly to pay for them. Working to pay for them really stinks! Even with a slow down there, they are still in a good position to make a few bucks.
I have been tracking Port St. Lucie, Only One of the 15 homes I am watching have taken their home off of the market.
One has reduced by 12,000 the rest have not budged on their crazy prices.
I am looking at homes between 375,000 to 419,000.
When are we going to see some real reductions? I am not going to buy until this happens, I can wait, I can afford to wait and I can rent.
What can they do with their mortgage payments and tax bills?
9 of these homes are vacant and had been purchased by flippers. They all have addresses from areas of Florida to N.Y. State. 3 of the homes have delinquent tax bills.
SKB.
Port St. Lucie;
The flippers are doing the same thing here!!!
Truthfully, I really don't know HOW it's going to go down!!!!
BUT, it's going down, down, down....
At some point, they will BREAK...for sure....then....
"""DEPENDING"""....Ka--POOOM
In the mean time....they will be stetched very, very tight!!!!
VERY, VERY SAD NEWS TO REPOERT TO FLORIDA HOME OWNERS....
THE WORST OF THE WORST HAS IN FACT OCCURRED......
FLORIDA HOME ONWERS WILL NO LONGER BE ABLE TO PUT """ PINK FLAMINGOS "" ON THEIR LAWNS ANY MORE...
I JUST RECEIVED NEWS THAT THE COMPANY WENT OUT OF BUSINESS!!!!
In as much as today is Nov. 11th...
Crazy thinks, we as Americans should all face our lawns at the twilight hour, and with drink in hand celebrate, the passing of the Pink Flamingo....
Crazy G, found a NEW word for you residence of S.W. Florida....
The word is 'Subsidence'..
Crazy thinks, it's a much nicer word than just saying your ground is sinking.....
You residence over in S.W. Florida, can tell your neighbors that the area around your home was just 'subsiding' today....
It just seems to have a'finer' connotation to it than "SINKING"
Crazy has been doing some digging to get a REAL idea of what is happening in the market place...
Here is some information about Orleans Home Builders....& specifically one of their subs...
""MASTERPIECE HOME BUILDERS"...Who operate in central Florida, and on the East Coast......
|||INFO taken from SEC filing||
It appears that in Q3'05..Masterpiece sold[booked] 100 homes
Q3'06..Masterpiece sold[booked] ""2"" homes
They 'completed'[closed] 64 vs 79 last year
and have a back-log of 76 vs 380 last year.....
It just so happens it seems to CEO/president ""SUDDENLY"" has RESIGNED.....
>>>>>""""CAN YOU IMAGINE THAT????...THEY SOLD/booked ONLY """ 2 """ STINKING HOMES ALL QUARTER"""<<<<
CRAZY THINKS THEY ARE IN SERIOUS TROUBLE!!!!
South Florida here,
Although prices have come down some 10%, they are still way overpriced. Some 90 % of the population cannot afford the medain home. Many sellers are pulling listings off the MLS. Most sellers are in denial. Ftl Lauderdale #2 in the nation in foreclosures.
2007 will be a nightmare.
Excerpts from Masterpiece Builders, parent company [Orleans Homes] Q3'06 SEC 10Q report:
>>>"""The decrease in new orders was a result of decreased demand and significantly increased cancellation rates as investors continued to exit various markets in the region. The Company experienced a 97% cancellation rate in the Florida region for the three months ended September 30, 2006, compared to 25% for the three months ended September 30, 2005. The increased cancellation rates have resulted in a significant increase in the Company’s new home inventory in the region. The Company is currently offering significant sales incentives in an effort to increase absorption rates and decrease its new home inventory levels."""<<<<
""THEY EXPERIENCED A 97% CANCELLATION RATE"""
HOW CAN A MULTI-MILLION DOLLAR COMPANY STAY IN BUSINESS WITH THOSE NUMBERS....EVEN CRAZY CAN'T FIGURE THAT ONE OUT!!!
PROOF POSITIVE THAT MASTERPIECE RAISED THEIR PRICES....again from the 10Q report
>>>"""The increase in residential revenue earned was primarily attributable to a 25.7% increase in the average selling price per home delivered to $284,000 for the three months ended September 30, 2006 compared to $226,000 for the three months ended September 30, 2005. The increase in the average selling price per home delivered was attributable to positive pricing trends in the region in previous quarters and a continued shift in the region toward move-up homes which command greater pricing power than entry level homes. The decrease in the number of homes delivered was attributable to decreased new orders in previous quarters."""<<<<
SO THE DIRTY RATS, JACKED THE PRICES UP 25%, AND NOW WONDER WHY NOBODY IS BUYING IN IT????
SO, IF PRICES WENT UP 25%.... THEY HAVE TO COME BACK DOWN 30%, JUST TO GET BACK TO WHERE THEY WERE LAST YEAR!!!!
Crazy - you are right on, again, brother. There is something very wrong with those numbers.
"Masterpiece"? More like "Piece of....".
The Fort Lauderdale RE association used to publish the sales statistics for Broward county. Guess what, their not doing it anymore. I think the numbers must be really bad, and they think they can tell us lies and we (potential buyers) will be fooled. I hope folks do they're research before buying, but I think a lot of folks still believe the crap the RE say.
Good point, anon. Have seen that in Sarasota/Bradenton, conveniently leaving out Manatee county's figures (big, big, BIG problems with being overbuilt there). Also, Tampa/St. Pete/Clearwater, conveniently leaving out Hernando county (again, BIG problems with overbuilding).
Expect more of the same.
Seeing thru the FOG of the housing bubble, it's easy to see that "IF" builders drop prices 25%, it's only back to 2005 pricing....
And since lumber and other building materials, have also plummeted, along with labor, they [the builders] are just obfuscating, the FOG, even more.....
WE GOTTA LONG WAY TO GO BABY!!!!
Down, she said, get to the quick of the matter!!!
Crazy's comments on sales statistics....
Initially we were interested in Flagler County and started tracking some of the statistics there....Last year ['05], According to the numbers released by the county, they were running maybe 1200-1500 deed transactions per month.....
Mostly, of recent, they have been running 200-250 transactions per month....
Your talking about an 75-80% DROP!!!!
Why would NAR want to tell you that?????
>>>>>THE FLORIDA REAL ESTATE MARKET IS DEAD<<<<
SSOO!!!
The head lines read:
TO MANY HOMES NOT ENOUGH BUYERS!!!!
>>>>||||AT THESE PRICES??? YES!!! |||<<<<
Basic Economics 101, here!!!!
Drop the price and homes will start to sell like candy!!!!
I agree. I've only seen mild decreases.
It can't be denied that a good % of the houses for sale right now are unoccupied. And it also can't be denied that, contrary to what the realtors are saying, people are NOT moving to Florida right now.
Something's going to give. Will "spring cleaning" bring down the prices?
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