Monthly Archives: October 2007

SW Florida Real Estate Market Still Slumping Along

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SW Florida real estate market numbers released today by the Florida Association of Realtors show a continuing decline in the real estate market, which comes as no surprise as we posted our Ellis Team CMI Index numbers back on October 16 that suggested this would be the case.

Single family home sales fell to 327 in September, down from 520 in August, and 693 last September.  Single family home prices fell to $231,600 this September, and was down 7.7 percent from August’s $250,800 and down 11% from last September’s $261,400.

Single family home sales were the good news.  Condo sales fared worse, also predictable due to the CMI Index numbers released a few weeks ago.  Condo sales were 102 this September 2007, up from 96 in August, but down from 168 last year.  Prices for condos were up to $224,000, up from $218,800 in August, and down from $231,600.  The bad news for condos isn’t the prices or sales levels, it is the sales levels as compared to the level of inventory on the market.

Even with the poor numbers, they can partially be explained by seasonality, and partially by overall weakness.  See SW Florida single family home sales graph 2005-2007. To view sales prices , see SW Florida single family home price graph 2005-2007.

The Outlook going forward actually is brighter than the numbers indicate.  For the first time in a long while buyers are getting excited again, and are venturing out looking at homes.  For some, it is simply becuase home prices are back in their affordability range.  For others, it’s the sense that now may be the time to buy as prices have come down so much, and they’re feeling confident again going forward.

 

October 2007 Ellis Team SW Florida Current Market Index

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It could just be the time of year as pending sales typically drop anyway, or it could be a sign that the market hasn’t bottomed out yet.  Either way we’re not happy that the CMI Index has risen once again, a telling sign about the upcoming months ahead for this market.

Active listings are holding relatively steady. however, they are still rising.  Pending sales are also holding relatively steady, however, they are still dropping.  Either one wouldn’t be so bad except for the fact that inventory levels are near their highest levels.  This isn’t the best time for either of these events to occur, let alone both simultaneously.

Many agents I talk to, however, are optimistic that this upcoming season will be much better than the past two seasons.  We also look forward to the results of proeprty tax reform in Florida, which could influence affordability for home buyers.

The higher the CMI Index, the more supply we have relative to demand.

October 16, 2007 Active Pending CMI
Single Family 15,438 783 19.72
Condo 8,212 354 23.20
September 15, 2007 Active Pending CMI
Single Family 15,215 809 18.81
Condo 8,141 369 22.06
August 15, 2007 Active Pending CMI
Single Family 14,919 955 15.62
Condo 8,190 417 19.64
July 12, 2007 Active Pending CMI
Single Family 15,095 975 15.48
Condo 8,380 443 18.91
June 14, 2007 Active Pending CMI
Single Family 15,164 1,014 14.95
Condo 8,761 485 18.06
May 17, 2007 Active Pending CMI
Single Family 15,607 1,107 14.10
Condo 9,205 560 16.44
April 15, 2007 Active Pending CMI
Single Family 15,896 1,152 13.80
Condo 9,660 569 16.98

January 23, 2007 Active Pending CMI
Single Family 13,769 1,016 13.55
Condo 9,002 529 17.02

November 27, 2006 Active Pending CMI
Single Family 13,186 1,031 12.79
Condo 8,344 535

15.60

Renter Beware Article on News Press Blog

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Tenants are being evicted because their landlords are collecting rents but not paying the mortgage on the home.  Some sellers legitimately can’t afford the negative cash flow, however they are keeping and pocketing the rent and not paying the bank anything.  This practice may violate the terms of the mortgage, and forces the bank to foreclose on the home, leaving the tenant homeless.

To make matters worse, we just have to wonder whether the landlord has followed the law and placed the last months rent and security deposit into a separate Florida bank account for safe keeping. 

Tenants have been calling our office looking for a place to rent or buy.  Some tenants in SW Florida are taking the opportunity to buy at better prices now that the real estate market has corrected.  Not all tenants are in a position to take advantage of the buying opportunities due to credit issues, so they are forced to move quickly to another rental home.  Moving can be costly, so it pays to make sure your future landlord is financially stable and will pay the mortgage.  Ironically, it has been landlords who have done credit checks on potential tenants before deciding to rent to them.  We may see a day when tenants also do a mortgage check to make sure the landlord is financially making the payments.  Talk about a turn of events.