First Home, now a division of Hovanian Enterprises, claimed it’s first lending victim.  Investors from the credit union bought several homes with construction loans, which means the buyer financed the construction of the homes.  The problem is between the time the investor went to contract and the time it took to close-out the construction-perm loan, the market fell significantly to the point there wasn’t enough value in the home to justify the loan to value ratio.  Lenders no longer wanted to issue permanent financing, and the loan failed.

The investor can’t close-out the loan, and can’t sell the property for what they paid for it, so the buyer can’t ultimately close.

Not only will this have far reacing impacts on lenders, it may affect the builder as well when they don’t receive final draws on the construction loans and have oodles of properties tied up in court or foreclosure.

In fact, already many investors are suing alleging fraud by First Home, Construction Loan and D’Alessandro & Woodyard, a real estate brokerage that sold some houses for First Home.

More lawsuits are expected as investors from all over invested in these deals.  First Home primarily builds homes in Fort Myers, Cape Coral, and Lehigh Acres Florida.  Many investors had decent credit scores, but lacked the assets to carry the properties if everything didn’t work out the way they planned.  Obviously, things didn’t work out the way they planned as the market took a serious turn and didn’t pass Go.

The SW Florida real estate market has been hot and cold, up and down.  The first few weeks of March were hot, the second half was not.  Recent trends show the Lee County housing market is gaining strength, but don’t look for prices to pick-up anytime soon as we still have high inventory levels.

We expect 2007 to be a gradual strengthening market, and by strength we mean inventory leveling off and home sales picking up from 1st quarter 2007 levels.

Florida weekly is SW Florida’s newest newspaper.  The paper features articles on SW Florida, including SW Florida real estate, as well as online ads.

Links to the RSS Feed will begin soon.

The hot Fort Myers, Cape Coral housing market helped fuel census estimates which shows Fort Myers and Cape Coral was the third fastest growing metro area in the country, with 29.6% growth.  Naples Florida wasn’t far behind at #7 with 25.2% growth.

Data was from April 1, 2000 to July 1, 2006.  SW Florida real estate is still very popular, and we are expected to grow at steady rates.  Housing supply in SW Florida may have slowed down until demand has a chance to catch-up with supply.

As this process occurs, housing affordability in SW Florida becomes more affordable, until which time we reach equilibrium again.  Housing numbers are expected to regain strength throughout 2007, while prices are expected to remain flat. 

The Ellis Team at RE/MAX Realty Group in Fort Myers has created some custom graphs to illustrate the nature and scope of the SW Florida Real Estate Market.

Our first graph, shows the number of homes closed by month for the years 2005-2007, and you can see the first few months of 2007 are down drastically over 2005 and 2006.  We expect these numbers to increase each month in 2007, however we don’t expect them to return to 2005 levels.

Our next graph illustrates home prices in SW Florida real estate by month.  As you can see, prices are above 2005 levels and trailing 2006 levels.  As 2005 was a year in which prices rose, we epect this number could fall below 2005 levels anytime in the next few months.

Our last updated custom graph shows price changes by month instead of looking solely at the past year.  We think this graph is particularly useful to spot trends.  Home prices rose last November, December, and January of this year.  February of 2007 gave back a large portion of the past 3 month increases in SW Florida.

Of course you can view many updated statistics in the SW Florida real estate market by visiting our Southwest Florida Housing Statistics page.

Lee County Florida saw a record number of property tax appeals for the 2006 tax year.  2,896 property owners appealed their taxes, while only 250 were granted.

It’s not surprising people would appeal their 2006 taxes as property values increased dramatically in 2005.  2006 tax assessments are based upon property values set Jan 1, 2006.  2006 was a year in which property values declined, but much of the decline wouldn’t be included in the 2006 tax bills as it was based upon Jan 1, 2006 data and not November data when tax bills actually came out.

2007 property tax assessments should be lower as they will be based upon January 1, 2007.  Keep in mind that there are two components to your final tax bill, the assessed value and the millage rate.  Politicians set the millage rate, and the property assessor sets the assessed value.  While assessed values should go down, we don’t know what the millage rate will be for 2007, so stay tuned.

Lennar profit dropped 74% due to slower sales in the Western and Central regions.  Home builders are facing competition from sellers in the resale market, which is affecting profitability.  Builders have been reducing prices as sales have slowed.  Sellers don’t always have to sell, they can stay and live in their home.  Builders must build and sell, as that is their business so they’ve been much more sensitive to pricing in the market.