Tag Archives: Lee County Florida short sales

SW Florida Short Sale & Foreclosure Update

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Everyone always asks how prices are doing in SW Florida.  The next question is usually along the lines of how are distressed sales such as foreclosures and short sales affecting the market.

Short Sales, Foreclosure Sales, Traditional sales SW Florida
Traditional Sales Vs Distressed Sales

We have new numbers just released that will help answer these two questions.  Sales have been falling the past several months as they usually do this time of year.  This is also influenced by fewer listings on the market.  We have demand but limited supply.  Traditional sales are down as well as short sales and foreclosures.

As you can see from the attached chart, we had 158 foreclosure sales for single family homes in Lee County in August.  This is down from the peak in March of 209 this year.  Short sales are also down from their peak in March.  It seems March was the peak for all three types of sales.

SW Florida is in that no-man’s land we predicted several years ago.  Our prediction was inventory will be less and prices will rise, but not enough to encourage many homeowners who are underwater but hanging on.  Our market is set to take off on the price-wise to the upside, but one thing is holding it back.

In a word, it’s the Economy.  All signs point to upward price pressure.  We have demand and limited supply, but incomes are not rising and we don’t have jobs to support enough full time end users with good enough credit.

SW Florida is littered with people who would like to purchase but have suffered a foreclosure or short sale themselves, so they are precluded from getting a mortgage for awhile.  Even if they have regained full employment it’s difficult to get financing.

Many people are still hurting in SW Florida, and many more moved away perhaps never to return.  When Florida’s economy returns we have the potential for some nice price appreciation.

Mind you, we think inventory will increase as prices rise.  People who are barely underwater may not be with future price increases.  So many are locked into a home that no longer meets their needs, but they can’t sell right now without facing difficult decisions.  As prices rise options will open up for some.  Others are so far underwater it may be some time before they’ll be able to sell.

Florida still has sunshine, the beaches, year round golf, and provides for an active lifestyle year round that is attractive to baby boomers who wish to retire or spend time in a nice climate as a second home.  As the national economy improves more service sector jobs will be required.  Along with those jobs typically comes construction jobs, and with that the cycle develops.  We’ve seen the beginnings of construction jobs here in SW Florida, but they’re peanuts to what they were.

The good news is Florida is a desirable place to spend time or live, and SW Florida is amongst the best places in Florida.  We live in paradise, and the future looks bright.  Our market is still healing while all signs look to positive gains.  The gains are when, not if.  Time will answer how fast the market improves, and we believe the economy will dictate the pace.

If you’re looking for your piece of paradise, you could wait, but why?  Prices are going down.  They will rise, and the investment alternatives in stocks, bonds, and even precious metals are dicey.  Returns are just hard to come by without taking huge risks, and the paltry returns usually aren’t worth the risk. Real estate may be the least risky and offer more to the upside.  At least you can rent out or live in a house.  It’s hard to rent out or live in a commodity.

If you’d like help securing your piece of paradise, feel free to call the Ellis Team at RE/MAX Realty Group 239-489-4042. We present you with your options and help you make a good decision for you.

Good luck and Happy House Hunting!

We’re testing a New MLS Search Site.  Click to view properties throughout SW Florida and let us know if you like it better than our Leecountyonline.com Search Site.

 

April Sales Activity

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Last week we reported showings and phone calls were down for a few weeks after Easter according to several agents we spoke with, but that all changed about a day after writing the story.  Phone calls and offers picked up significantly last weekend, so it’s very hard to judge the market on a daily basis.                   

This week we decided to step back and analyze April 2010 vs March 2010.  Official numbers won’t be released until next week, however we believe we’ll see a year over year increase in home sales about 9-10%, and we believe prices will up again over last year as well. 

SW Florida Real Estate Home Sales Lee County Florida
Single Family Home Sales in SW Florida March-April 2010

We’ve created a graph illustrating sales numbers for March-April of 2010.  Sales for single family homes increased ever so slightly over March.  We then wanted to know the mix of foreclosed homes and short sales.  Foreclosure sales actually fell 10.43%, while short sales rose 12.96%.  This coincides with our predictions back in March that we may see a rise in short sales as bank gear up to handle more short sales. 

Foreclosure filings have been down, so 6 to 12 months in the future it’s reasonable to assume there may be less foreclosure properties for sale, especially if banks continue to increase their short sale efforts. 

Our numbers are close to but not identical to official numbers that will be released next week for one reason.  We use data from multiple MLS’, but there is the potential for some listing overlap if a property is listed in more than one MLS.  Statistically that runs about 5% give or take.  We’d rather have a little overlap than miss a lot of listings and sales. 

Condo sales were up in April over March, and that would be expected as condo sales tend to build throughout the season and culminate in April.  Condo sales are increasingly difficult to finance with new regulations on approving not only the borrower, but also the association itself.  Many March closings were pushed back to April, and we suspect many April closings may get pushed back to May, so May could be a good month due to high sales and delayed closings, both in the condo and single family markets. 

Headlines next week should read home sales up somewhere around 10% +/- depending on what the official figures are, and home prices up as well.  Last year’s April median home price dipped to $85,500.  March 2010 median figures shot up to $95,100 up from $88,000, so even if prices hold steady from March we should be reading about price increases. 

Next weekend is Memorial Day weekend, so sales activity will drop-off as people plan their time off.  It will be interesting to note people’s perceptions of Florida and their willingness to book vacations here in advance due to the oil crisis in the Gulf.  Many visitors come back in the summer and buy.  Additionally, the Euro is now worth less, so it will be interesting to see if that affects foreign visitors this summer with less buying power.  Hopefully once we sort out the Gulf oil spill, our Chambers of Commerce will promote the area as a great place to visit.  We count on many of these visitors to buy property in Florida each year, so we do want them to visit and spend money in Florida and help our economy. 

In the meantime, let’s enjoy some positive publicity next week.  Our market is due for positive news, and it helps buyers to understand that prices are rising and inventory is shrinking little by little, and the time is now to step up if they want in on today’s bargains.