Florida Mortgage Loan Analyst Predicts Drop in Home Prices

This would be welcome news.

A South Florida real estate and interest rate authority has considered the prices on single-family homes in the state - he predicts a decline that would open up the Florida home mortgage world to a slew of lower-income individuals and families.

Mike Larson from Weiss Research said he expects a further softening in both the single-family home and condominium markets.

“Indeed, we could see single-family home prices fall nationally for the first time,” he said. “Condos are already declining in value, and that’s the next logical step.”

However, Larson, said investors need to sort out the facts from the headlines and calmly evaluate their strategies to avoid making rookie mistakes. There’s A LOT of Florida mortgage loan news out there and it’s important to understand every aspect of it.

“The wrong move now could cause needless hits to family savings or the loss of a retirement nest egg,” he said, noting housing inventories are at their highest level in history and sales are falling.

In South Florida, median June prices for single-family homes declined in two of the area’s three metropolitan statistical areas. Only Miami registered a rise in median price - 4 percent. The increase there was to $378,000 in June from $363,100 the same month the year before.

Larson said homeowners who have to sell shouldn’t chase the market down and let their listing get stale.

“Incremental price reductions will not be helpful in a down market,” he explained. “It’s better to attract the maximum number of potential buyers right at the outset by pricing your property at a very competitive price.”

For homeowners caught in an adjustable rate or interest-only Florida home mortgage that’s about to adjust higher, Larson cautioned NOT to wait until the payment becomes unaffordable.

“Consider refinancing now,” he said. “As the market slumps, underwriting guidelines should become stricter, leaving you with fewer financing options.”

Larson also said homeowners already having trouble making payments should get in touch with their lenders right away. He said they may be able to negotiate payment deferrals on their Florida home loan or other remedies to avoid foreclosure.