Palm Beach Country Housing Market Slump Over, Report States

A slump in the Palm Beach housing market? Not anymore.

Moody’s Economy.com said the median price of existing homes in Palm Beach County dropped 5.7 percent from the fourth quarter of 2005 through the third quarter of 2006 - but they will NOT go any lower.

Per Gunnar Berglund, a chief economist for the research firm, cautions that the report isn’t infallible - but those seeking a Florida mortgage may wish to heed its information now and look into a purchase while prices are low.

“It’s like a weather forecast. Sometimes it’s right, and sometimes it’s wrong,” he said. “We’ll probably see prices fall a little bit further, but most of the decline has already occurred.”

Bright future for Florida housing markets

Broward County will have to wait a little longer for its recovery to start. That area’s median proce will drop 5.9 percent from the fourth quarter of 2005 through the third quarter of 2007, according to Economy.com. What’s more, the firm doesn’t expect market crashes in either Palm Beach or Broward counties.

However, if you own a home on the southwest coast of Florida, look out. The Naples, Sarasota and Cape Coral housing markets all are poised for a downturn. Although the housing slowdown will hurt Florida’s economy, it won’t be devastating, Berglund said.

It will help, of course, if various sales stop collapsting. In fact, more deals are falling apart at the last minute as shell-shocked buyers discover how expensive property taxes and insurance are, said David Dweck, a real estate agent in Broward and Palm Beach counties and head of the Boca Real Estate Investment Club.

With prices falling, buyers also are trying to wiggle out of Florida home loan contracts, hoping to find better bargains in the next few months, Dweck said.

Where do sellers fit in?

This last point begs the question: What rights do sellers have when deals turn sour?

It depends on the contract, said Oscar Rivera, managing shareholder for the Coral Gables law firm of Siegfried, Rivera, Lerner, De La Torre & Sobel. Real estate contracts have different provisions in case of default, Rivera said. Some allow for the seller to keep the buyer’s deposit but stipulate the seller can’t also sue for damages.

But Rivera points out that a buyer might not be in default. If the deal is contingent on financing, for instance, and the buyer can’t secure a Florida mortgage loan, the buyer would owe the seller nothing.

Bottom line: “You really need to know what you’re signing,” Rivera said.