Home Buyers Returning in Northeast Florida Housing Market
Prospective home buyers have been sitting on the real estate market fence for months, but developers say recent statistics show they are starting to jump off and back into model homes.
After home sales tumbled during the second half of 2006, many single-family house builders responded with price cuts and incentives to reduce excess inventory. Now their efforts seem to be paying off with an increase in foot traffic at model homes.
With visits to custom-built models up 50 percent to 60 percent, and 200 percent in semi-custom models, Pineapple Corp. of North Florida President William Ash sees signs of better times. Florida mortgage loan activity appears to be picking up.
“It’s pretty OK out there,” Ash said. “We’re very bullish on 2007.”
Brylen Homes Inc. President Bryan Lendry attributed the good news to a decline in builder inventory, the conclusion of the mid-term election campaign, more positive news coverage and the Northeast Florida Builders Association’s It’s a Great Time to Buy campaign, launched two months ago.
“Everything’s clicking together,” Lendry said. “It would be safe to say that we’re seeing a rebound.”
In Lendry’s case, model home visitors jumped from 83 in November 2005 to 136 in November 2006.
With 64 visitors documented during the first two weeks of December, numbers are on schedule to double compared with December 2005, when residential real estate sales in the Jacksonville housing market were near record levels.
KB Home Inc.’s visitor traffic increased by 10 percent in December and in the fourth quarter as a whole.
Spokeswoman Cara Kane said many of the visitors came to see the model homes in communities that opened in the last 30 days. Although sales are not up significantly yet for KB, Kane said she expects them to increase as well in the coming weeks.
Model home visits are already translating into more sales for Pineapple.
Ash said the company has closed on two homes in the past 30 days, which is up from one sale about every 45 days during normal Florida housing market conditions.
Engle Homes Inc.’s model home traffic counts are up from the 70s in October to the 90s so far this month, and Jacksonville division President Andy Chambers said those who are visiting are “true buyers,” meaning they plan to live in the homes they buy.
“December is not historically a great buying season for Jacksonville,” Chambers said. “We’re very encouraged.”
Beazer Homes Jacksonville region President Barbara Moore attributed much of her company’s traffic increases this month to the fact that many prospective buyers realize that incentives and lower prices will not be available much longer. Beazer’s excess inventory will be gone in one to two months, she said.
Moore expects the number of model-home visitors to continue increasing in 2007, as well as the number of home sales and Florida mortgage applications.
“But it will be predominantly real home buyers, which is a good thing,” she said. “It’s not healthy to have a lot of speculators in the market.”
