Florida Condo Market: More Trouble Ahead

As we talked about a day or two ago, when it comes to single-family homes in Florida, now is a great market in which to buy.

But hold off on those condominiums, according to the Sun-Sentinel.

That’s the word from the University of Florida, which last week released a study that suggests the South Florida housing market is stabilizing.

Real estate experts surveyed indicated that price declines are easing for single-family homes. Some of the 318 experts, including lawyers, financial advisers and title insurance providers, said prices were staying even with inflation.

Home buyers might not gain from holding out much longer, said Wayne Archer, director of UF’s Bergstrom Center for Real Estate Studies.

“It looks like the single-family home market might not be getting any worse,” Archer said. “That’s faint praise, but that’s the way we see it.”

It marked the first time in the survey’s five-quarter history that the residential outlook had improved. However, the state’s overbuilt condo market likely face more problems ahead.

Many of the experts said foreign investors remain bullish on Florida real estate, despite high Florida mortgage costs and residents’ concerns with hurricanes, taxes and insurance.

Yet the UF report might have been the rare piece of good news - one of the few bright spots on the housing market front last week. Many are projecting a somber 2007.

A report on MSNBC said the soft real estate market would continue to cost the industry jobs. And the CEO of D.R. Horton, the nation’s largest home builder by volume, said his company would struggle in 2007.

Specifically, he said it will suck.

Meanwhile, existing home sales and prices were down in both Broward County and Palm Beach County in January, the Florida Association of Realtors said this month.

“Just because we’ve seen a decline in how fast home prices are falling doesn’t mean they have stopped falling. And once we get to the bottom, then what? The bottom might become the new reality,” Delray Beach housing analyst David Levin said.

Yet the housing market’s yearlong struggle is no reason to give up hope, said David Dweck, founder of the Boca Real Estate Investment Club.

Dweck said one of the club’s members, Jim Di Paola, recently made more than $100,000 in profit from the massive renovation and sale of a Delray Beach house. Not every investor will make that kind of cash, but Dweck said the lesson here is clear.

They originally listed the house for $365,000, and with Florida home loan rates so low, they had plenty of showings. But no buyer. So they lowered the price and eventually sold it in January for $321,000.

“In a market like this, you have to have two things,” said Di Paola. “You have to have a product that’s better than any other, and it can’t be the most expensive house in the neighborhood.”

Something to remember when you go to make an offer in this market - and put your home up for sale under these turbulent conditions.