Florida Real Estate Market Trends Have Wide-Ranging Influence
The Florida real estate market as a whole has, for many years, influenced the sale of property in Hendersonville, N.C., writes Jim Wooldridge in the Homes section of the Hendersonville Times.
Many locals own winter homes in the Sunshine State and many Henderson County residents are those who moved from a northern state to Florida, found it too hot, and moved half way back. Some of the largest home builders in North Carolina started in the southernmost state.
Today, many parts of Florida are feeling seriously depressed real estate values, in some cases more than 30 percent.
The effect on Hendersonville is a slowing of sales because would-be buyers here must first sell their homes in the Florida housing market.
A personal view of the situation in the Sunshine State was given last week by a long-time builder and real estate investor, John Pierce, who bought a home in Hendersonville last year.
“Hendersonville attracted my wife and me with its special ambiance. We have property in Florida, California and Michigan and we this is different. You don’t have the big speculators and the huge developments here,” he said.
“Florida has a tough situation, mainly because of large inventory of homes built during the recent boom years and very high insurance costs that came after the hurricanes.”
Most home buyers expect their insurance costs to be part of their monthly Florida mortgage payment, and when these costs jump 200 percent, it makes the monthly payment beyond the reach of many buyers.
Florida’s legislature has passed a plan that makes the state government the financial backup for property insurance companies, allowing them to reduce premiums. Starting in June, premiums are scheduled to drop 22-39 percent. Another hurricane-free year would allow more reductions.
The excess inventory of housing may be a more difficult problem. The Florida housing market market started heating up in 1999-2004, when average home prices were moving up 15-17 percent a year. This is a fast rate, but one which was fed by a steady demand.
Starting in 2004, the increase jumped to nearly 90 percent within about 18 months, he said, as speculators bought up condos and homes by the handful.
In Lee and Collier County, there are houses that were partially completed but abandoned by builders nervous about being paid.
The real solution is a stronger market, which will require a significant reduction of homes for sale or a sudden surge in demand for Florida home loan financing.
Follow the link to continue reading in the Hendersonville News …
